The reactivation of the McLeese Lake open-pit copper mine in British Columbia enabled Gibraltar Mines (TSE) to report a profit of $416,000 for the fourth quarter of 1994, on revenue of just over $13 million.
The company sold 6.1 million lb. of copper in concentrate plus 2.5 million lb. of cathode copper at an average price of US$1.26 per lb., its highest quarterly average in the past five years.
McLeese Lake is expected to produce 65 million lb. of copper in 1995 at an average cash cost of about US90 cents per lb.
However, the mine’s 9-month shutdown, combined with a significant increase in exploration expenditures, resulted in a $10.1-million corporate loss for the year ended Dec. 31. Negative cash flow from operations (after changes in working capital) totalled $8.5 million for the year.
Exploration expenditures exceeded $7.1 million, including $5.9 million on the company’s Lomas Bayas property in Chile.
Gibraltar acquired Lomas Bayas late in the year, paying US$19.3 million, including US$3.5 million for an underlying royalty.
Gibraltar expects to complete a feasibility study on Lomas Bayas in the fourth quarter of 1995 and is currently seeking financing.
Development is expected to last 18 months.
The preliminary resource in the Tirana and Andacolla-Candelaria zones was last estimated at 88.3 million tons grading 0.68% copper, with a further (low-grade) resource of 100 million tons grading 0.27% copper. It is estimated that a US$157-million mining and leaching complex, operating at 22,000 tons per day and employing solvent extraction-electrowinning, would produce 100 million lb. per year at a cash cost of US52 cents per lb. This estimate is based on a leaching recovery of about 84%.
At year-end, Gibraltar had $22 million in working capital, no long-term debt and 22.9 million shares outstanding.
Be the first to comment on "McLeese reopening helps Gibraltar’s quarterly profit"