GOLD AND PRECIOUS METALS — Lyon Lake writes down properties

Citing continued low gold prices, Lyon Lake Mines (LLL-M) is writing down the value of its gold properties in Costa Rica and Canada.

For the fiscal year ended Dec. 31, 1997, the Montreal-based junior recorded a $4.69-million assets writedown against earnings on the Beta Vargas property in Costa Rica. As well, Lyon Lake has written off $237,000 in costs on the Benoist property near Le Tac, Que., stating that it will now focus its exploration efforts solely on its Costa Rican properties.

For 1997, Lyon Lake posted a net loss of $5.52 million (or 14cents per share), compared with a net loss of $428,000 (1cents per share) the previous year.

The company recorded an interest income of $70,000 last year, compared with $101,000 in 1996. Operating costs (net of preproduction revenue) of $247,000 have been capitalized as preproduction costs until the start of commercial production.

Lyon Lake poured its first gold at its 100%-owned Beta Vargas open-pit gold mine in December 1997 and began commercial production there earlier this year.

In 1997, the company spent more than $1.3 million exploring its Beta Vargas and Esperanza properties in Costa Rica and identified several areas that are to be tested this year.

The primary objective of the upcoming drill program is to increase gold reserves on the Beta Vargas property to a level that will justify the construction of a second heap-leach pad.