Bad news from Cusac: Cusac Gold Mines Ltd.: Cusac Reports Q1 2007 Results
Vancouver, British Columbia CANADA, May 16, 2007 (M2 PRESSWIRE via COMTEX) -- Cusac Gold Mines Ltd. (CQC - TSX, CUSIF - OTCBB), reports that during the three month period ending March 31, 2007 the Company posted a net loss of $1,884,379, or $0.03 per share. The loss is attributable to significantly lower than expected gold production from the Rory Vein at the Company's Table Mountain Property, due mainly to structural and mineralogical complexities previously reported on March 23, 2007. During the quarter the Company processed 3,503 tons of ore with an average grade of 0.109 ounces per ton gold, resulting in production of 319 ounces of gold and revenue of $193,758 (net of treatment and refining charges). Subsequent to March 31, the Company processed an additional 2,688 tons at an average grade of 0.141 opt gold producing an additional 315 ounces of gold.
In light of the low tonnage and grades experienced at the Rory Vein, the Company has initiated a review of the structure, including ongoing drilling, to better understand and define the resource. In the meantime, the Company has remobilized all mining staff and equipment to the East Bain Vein, where a probable reserve of 28,000 tons grading 0.50 opt gold (14,000 ounces) has been outlined. The East Bain is an extension West Bain, where Cusac mined 60,000 tons of ore grading 0.40 opt gold between 1993 and 1995. Until the review of the Rory Vein is complete, the Company is reducing its forecast production to 14,000 ounces for 2007, representing production from the East Bain Vein, expected to commence in the 3rd quarter of 2007. The Company has also reduced its work force at the mine site during the East Bain Vein development period.
"The Rory Vein has been a very frustrating experience for Cusac," said Cusac CEO David H. Brett. "The Rory is a north-striking vein that lies at 90 degrees to the east-west trend of all the rest of the high-grade gold veins in the district. When we encountered the Rory underground, we found it to be disrupted by numerous faults, and the gold grades and continuity were not nearly as consistent as we have come to expect from past experience. We are therefore driving towards the more predictable, east-west striking East Bain orebody, an extension of the highly productive West Bain Vein, where the bulk of the probable reserves lie. We are still very hopeful that with more drilling and other information we will be able to reopen the Rory Vein for mining later in the year."
Cusac Director George Sanders, P.Geo is the Qualified Person under national Instrument 43-101 for the technical portion of this News Release. To review the Company's unaudited 3 months financial statements to March 31, 2007 and accompanying Management Discussion and Analysis, please visit www.sedar.com.