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Gold/Mining/Energy : International Precious Metals (IPMCF) -- Ignore unavailable to you. Want to Upgrade?

To: reg who wrote (26534)	11/15/1997 7:56:00 PM
From: GOLDIGER	Read Replies (3) \| Respond to of 35569

Dear reg, This does not sound very good for the whole mining sector. Saturday, November 15, 1997 Gold hits the skids As price of gold sinks below US$300 an ounce, a 12-year low, high-cost producers close more mines and take other drastic steps to survive Fund managers pick over golds as bullion drops By PAUL BAGNELL Mining Reporter The Financial Post The price of gold sank below US$300 an ounce Friday, further pressing high-cost producers into drastic steps to ensure their survival. One such producer, Pegasus Gold Inc. of Spokane, Wash., said Friday it is at risk of not meeting debt obligations after taking a writedown of US$353.3 million on an Australian mine where it is suspending operations. Curtailing mining at other sites is also possible, it said. Royal Oak Mines Inc. of Kirkland, Wash., also said it was slashing costs to not imperil its ability to continue development of a low-cost mine in British Columbia. Campbell Resources Inc. of Toronto said Thursday it was closing its Santa Gertrudis mine in Mexico. The company has also delayed development of a new Panamanian mine. The spot price of gold in New York closed at US$303.70 Friday, down US$4.50 from Thursday. The price sank to US$299.25 in morning trading. The last time gold closed below US$300 an ounce was Feb. 25, 1985. On the Toronto Stock Exchange, the gold and precious minerals subindex was down 209.27 points, or 3.1%, and closed at 6535.36. Once again, fear of more gold sales by central banks was blamed for the selloff. Predictions of low U.S. inflation offered investors another reason to dump bullion. Germany's central bank, the Bundesbank, confirmed Friday it has been lending some of its gold reserves. Investors took that as a further sign central banks are cooling to gold as a store of value. Since July, when the price of gold plunged sharply on news of a sale of bullion by the Australian central bank, analysts have pointed to Royal Oak, Pegasus and Echo Bay Mines Ltd. as companies whose existence was threatened by a prolonged period of low gold prices because they are high-cost producers. On Nov. 4, Echo Bay declared a US$310-million writedown on its mine sites, dropping its asset value to US$483 million from US$940 million a year earlier. Pegasus said Friday it has halted mining at its Mount Todd gold mine in Australia. The mine has an average cash cost of production of US$370 an ounce. The US$353.3-million writedown - equal to $8.55 a share - has put Pegasus in breach of terms of a US$150-million revolving line of credit, the company said. "As a result of this writedown, the company is in default of certain restrictive covenants," Pegasus said. The company is in talks with its lenders and is working with restructuring specialists to find ways to survive low gold prices. Creditors, however, could put the company out of business, it suggested. "Absent adverse action by its creditors, the company has sources of liquidity to continue planned operations through 1998." Meanwhile, Royal Oak said it will cut back mining at its Pamour mine in Timmins, Ont., and its Giant mine in the Northwest Territories. Mining at the sites will only be done in areas of high-grade ore that can be profitably extracted with a gold price of less than US$300, the company said. Royal Oak will cut jobs to reduce its spending but did not say how many. The company is staking its future on the Kemess gold-copper mine in B.C., which it says can produce gold at US$79 an ounce, assuming a copper price of US$1 a pound. The mine, expected to cost $430 million, is 70% complete. Earlier this year, Royal Oak closed its Colomac mine in the Northwest Territories and the Hope Brook mine in Newfoundland. It has also put several mine development and late-stage exploration projects on hold. Both Royal Oak and Pegasus made their announcements late Friday. Campbell Resources is putting its emphasis on the Joe Mann mine in Quebec, said spokesman Steven Dawson. If PGU goes under it will be a very bad sign for the mining industry. GOLDIGER.

To: reg who wrote (26534)	11/16/1997 2:34:00 PM
From: Chuca Marsh	Read Replies (1) \| Respond to of 35569

