Cove-McCoy mine augers well in Echo Bay expansion plans

Edmonton-based Echo Bay Mines, which four years ago produced just 118,000 oz of the yellow metal, plans to pour 550,000 oz next year and is shooting for 700,000 oz in 1989.

This incredible growth rate has been accomplished by acquiring a number of mines in the southwestern U.S., adding considerably to the company’s only producing mine in Canada — the 190,000-oz-per- year Lupin mine north of Yellowknife, N.W.T.

The U.S. mine that contributes most to the company’s gold output is the McCoy mine, acquired in October, 1986. It is located in Lander Cty, Nev. In the 3-month period ending Sept 30, production was up 45% from the previous quarter to 28,796 oz.

And that level of production should increase even more dramatically over the next two years.

Echo Bay is in the final stages of constructing a new crushing plant and a 2-million-sq-ft heap leaching pad at the McCoy. And a new 5,000-ton-per-day mill is planned to treat ore from the nearby Cove deposit where significant exploration results were announced recently (N.M., Oct 12/87).

That mill should be in operation by mid-1989 making the Cove- McCoy the leading contributor to the company’s gold production.

Echo Bay has announced drill- indicated reserves in all categories in the Cove deposit at 16.4 million ton at an average grade of 0.076 oz gold and 3.2 oz silver per ton. The deposit is still open in a number of directions and at depth.

In the 3-month period ending Sept 30, Echo Bay had net earnings of $13.6(US) million or 14 cents a share on revenues of $56.7 million compared to $6.3 million in 1986 when revenues were $30.4 million.

Consolidated gold production costs for the company’s six mines were $208 per oz in the third quarter.

Net earnings for the first nine months of 1987 were $33.6 million, 36 cents per share, compared with the 1986 earnings of $16.9 million or 20 cents a share.

The company’s shares trade on the American, Toronto, Montreal, Alberta, Paris and Brussels stock exchanges.