Century cuts gold at Lamaque Far North

A drilling campaign to assess targets on the Lamaque property in Val d’Or, Que., has indicated gold mineralization on both the Main Plug and West Plug intrusive bodies.

The drilling, by Century Mining (CMM-V), is an attempt to prove up additional tonnage for the Sigma open pit, immediately north of the Lamaque mineralization. Century put Sigma back into production in June. The Main Plug was the principal host of mineralization at Lamaque, which produced 4.5 million oz. gold between 1935 and 1985.

Drilling on the eastward extension of the Lamaque No. 1 Vein, near the Main Plug, has shown “excellent continuity” with earlier results, the company said. A 1,655-metre drill program on the West Plug had a similar outcome.

Among the better results from the Main Plug were a 3.1-metre intersection grading 15.9 grams gold per tonne, a 7-metre intersection grading 7.8 grams per tonne, and a 2.4-metre intersection grading 5.7 grams per tonne.

On the West Plug, a 7-metre interval in one drill hole ran 13.3 grams gold per tonne; another intersection of 7.4 metres averaged 5.9 grams per tonne; and a third intersection, 3 metres long, graded 14.9 grams per tonne.

The intersections are at shallow depth and fit Century’s plan of mining near-surface, local vein structures by open pit to feed the Sigma mill.

The current measured and indicated resource on the West Plug is 693,000 tonnes at an average grade of 2.3 grams gold per tonne, with a further inferred resource of 489,000 tonnes grading 1.9 grams per tonne. The new drill information is being used to increase confidence in the resource and pit designs and feasibility work continues with the aim of moving the resource into reserves.

The Main Plug results are also being fed into a resource model, with the intention of developing a mine plan in the area.

PURCHASE PRICE: Kinross issued 178 million shares, valued at US$1.3 billion, to take over Echo Bay Mines and TVX Gold in January 2003.

VALUATION: US$400 million valuation on Echo Bay and TVX assets increased to US$576 million.

GOODWILL: US$918 million reduced to US$742 million, then to US$342 million at year-end after a US$400-million impairment charge.

FIXED ASSETS: Property, plant and equipment originally valued at US$214 million revalued to US$168 million.

MINERAL PROPERTIES: Mineral interests originally valued at US$284 million revalued to US$588 million.

BALANCE SHEET: Total assets of US$2.1 billion reduced to US$1.8 billion; book value of US$1.8 billion reduced to US$1.3 billion.

P&L: Net earnings of US$19.7 million restated as net loss of US$406 million, after impairment charges