New Britannia weighs on High River

High River Gold Mines‘ (HRG-T) gold production slipped by 15% to 118,182 oz. in 2003, as operations at the 50%-owned New Britannia mine in Snow Lake, Man., wind down.

Meanwhile, the company’s attributable total cash costs for the year are estimated at US$235 per oz., about 30% higher than in 2002. Increasing costs at New Britannia are mostly to blame.

During 2003, New Britannia produced a total of 70,002 oz. (35,001 toward High River’s account) at a total cash cost of US$329 per oz. That was 24% lower than budget as mill throughput and head grades were lower than expected. The mine sold its production for US$359 per oz.

New Britannia began producing in 1949, and by its closing in 1958 produced more than 600,000 oz. The mine reopened in 1995 to produce another 700,000 oz. by the end of third quarter of 2003.

High River and partner and operator Kinross Gold (K-T) figure the mine will continue run at least until the end of the year. The partners will then consider the feasibility of an exploration program aimed at further extending the mine’s life.

Meanwhile, the company’s 54.1% stake in Buryatzoloto netted it 83,181 oz. of gold, off 2,195 oz. from 2002 as High River stake in the Russia producer fell slightly in 2003.

In all, Buryatzoloto, which operates the Irokinda and Zun-Holba mines in the Buryat autonomous region in Russian Siberia, produced 153,754 ounces at an estimated total cash cost of US$195 per oz., a shade better than the 153,377 oz. produced at US$164 apiece in 2002.

The higher costs reflect a transition to shaft mining using the cut-and-fill method at Zun-Holba. A stronger Russian rouble also negatively impacted costs. The company realized an average of US$358 for each oz. sold.

Looking ahead, High River expects both the Taparko gold project in Burkina Faso, West Africa and the Berezitovoye gold project in the Amur Oblast in southern Siberia, Russia to begin open-pit mining and conventional milling operations in the fourth quarter of 2005.