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Gold/Mining/Energy : Agnico-Eagle Mines Ltd. - AGE (U.S. AEM) -- Ignore unavailable to you. Want to Upgrade?

To: Robert J Mullenbach who wrote (266)	6/22/1999 8:00:00 AM
From: lwk	Read Replies (1) \| Respond to of 1612

Agnico-Eagle acquires El Coco Property from Barrick Gold TORONTO, June 21 /CNW/ - Agnico-Eagle Mines Limited ("Agnico-Eagle") announces the acquisition from Barrick Gold Corporation ("Barrick") of the El Coco Property ("El Coco") located adjacent to and immediately east of the LaRonde Mine. El Coco covers the eastern extension of the favourable geological structure that hosts all of the LaRonde ore deposits. Past exploration work at LaRonde and El Coco has identified a total resource of 2.4 million tons grading 0.23 ounces of gold per ton, of which 869,000 tons grading 0.37 ounces of gold per ton or approximately 322,000 contained ounces of gold is a possible reserve. The consideration paid by Agnico-Eagle to Barrick consists of a 50% Net Profits Royalty from future production on El Coco within an area that extends 500 metres from the property boundary with LaRonde. Included in allowable expenses in calculating this Royalty are all direct operating costs and capital expenditures on this portion of El Coco plus a pro-rated portion of future capital expenditures from the LaRonde Mine. Barrick also receives a 4% Net Smelter Return Royalty on future production from the remaining two-thirds of El Coco not subject to the 50% Net Profits Royalty. Agnico-Eagle is also paying the sum of US$4,000,000 representing an advance royalty payment recoupable from future net profit and net smelter royalty payments. "The El Coco acquisition is strategically important for Agnico-Eagle as it opens up this property for both near term gold production and underground exploration," said Sean Boyd, Agnico-Eagle President and Chief Executive Officer. An underground drilling program will begin immediately employing two drills, one from LaRonde's 20th level exploration drift (2,800 feet below surface) and one from Level 7 of Shaft No. 3 (3,600 feet below surface). This drilling program is expected to be completed in August and is designed to convert the 322,000 ounce possible gold reserve to probable ore reserves. This possible gold reserve is contained in a portion of LaRonde's Zone 20 South which extends into El Coco across the LaRonde property's southern boundary. Agnico-Eagle's exploration work to date has encountered Zone 20 South on the LaRonde property over a vertical distance of 4,000 feet to a depth of 7,000 feet below surface. "The portion of Zone 20 South on El Coco is easily accessible and can be developed and mined using Agnico-Eagle's Shaft No. 3. The high gold grades of the El Coco possible reserve and its accessibility to the LaRonde underground infrastructure indicate that the cash costs to produce an ounce of gold from this area can be very low. Production is expected to begin from El Coco in the first quarter of 2000," said Mr. Boyd. Agnico-Eagle is currently planning a long term exploration program for El Coco and its Sphinx Property immediately to the east of El Coco. These two properties cover over 3.5 kilometres of the geological structure that hosts all of the ore deposits along the Cadillac Gold Belt which is Canada's second largest gold producing region. Agnico-Eagle's exploration work will include an underground drifting and drilling program by extending the LaRonde Mine's 20th level exploration drift (2,800 feet below surface) across El Coco and Sphinx. This same exploration approach was instrumental in discovering LaRonde's Shaft No. 3 ore zones. With its LaRonde, El Coco and Sphinx Properties, Agnico-Eagle now controls over six kilometres of the established, and still growing Cadillac Gold Belt. This enlarged, strategically important land package puts Agnico-Eagle in a strong position to continue to increase value through further exploration success. This press release contains certain "forward-looking statements" (within the meaning of the United States Private Securities Litigation Reform Act of 1995) that involve a number of risks and uncertainties. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from those anticipated in such statements. Risks and uncertainties related to year 2000 conversion are disclosed herein. Other risks and uncertainties are disclosed under the heading "Risk Factors" in the Company's Annual Information Form (AIF) filed with certain Canadian securities regulators (including the Ontario and Quebec Securities Commissions) and with the United States Securities and Exchange Commission (as Form 20-F). Agnico-Eagle Mines Limited is an established Canadian gold producer with operations located principally in northwestern Quebec and exploration and development activities in Quebec, Ontario and Nevada. Consistently one of the industry's lowest-cost producers, Agnico's operating history includes 24 years of continuous gold production primarily from underground mining operations. Current proven and probable gold reserves stand at 1.3 million contained ounces, with an additional 3.3 million ounces in the mineral resource category at its LaRonde Mine. Agnico-Eagle is currently focused on the expansion and large scale exploration program of its LaRonde Mine which is expected to result in increased gold production and expanded gold reserves. For further information: Sean Boyd President and CEO Agnico-Eagle Mines Limited (416) 947-1212