MIRAMAR MINING CORPORATION ANNOUNCES INTENTION TO
REDUCE PRODUCTION AT THE CON MINE IN YELLOWKNIFE
VANCOUVER, Dec. 29 /CNW/ - Miramar Mining Corporation
MAE - TSE, VSE
MAENF - NASDAQ
Miramar Mining Corporation announced today that in response to continued
low gold prices and high operating costs, it intends to reduce production from
the Con Mine in Yellowknife to 600 tons per day from the current 1200 tons per
day. As a result, gold production in 1998 is expected to be between 70,000
and 80,000 ounces.
The Company plans to focus mining in those areas where reserves have been
significantly developed, resulting in lower mining costs. The Company also
intends to reduce mill operations to match the flow of ore from the mine
leading to better utilization of power from the mine's own generating
facilities which is expected to result in significant cost reductions. As a
result of these actions, the Company plans to eliminate approximately 130
staff and hourly positions from the current employee base of 340.
Continuing efforts to reduce costs will include eliminating exploration,
ongoing development and non-essential capital expenditures at the Con Mine. As
well, discussions will be held with local and territorial government officials
in order to examine the impact of tax burdens and costs related to the mine.
Miramar will be re-evaluating the current proven and probable reserve
base at the Con Mine in light of continued low gold prices, with the
expectation that the reserve base will be reduced, with a reclassification of
a significant portion of the current reserves into the resource category.
As a result, the Company is considering a write-down against the Con Mine
asset values, such write-down to be determined by the Board.
Miramar Mining Corporation remains financially secure with consolidated
working capital of $122 million at the end of the third quarter of 1997.
Miramar also owns 53.9% of the shares of Northern Orion Explorations Ltd., a
TSE listed company focused on the exploration and development of mineral
properties in Latin America.
-------------------------------------------------
Miramar is acting like a company whose output isn't hedged. Why are
doing all this if they're hedged?
Bear |
