[LETTERHEAD] Trading Symbol: VGZ
Toronto and American Stock Exchanges
- ----------------------------------------------------------- N E W S ------------
VISTA ANNOUNCES 1999 RESULTS AND NEW ORE RESERVES AT HYCROFT
DENVER, COLORADO, MARCH 27, 2000 - Vista Gold announced today its results for
1999. The Corporation experienced a loss of $27.7 million for the year,
including $16.2 million in write-downs of mineral properties. The net loss
before write-downs was $11.5 million as compared to a net loss in 1998 of
$1.6 million.
SUMMARY RESULTS
(U.S. DOLLARS IN THOUSANDS, EXCEPT SHARE DATA)
YEARS ENDED DECEMBER 31
----------------------------------------------------
1999 1998 1997
----- ---- ----
Gold sales $ 19,496 $37,083 $ 40,123
Net loss before write-downs (11,481) (1,640) (5,292)
Net loss (27,700) (1,640) (54,019)
Net loss per share before write-downs (0.13) (0.02) (0.06)
Net loss per share (0.31) (0.02) (0.61)
CONSOLIDATED PRODUCTION
(OUNCES)
YEARS ENDED DECEMBER 31
----------------------------------------------------
1999 1998 1997
----- ---- ----
Gold 65,468 112,838 117,378
Silver 203,230 235,784 479,920
In 1999, the Hycroft mine produced 40,075 ounces of gold and 183,170 ounces
of silver. The cash operating cost was $277 per ounce of gold produced,
including changes in inventory. Excluding changes in inventory, the true cash
operating cost was $146 per ounce and the Hycroft mine generated $4.5 million
of cash from operating activities, net of $1.6 million in reclamation and
closure costs. Before reclamation and closure costs, the mine generated $6.1
million of cash. Mining activities at the Hycroft mine were suspended in
December of 1998. In 1999, the mine continued to produce gold from previously
mined and inventoried ore. The Corporation estimates that 2000 production
will be in excess of 12,000 ounces.
During 1999, Hycroft mine gold production consistently exceeded expectations
and as a result, the Corporation conducted a $0.6 million exploration program
to determine the extent of the remaining Brimstone gold resource. Studies
indicated that during the period of 1996 through 1998, gold production from
the north end of the Brimstone deposit exceeded planned production by 47,090
ounces, or 26%. A complete review of the mineral potential and re-estimation
of the Hycroft ore reserves and resources was completed. The new estimate
calculated total reserves and resources at Hycroft of 99.3 million tons at a
grade of 0.015 ounces per ton containing 2.13 million ounces of gold.
Contained in this resource are proven and probable reserves calculated at a
$275 per ounce gold price of 24.0
million tons at a grade of 0.021 ounces per ton containing 495,000 ounces.
This study also identified several areas not calculated in the resource
estimate where additional oxide ore can be expected based on an extrapolation
of known drilling information. The reserve and resource estimates were
carried out under the direction of Mr. Warren Bates, Exploration Manager for
Vista Gold and a qualified person under the TSE guidelines.
At the Mineral Ridge mine, gold production failed to meet expectations.
Mechanical difficulties together with ore deficiencies compared to the
estimated ore reserves impaired the mine's ability to produce gold and
generate cash flow. Various alternatives were considered and discussed with
Dresdner Bank AG; however, as a result of reduced production and a reduced
estimate of the ore reserves, the cash flow estimates failed to meet the loan
agreement convenants. With no viable alternative, the Company ceased
operations and its wholly-owned subsidiary, Mineral Ridge Resources Inc.
("MRRI"), sought protection under the U.S. Bankruptcy Code. Vista Gold has no
liability for the debts and obligations of MRRI.
In Bolivia, the Corporation recently completed a feasibility study on the
Amayapampa project. Based on a gold price of $300 per ounce, the proven and
probable reserves at Amayapampa are calculated to be 10.2 million tons (9.3
million tonnes) grading 0.051 ounces per ton (1.8 grams per tonne) including
dilution, containing 526,000 ounces of gold. The ore reserves were estimated
by Mine Reserve Associates, an independent mining consultant.
At year-end, the Company had working capital of $3.0 million and cash of $2.3
million and believes that its current cash on hand is sufficient to continue
producing gold from previously mined and inventoried ore at the Hycroft mine.
However, the Corporation will have to raise additional funds from external
sources in order to restart mining activities at the Hycroft mine or begin
construction and development activities at the Amayapampa project in Bolivia.
Accordingly, the Corporation is actively investigating various financial
alternatives, including debt financing, the issuance of equity and mergers
with other companies.
Vista Gold's ore reserves and resources are tabulated below.
- ----------------------------------------------------------------------------------------------------------------------
GOLD RESERVES AND RESOURCES
- ----------------------------------------------------------------------------------------------------------------------
PROVEN AND PROBABLE RESERVES TONS GRADE CONTAINED OUNCES
- ----------------------------------------------------------------------------------------------------------------------
Amayapampa, Bolivia ($300/oz) 10,200,000 0.051 526,000
Hycroft Mine ($275/oz) 23,960,000 0.021 495,000
---------- ----- ---------
TOTAL 34,160,000 0.030 1,021,000
- ----------------------------------------------------------------------------------------------------------------------
MINERAL RESOURCES TONS GRADE CONTAINED OUNCES
- ----------------------------------------------------------------------------------------------------------------------
Amayapampa, Bolivia
Measured, Indicated and Inferred 1,692,000 0.052 88,000
Hycroft Mine, Nevada (0.005 oz/ton cut-off)
Measured and Indicated 47,400,000 0.016 776,000
Inferred 16,000,000 0.015 240,000
- ----------------------------------------------------------------------------------------------------------------------
RESERVES AND RESOURCES TONS GRADE CONTAINED OUNCES
- ----------------------------------------------------------------------------------------------------------------------
Amayapampa 11,892,000 0.052 614,000
Hycroft 87,360,000 0.017 1,511,000
---------- ----- ---------
TOTAL 99,252,000 0.021 2,125,000
- ------------------------------------------------------ ------------------- ----------------- -------------------------
Vista Gold Corp. is an international gold mining, development and exploration
company based in Denver, Colorado. Its holdings include the Hycroft mine in
Nevada, a development project in Bolivia, and exploration projects in North
and South America.
---
The statements that are not historical facts are forward-looking statements
involving known and unknown risks and uncertainties that could cause actual
results to vary materially from the targeted results. Such risks and
uncertainties include those described in the Company's Form 20-F as amended.
For further information, please contact Investor Relations at (303) 629-2450.