Troubled Quebec miner
The loss translates into a penny per share, and compares with a year-earlier loss of $467,000. Conversely, revenue between the two periods climbed by $3 million to $8.1 million. Cash consumed by operating activities was $2.4 million, a stark contrast to the $2 million generated a year earlier.
For the first nine months of the year, McWatters incurred a loss of $10.6 million (or 3 per share) on revenue of $16.5 million. Operations consumed $3.2 million.
During the third quarter, McWatters squeezed 14,866 oz. gold out of 338,337 tonnes of ore. Ore grades during the period averaged 1.44 grams gold per tonne; cash costs amounted to US$432 per oz., and gold recovery at the mill remained at 95%. The company realized an average of US$360 per oz. for its gold production, up from US$319 a year earlier.
During the quarter, the company replaced some senior management, changed its sampling procedures, and introduced the use of reverse-circulation drilling as a grade-control tool. The moves helped improve production levels by the end of the quarter.
Still, mining at the money-losing Sigma-Lamaque mine was suspended in early October. Milling of stockpiled ore continued until Oct. 21 to produce 3,124 oz. gold. The mill has since been closed until operations resume.
Mining consultant RSG Global says the complex could be restarted at a profit pending optimization of operations. RSG also suggests a $2-million drill program in anticipation of a revised resource estimate. At last report, reserves stood at 10.4 million tonnes grading 2.67 grams gold per tonne.
McWatters notes that a revival at Sigma-Lamaque would require additional financing. Toward that end, the company has agreed to sell the nearby Kiena mine complex on Parker Island, west of Val d’Or, Que., to
McWatters’ cash position at the end of the third quarter was $1.2 million.
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