Trading Summary (October 01, 2002)

Toronto’s gold stocks suffered a US$2.80 fall by the yellow metal to US$321 per oz. in New York on news of a possible arms inspector deal in Iraq on Tuesday. The TSX’s Gold Index dropped 4.76 points or 2.6% to 181.31. The Diversified Metals & Mining Index managed to grab 2.58 points to tally to 112.15. Overall, the S&P/TSX Composite Index gained 38.19 points to reach 6,218.61.

No surprise, Canada’s big three gold producers all put in losses. Placer Dome was the most active dropping 34 to $14.21 with about 3.8 million shares traded. Barrick Gold fell 15 to $24.60 and Kinross Gold shed 31 to settle at $3.18. Barrick was recently forced to revise downward its guidance for third-quarter and full-year 2002 earnings on lower-than-expected production and higher costs.

The red ink spilled into the lower ranks with larger percentage losses seen by: TVX Gold, off 2.15 or nearly 10% at $20.33; TVX’s merger partner, Eco Bay Mines, down 13 or 7.3% to $1.65; and Miramar Mining, which slid 13 or 8.5% to $1.40.

Amid the beatings in the gold sector today, Crystallex International managed to drop only a nickel to $2.25. The junior announced that “transition arrangements have been substantially completed” and that it has taken possession of the Las Cristinas 4, 5, 6 & 7 properties in Venezuela, in accordance with an agreement signed on September 17, 2002 with government-owned Corporacion Venezolana de Guayana (CVG).

The company also announced it was undertaking roughly US$15-million-worth of private placements comprising a variety of convertible debentures and warrants. Most of the proceeds are funding the acquisition from the CVG of assets related to Las Cristinas.

Alcan retained its title of busiest base metal miner adding $1.26 to make $40.51 with about 1.6 million shares on the go. On Tuesday, Alcan countered concerns that China will not flood the global market with aluminum, saying that the country is not likely to become a net exported of the metal for many years.

Shares of Canadian coal miner Fording retreated $1.07 to $22.30 as the company warned that its metallurgical-coal sales volumes for this year will fall by 1 million to 13 million tonnes. Fording blames the decline on two factors: a failure to secure a large sale of metallurgical coal into Turkey; and an overall lower sales outlook. Fording also said that its sales price would be between $62 and $63 per tonne for the year, down from $64 per tonne.

Swedish miner Boliden plummeted 50 or more than 18% to $2.25. The company is seeking at least E107 million in damages from Spanish construction company Grupo Dragados in relation to the 1998 failure of a tailings dam at the Los Frailes mine in southern Spain. Last November, a criminal cleared Boliden of all responsibility, but that hasn’t stopped the Spanish Ministry of Environment from making a EUR45 million claim against Boliden for costs of the recovery efforts following the failure.

On the diamond watch, Tahera shot up 2.5 or about 18% to 16.5 after the company completed a private placement of about 6 million shares at 16.7 apiece with Kennecott Canada Exploration. Tahera plans to apply part of the $1 million in proceeds to permitting of the wholly owned Jericho diamond project in Nunavut.

Canada’s junior exchange continued to drift lower. The S&P TSX Venture Exchange composite index lost 1.84 points or 0.2%, and closed at 949.46.

Ontzinc was the most actively traded junior explorer, gaining 6 to close at 12 on 890,475 shares. The company is in the midst of acquiring the remaining 50% interest it does not own in the Scotia zinc mine near Halifax, Nova Scotia.

A big percent loser, New Guinea Gold dropped 2 to close at 5 on 225,000 shares. The junior has been working the Normandy Island gold properties in Papua New Guinea.

International Wayside Gold Mines ended the session flat at 11 on 204,000 shares. The Frank Callaghan-led company has been trying to advance the Bonanza ledge discovery on its Cariboo gold project near Quesnel.