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Gold/Mining/Energy : Breakwater Resources (T.BWR) -- Ignore unavailable to you. Want to Upgrade?

To: Gunnar who wrote (784)	3/15/2000 5:54:00 PM
From: Stephen O	Read Replies (2) \| Respond to of 962

BWR is paying net $53 million Cdn for two mines that last year produced $25 million in Cash flow, one hell of a good deal.

To: Gunnar who wrote (784)	3/16/2000 1:47:00 AM
From: John Sladek	Respond to of 962

Gunnar, In their year end report, BWR stated that their ore reserves were as follows: After mining and milling 2.2 million tonnes of ore during the year, proven and probable reserves increased from 15.0 million tonnes at the beginning of 1999 to 15.9 million tonnes at year-end. Total resources, which include proven and probable reserves, increased from 25.5 million tonnes to 26.5 million tonnes. ... One of Breakwater's major objectives in the year 2000 will be to again increase reserves. Accordingly, the exploration budget has been more than tripled to $10.0 million. Subsequent to the year end, they announced the exploration results at El Toqui... The results to date confirm the presence of a very large and continuous zinc mineralized manto and that there is a large resource picture developing. Additional drilling is underway and a 30,000 metre diamond drilling contract has recently been awarded. As a result of the success to date in expanding the reserves and optimism for further significant additions to reserves, engineering work to expand the El Toqui operations by a minimum of 25% to 1,500 tonnes per day has begun. With these new mines, more than 10MM tonnes of proven and probable reserves have been added. I combine the tables from the annual report and the table in the press release and did a quick calculation of the P&P reserves and zinc grade assuming that the Cambior deal closes. ================================================================ Tonnes Zn Pb Ag Au Cu (000's) (%) (%) (g/t) (g/t) (%) ---------------------------------------------------------------- Nanisivik 2,710 8.1 0.4 36 Bougrine 2,694 11.9 2.3 - El Mochito 3,127 7.3 1.6 73 El Toqui 1,415 7.9 - - 0.4 Caribou 5,057 6.5 3.4 90 ---------------------------------------------------------------- Total 15,003 8.1 2.0 52 ---------------------------------------------------------------- Bouchard-Hebert 5,274 4.73 - 38.3 1.2 0.71 Langlois 5,610 9.45 - 43.4 0.1 0.56 --------------------------------------------------------------- Total 25,887 7.7 ================================================================ Note: these are my own personal calculations, so take them as you will. Also this does not take into account reserve additions that will result from the ongoing program at El Toqui. These new mines should help a lot with replacing the Nanisivik production in the event that no additional ore is found there. Some info (somewhat dated) on the new mines can be found on the Cambior web site at: cambior.com cambior.com Actual production data for 1999 can be found here: cambior.com If BWR's management hadn't put the company on a solid financial and operational footing, they might have been the seller rather than the buyer. Regards, John Sladek