Niobec reserves grow again

Lower production costs and a higher recovery rates have allowed equal partners Cambior (CBJ-T) and Mazarin (MAZ-T) to again boost reserves at the Niobec niobium mine in Quebec by including some slightly lower grade material.

Proven and probable mineral reserves now stand at 22 million tonnes averaging 0.67% Nb₂O₅, compared to 18.2 million tonnes running 0.68% at the end of 2001.

The bulk of the increase is in proven reserves, which climb to 14.6 million tonnes grading 0.64% Nb₂O₅, from 11.7 million tonnes of 0.65%. Probable reserves have increased to 7.4 million tonnes of 0.71% Nb₂O₅, from 6.5 million tonnes of 0.72% Nb₂O₅.

The update reflects additional drilling and an independent rock mechanics study.

The partners note that 90% of the reserves are situated above the 1450-ft. level and can be mined using the mine’s existing underground infrastructures. The new reserve is enough to keep the mine running for close to 18 years at the current mining rate. The partners are confident reserves can be expanded further at depth.

During the first half of 2002, Niobec pumped out 1642 tonnes of niobium, a 14% increase over a year earlier. The mine received certification of its environmental management system (EMS) under the ISO 14001 standard during the second quarter.

In other news, Mazarin plans to buy back up to 2.2 million, or about 5% of its outstanding shares for cancellation. The one-year buyback period began Sept. 25.

With mining at the Omai open-pit gold mine in Guyana slated to finish by the end of 2005, Cambior is readying for construction at the Rosebel open-pit gold project in Suriname later this year. The project’s initial price tag of US$95 million, will be covered by cash on hand and cash flow over the next 18 months. The company is also in talks aimed at increasing an existing credit facility by about US$45 million to cover the balance.

Rosebel’s reserves are pegged at 36.9 million tonnes running 1.63 grams gold per tonne, equivalent to 1.9 million contained ounces of gold.

Cambior posted a second-quarter net loss of US$3.1 million (or US2 per share) on revenue of US$48.7 million, compared with a loss of US$10.9 million (US12 per share) on US$49.9 million a year earlier. Mazarin turned in a net loss of $1 million (2 per share) on revenue of $11.7 million, compared with year-ago net earnings of $182,000 (nil per share) on $11.2 million.