News release! So much for the no news until next year.
( BW)(GOLDEN-EAGLE-INTL)(MINE) Golden Eagle Negotiates
Open-Pit Mining Contract to Increase Production Levels
Business Editors
DENVER--(BUSINESS WIRE)--Dec. 11, 1997--Golden Eagle International, Inc.
(NASDBB: MINE) announced today that its majority-owned subsidiary, Eagle Mining
of Bolivia, Ltd., has negotiated the terms of an open-pit mining contract to increase
production levels at its Cangalli, Bolivia, gold mining operation.
Golden Eagle will scale down its shaft mining operations due to less-than-expected
production results and the lower cost of operating open-pit mines. Golden Eagle's third
quarter production totaled 5,605 grams of gold with a value of US$56,760, while
October production amounted to 3,255 grams of gold with a value of $31,395. Total
fourth quarter projections indicate a 66% quarterly increase over third quarter figures.
"With gold prices at all-time lows, we believe the low cost of open-pit mining will help
improve the Company's cash flow and position Golden Eagle for aggressive expansion
in the future," said Terry Turner, President and CEO of Golden Eagle International, Inc.
The mining contract is with Ingenieria de Servicios Profesionales, S.R.L. (ISP), an
engineering and earth moving company located in La Paz, Bolivia. The contract calls
fora 24-hour-per-day operation employing three 25-ton dump trucks, one 15-ton dump
truck, one 950 Caterpillar front-end loader, one 930 Caterpillar-equivalent front-end
loader, two 15-ton dump trucks on standby, and various compressors, generators and
support equipment. ISP's equipment would be added to Golden Eagle's current rolling
stock, which includes two D85 Komatsu bulldozers, one leased 950
Caterpillar-equivalent front-end loader, one 930 Caterpillar front-end loader, and two
leased 6-ton dump trucks. ISP's calculations, because of the short haul distance, fixed
the daily production of the entire operation at 8,000 to 10,000 tons of head material per
day.
Golden Eagle management noted that the ISP contract will be executed once efforts
to improve the Company's fine gold recovery process are completed. The Company's
Cueva Playa open-pit mine site is currently undergoing modifications, including the
installation of a new flow-sheet, to increase the levels of fine gold recovery.
Guido Paravicini, M.A., Eng., an independent mining engineer and geophysicist hired
by the Company to perform geological evaluations of the Cangalli property, has
projected that, with a conservative calculation of 2 grams per ton (g/t) of recoverable
gold, daily gross production from Cueva Playa could reach 500 to 650 troy ounces of
gold (approximately US$150,000 to US$200,000 per day at US$300 per ounce). ISP
and Eagle Mining of Bolivia, Ltd. have conservatively estimated that combined
operating costs would not exceed 40% of gross sales, resulting in daily net revenues of
approximately US$90,000 to US$120,000, or monthly net revenues of US$2.25 million to
US$3million. (The Company cannot guarantee that Mr. Paravicini's projections are
accurate, nor that they will necessarily result from the ISP contract.)
"The ISP contract would be the production leap we have needed as we move our
emphasis away from our shaft operation toward more efficient open-pit mining
methods," said Turner.
In addition, the Company's subsidiary reports that it is in compliance with its contract
with the United Cangalli Gold Mining Cooperative and continues to work closely with
the Cooperative's leadership.
Golden Eagle International, Inc. is a Denver-based gold mining and exploration
company. The company is currently focusing its efforts on developing the mining rights
it owns in Cangalli, Bolivia. For more information about the Company call Sabrina
Martinez at 303/694-6101 or Guy Murrel at 303/581-7760. |
