Cross Lake shares tumble
on poor results
By PETER KENNEDY
Vancouver Bureau The Financial Post
Shares of Cross Lake Minerals Ltd. tumbled yesterday
after the widely watched junior miner tabled uneconomic
drill results from a Timmins, Ont., base metal discovery.
The stock (CRN/VSE) dropped $1.70 to $2.07 on volume
of more than four million shares after the company
released metal values in six new holes from its
Sheraton-Timmins property.
Analysts attribute the decline to Cross Lake's inability to
match impressive results released in October, which sent
shares soaring above $6.
Cross Lake, which has about $4 million in cash and 30
million shares outstanding, is drilling for base metals on
what is known as a volcanogenic massive sulphide system.
Earlier results, which included a 33-metre rock
intersection, averaging 6.71% zinc, 1.86% lead and 3.12
ounces of silver a tonne, raised speculation
Sheraton-Timmins could rival the huge Kidd Creek
copper-zinc mine nearby. Values in the latest batch of
holes came nowhere near to matching those high levels.
Among the best results released yesterday was a 24-metre
section averaging 2.16% zinc a tonne.
Companies active on adjacent properties were also hit by
the news. Golden Knight Resources Inc. (GKR/TSE),
which recently bought one million Cross Lake shares at
$4.15 each, eased 35› to $2.60. East West Resource
Corp. (EWR/VSE) fell 13› to 51›, while Canadian Golden
Dragon Resources Ltd. (CGG/VSE) dropped 23› to 42›.
"The market is reflecting what are basically uneconomic
grades,'' said Dorothy Atkinson of Whalen Beliveau &
Associates Inc. in Vancouver.
However, analysts say it is still too early to say whether
Sheraton-Timmins will prove to be a mine. "Grades could
pick up as they drill deeper,'' Atkinson said.
Cross Lake has completed only 10 drill holes and expects
to do another seven before taking a Christmas break.
"We are trying to trace a system that is geologically
complex,'' said chairman Henry Ewanchuk. "I'm still
cautiously optimistic.''
Mr Metals
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