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Gold/Mining/Energy : Alta Gold -- Ignore unavailable to you. Want to Upgrade?

To: Texas77 who wrote (701)	3/31/1999 11:54:00 AM
From: Mark Adams	Read Replies (1) \| Respond to of 749

They might pull it out of the hat. Running close to the edge, it doesn't take much to go wrong to push you over. It looks like ALTA had two things go wrong, startup problems at Olinghouse and recovery decline at Kinsely. But my bet is on another company picking up the assets for pennies on the dollar, leaving stockholders holding the bag. I sold my holdings in Alta, at a loss. This is the third Gold concern I've watched drift into the morass. At Dec. 31, 1998, Alta Gold's line of credit had been drawn to its maximum amount, the majority of its accounts payable were past due, production at Olinghouse was below expectations and available cash was limited, all of which required that the company's independent public accountants include a going concern qualification in their audit opinion. ''Although the start-up problems and permitting delays at Olinghouse have caused liquidity problems for the company, we still believe that Olinghouse will be a successful mining property,'' said Robert Pratt, president and CEO of Alta Gold. ''Production from Griffon, with cash costs of $149 per ounce, continues to generate positive cash flow. ''Additionally, since the first of the year, we have corrected many of the start-up problems which caused Olinghouse's production shortfall in 1998. As the result of our efforts, we have been able to reduce Olinghouse's cash cost of gold production from $432 per ounce in 1998 to $218 per ounce in February 1999 and, by the end of March, the gold recovery rate has more than doubled. These actions will result in a positive and accelerating improvement in Alta Gold's cash flow.'' Alta Gold is currently pursuing outside sources of capital, including equipment refinancing, sale or lease of assets, other debt or equity financing, and the sale of royalty interests. However, there is no assurance that the company will be successful in its efforts to obtain additional capital.