Goldcorp extends high-grade zones at Red Lake

Ongoing exploration by Goldcorp (TSE) continues to expand high-grade gold zones at the Red Lake mine in western Ontario.

Results from 33 holes show that nine have values greater than 0.97 oz. gold per ton (uncut) over widths from 3.5-19.8 ft.

Five of the six holes drilled below the 30 level stope returned values from 2.38 to 18.48 oz. (uncut) over widths from 7.5 to 17.1 ft. in the quartz carbonate FW zone. The results expand the strike length of the mineralization by 300 ft., for a total length of 1,400 ft. below the 30 level. The zone is still open to the west.

At the eastern end of the FW structure (65 ft. below 30 level), one hole of three returned 0.97 oz. (uncut) over 19.8 ft. Drifting is in progress at the western end of the 30 level, the objective being to provide access for a major drill program in an unexplored area above and below the level.

Goldcorp brought in a larger drill for deeper holes to explore the projection of all zones in an area where three preliminary holes (completed on the 34 level) cut the quartz carbonate structure down to the 36 level over widths of 5.4-12.4 ft.

Above the 34 level to the east, a hole returned 3.1 oz. (uncut) over 7.3 ft.

in the sulphide zone. This target will be tested by infill drilling.

The Red Lake mine turned out 14,702 oz. gold during the first quarter of 1996, down from 19,569 oz. a year earlier. The cash production cost per oz.

was US$309 per oz., compared with US$246 per oz. a year ago.

The 1996 gold production target for the Red Lake mine is 53,000 oz. at a cash cost of US$336 per oz. and a total operating cost of US$376 per oz. The operation is being upgraded with a view to increasing production to 850 tons per day, or 150,000 oz. per year.

Goldcorp has interests in other mines in the U.S. which, combined with Red Lake, are expected to produce 186,000 oz. this year. Goldcorp’s share, net of minority interests, will be 112,000 oz. The cash production cost is expected to average US$277 per oz.

Goldcorp reported earnings of $4.9 million for its latest quarter (or 16 cents per share) on revenue of $30.3 million, compared with $2.1 million on $35.2 million a year earlier. The increase is due both to a $3.7-million after-tax gain from the sale of securities and an increase in the realized gold price in 1996. These factors were offset by reduced gold production and higher costs at the mines.

Production was deliberately lowered at Red Lake in order to carry out a program of accelerated exploration and development.