Murat Kuntel over at Compuserve has allowed me to post this : Charles, Thank you for your e-mail. Here is what I say which I posted at the S-10 of Inv. Forum of Compuserve. Regards. <<Dear Folks, I remember reading a post with similar headline after the June meeting when IPM announced .85 ounce/ton gold + PGM. At the next trading day the market sold off. The reason: BD wa supposed to say that for IPM, not IPM alone. The issue was credibility and IPM did not have it. Yesterday we received the long awaited PR from IPM in which Bateman, a third part confirming chain of custody agreeing that there was gold + platinum + even silver. The average gold grade is about 0.03 not as reported by IPM in June 0.25. Previously unrementioned/nonexistent silver grades were above 1.0, a major plus. Because the market was still waiting for (1) a 0.85 gold+PGM or 0.25 gold alone type of PR (2) confirmed with BD or Batemen and we got (2) the confirmation o.k. but not (1) the gold amount in line with expectations, Monday will be a sell off for sure. Though I will be delighted that I am wrong.<g> But, it is only now; not in June, but now, we can say that IPM is for real. What makes IPM real is not the "amount" of gold, but "the existence" of gold + other PM. The reason is IPM has been slam dunked by major players of media as a scam. Forbes printed picture of Furlong with paint brush in his hand painting the rocks in Arizona with gold, something like Bre-X did. Arizona Dept of Mines claimed that there was no gold in Arizona. Bloomberg reported that as news. So, IPM was a liar in their mind and they warned the investors that every penny they invest would be not for gold but for Desert Dirt alone. Now, all that has been proven false. There is a third party now signing its name on the chain of custody that not only there is gold, but also silver and platinum. Therefore, IPM is not a scam but for real. The numbers given to us are lower than what we have been told by IPM. There are many questions to ask to IPM still. But, it does not change the fact that there is gold in Arizona which AZDOM itself had no idea of and was talking bluntly against a company and murdering its reputation with their arrogant talk of nonsense and claiming that there was no gold. I wish IPM sent them a copy of their PR. The amount of gold is not written on the stone. The assay is for to prove that there is gold there. The amount IPM reports is almost the same amount of gold found in Nevada. So, it is not too little. Plus, almost always the actual recovery of gold is greater than the amount assay gives. What we have in our hands is the worst case, and I like it. IPM is for real now. But, we, the ones who wished to be rich quick, are disappointed. Because we shall not be rich as quick as we wanted to be. In fact, next week we shall be poorer, at least on the paper. IPM is changing from a "get-rich-quick" scheme into a "speculative investment" which will need "as usual" patience. But, for sure IPM is not Bre-X. IPM did not salt the dirt. It is not IPM but AZDOM gave us the false information regarding the existence of gold in Arizona. I am going to sail with IPM. I am confident with them. IPM with this determination for success despite even government agencies working against them, with this amount of perserverence they have, will for sure bring this work into completion. Enjoy the company if you do not need cash urgently. Murat Kuntel>> Following is another example of E-Mailed Wisdom from another S.I.er that I want to share re sell off possibility: (no credit givena as it needs to be said!:) I was thinking at first of dumping on the opening and then picking up again once the bottom hit, say $(I decided to leave this GuesstamitRangeOUT-CmDecisiontoEDIT) -- but really that's risky and probably none too smart. Nobody really knows what's going to occur, and it will be a wild ride of the faint of heart and especially for the stupid and short-sighted... A lot of fear and a lot of greed is about all we can be sure of.....I suspect the big boyz and institutions are smacking lips waiting for cheap paper to roll around so that they can scoop up a bundle. Don't think for a minute that they are unaware of the situation. My guess is that any institutional money manager knows it's futile and even stupid to dump, say 200K shares or 400K shares during a bloobath. They will only be pouring gasoline on the fire and thus they'll end up with 80 cents a share for their trouble....No, they will be doing the following: they will be slightly anxious, but are, after all professionals and have seen this kind of thing before. They will BUY when the little fraidycats dump and then they will dollar-cost-avaerage upward...why - because it's the ONLY moneymaking [or at least not money-losing] weapon they have in their arsenal.....so if the price goes down in a thinly traded stock you own a lot of - buy more, period....This is of course in this case is coupled with the news which, forget the whining and moaning - is only good - in the final analysis, and that doesn't even take into account the better numbers, the news on Pt, the recovery rates...etc so my prediction is that if you dump on Monday and get $(X CmEDIT) or if you're lucky $(X less some $ figure-CmEDIT), you will feel very chagrined on Thursday when the stock recovers [thanks to the institutions] at $(CmEDIT or 50 Cents more than that) or better.....no, don't do it....it would be a mistake.....IMHO...oh, the other thing -- when the institutions buy more, that insures once again they're [have to be] in it for the long haul - another lock on the box......if you cannot buy more on Monday once the bottom [which might be way higher than some of us may susect]...then sit back and watch the fireworks.....this is a mine, and it has the goods and you will make money sooner than you think.. Name LEFT OUT TO PROTECT THE INNOCENT- The same Innocent Scared People holding IPM is the REASON I AM POSTING these words of Wisdom!!! Sorry for rambling...we all needed to see this..Chucaupt2(A mine!)