Armed with a preliminary banking agreement,
The junior negotiated a US$15-million loan in January, and the banks must conduct due diligence before signing a final agreement.
The company is also attracting the attention of multi-lateral banks interested in developing the economy of the department of Potosi, near where Amayapampa is situated.
Vista’s president, Michael Richings, acknowledges that this is not the best time to build a mine, what with gold below US$300 per oz. But he says the company cannot wait for a return to higher prices: “We have to live with what gold is today.”
Early in 1998, the company closed out its hedge position and restructured the Hycroft gold mine in northern Nevada, only to shut it down at the end of the year. The company then sold off several assets, and reduced its exposure in Ecuador, decreasing its stake in
“We are doing everything we can to move Amayapampa forward,” says Ronald McGregor, Vista’s vice-president of operations.
The company estimates that the project will still be profitable at US$300 per oz. gold. In 1997, a revised feasibility study pegged cash costs at US$150 per oz., throughput at 1,500 tonnes per day, and gold production of 37,000 oz. per year.
Reserves at Amayapampa stand at 527,000 oz. gold in 8.9 million tonnes grading 1.8 grams per tonne.
Vista expects to complete funding for Amayapampa by the end of the second quarter. Capital costs stand at US$23 million, and construction is expected to last one year.
Vista pays as much as US$1.3 million in annual holding costs in Bolivia for Amayapampa. The costs cover lease fees, security at the site, and an office in the capital of La Paz, as well as 299 employees in the country. Most of the locals at Amayapampa are paid only a subsistence allowance, roughly equal to the Bolivian minimum wage.
Meanwhile, at Hycroft, Vista expects to produce 25,000 oz. in 1999 from continued heap leaching. In 1998, Hycroft cranked out 112,700 oz. gold and 236,000 oz. silver.
The company also expects to pull 55,000 oz. from the newly acquired Mineral Ridge mine, also in Nevada, The mine is to be returned to production using workers and equipment from Hycroft. In December 1998, Vista started a drilling program aimed at adding reserves to Mineral Ridge.
At year-end, the company had US$6 million in cash and bullion, and had sold forward 100,000 oz. of production from Mineral Ridge at US$330 per oz.
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