Durham may have a long wait for profits

During the past two or three years I have noted many comments rega rding Durham Resources and most of those comments were very positive. I wonder now why Durham has become so negative as far as market activity is concerned. L.W.J., O’Leary, P.E.I.

The performance of Durham Resources on the stock market over the past two years has been truly abysmal (the stock price peaked at $3.30 in early 1985 wh ile it recently traded at about 80 cents ) and we can only speculate as to why investors have become so disenchanted with the company.

First of all, a change in management coincided with the company’s decline. Previously run by Noble Harbinson, control of the company was sold to Calgary-based Oakwood Petroleums in late 1984.

After that, Toronto lawyer Robert Granger took on the duties of chairman, president and chief executive officer. Mr Granger says he devotes about 15%-20% of his time to the company.

Regardless of that change in management, however, is the decline in interest of oil and gas exploration offshore Nova Scotia. Durham was a key player in that situation, but its appeal dwindled dramatically when oil prices plummeted in late 1985.

As for Durham’s antimony mine in New Brunswick, Durham’s main asset and source of operating income, sales just haven’t lived up to expectations from what we gather. On top of that, antimony prices, although stronger in the past half year, are anything but bullish.

All in all, it’s clear that the character of the company has changed dramatically in the past two years. What we might have characterized in 1984 as a company with great exploration potential in the hands of a seasoned mining promoter has become a company judged almost solely by its operations in a less than glamorous commodity running at a loss under part-time management.

It could be a while before Durham bounces back.