Queenston builds gold assets but diversifies into copper,

Like most junior gold miners, Queenston Mining (TSE) is feeling the pinch of that metal’s low price and is now getting very much involved in copper.

For years this company’s activities have centred around the famed old Kirkland Lake gold camp where it has built up a substantial inventory of gold-in-the-ground. But it wants to see a US$400 price before reopening the McBean mill there, Hugh Harbinson, president and chairman, told a well attended annual meeting.

Total reserves on Queenston properties now approximate 7,800,000 tons grading 0.18 oz., of which the company’s net share amounts to 5,471,000 tons grading 0.19 oz. or just over 1,000,000 oz., the meeting was told.

One of the most promising is the Amalgamated property, under option to Battle Mountain (Canada) where drilling is to be resumed shortly. That company can earn a 70% interest by cash payments of $1.1 million and expenditures of $5 million, of which over $2.5 million has already been spent.

In something of a major departure and expenditure, Queenston recently purchased 3.2 million shares of Thermal Exploration (ASE) at 35 cents per share (now 60 cents). This company is developing the promising Williams Creek copper-oxide deposit in the Yukon.

Thermal’s joint venture partner in this project is Western Copper, an affiliate of Teck (TSE). It reports minable open pit reserves of 11.6 million tons grading 1.08% copper and 0.01 oz. gold amenable to the low-cost solvent extraction-electrowinning (SX-EW) process and slated to come into production in 1996.

Prefeasibility engineering work suggests an annual output of 25 million lb. copper at an operating cost of 60-65 cents per lb.

Thermal also holds a joint venture interest with Kennecott Copper in 97,000 acres in the Lac de Gras diamond play in the Northwest Territories. Queenston, controlled by Joutel Resources (TSE) and under the same management, has working capital plus investments exceeding $2.5 million and is debt-free.