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NEWS RELEASE TRANSMITTED BY CANADIAN CORPORATE NEWS
FOR: NORTH AMERICAN PALLADIUM LTD
TSE SYMBOL: PDL
NASDAQ SYMBOL: PDLCF
NOVEMBER 28, 1997
North American Palladium Ltd. Interim Exploration Results
Promising
THUNDER BAY, ONTARIO--North American Palladium Ltd. (NASDAQ &
TSE), today released the financial results for the Nine Months
ended September 30, 1997. The Company reported a net loss of
$18,851,000 or $1.60 CDN per share (1996 - loss of $8,303,000 or
$0.71 CDN per share), which included depreciation and amortization
of $6,051,000 (1996 - $1,481,000). The net loss for the three
months ended September 30, 1997 was $7,392,000 or $0.62 CDN per
share (1996 - loss of $3,414,000 or $0.29 CDN per share).
Cash expended on operating activities for the nine months totalled
$12,733,000 compared to expenditures of $4,484,000 for the same
period in 1996.
/T/
NORTH AMERICAN PALLADIUM LTD.
CORPORATE REPORT
(Canadian Funds in Thousands of Dollars
Except Share and Per Share Amounts)
Year Three Months Nine Months
Ended Ended Ended
December 31, September 30, September 30,
1996 1997 1996 1997 1996
Revenue from
metal sales $ 20,249 $ 5,055 $ 4,791 $ 13,342 $ 15,157
Income from
mining operations (22,152) (4,035) (1,957) (10,393) (4,033)
Net Profit (Loss) (28,730) (7,392) (3,414) (18,851) (8,303)
Average shares
outstanding
11,710,814 11,831,040 11,737,588 11,815,782 11,698,491
Net Profit (Loss)
per share (2.45) (0.62) (0.29) (1.60) (0.71)
Figures in parentheses are losses
/T/
The Company is currently operating a platinum group metals
property northwest of Thunder Bay, Ontario whose principal metal
is palladium. Fixed assets, mining leases and deferred
expenditures, net of depreciation and amortization, at September
30, 1997 totalled $59,731,000, $12,940,000 and $26,314,000
respectively.
The Company also reported a shareholders' equity of $24,476,000 at
September 30, 1997 as opposed to a deficiency of $6,868,000 as at
December 31, 1996 as a direct result of the Capital Reorganization
voted on at the Special Meeting of Shareholders held September 17,
1997. The conversion of demand debentures and promissory notes
into one term note (the second phase of the Capital
Reorganization) will not be realized in the Company's books until
the December 31, 1997 financial statements as the transaction did
not occur until mid-October.
OPERATIONS
The Company reported 221,978 tons of ore processed for the three
months ended September, 1997, a significant improvement over the
first and second quarter production of 171,829 and 160,652 tons
respectively. In addition to the higher tonnage milled, the
Company confirmed that in September, milling rates approaching
3,000 tons per day were achieved.
The Company also reported higher grinding rates since the start up
of the Secondary Crushing system in July and the commissioning of
the Primary crusher in mid-September as a steadier supply of feed
to the mill is now obtainable. Also, since the introduction of
the new Crushing facility, the volume of crushing has vastly
improved from approximately 170,000 tons in the first and second
quarters, to 228,778 tons in the third quarter and overall metals
produced has increased by 16 percent over the first quarter of
1997.
In commenting on the first quarters operating results since his
appointment as president, Mr. Amsden stated that "now that the
Capital Expansion Program has nearly been completed, Management is
focusing on reducing the cost of production at the Lac des Iles
project. Management is optimistic that with improved overall
production rate and implementation of new cost reduction measures
the Company is taking its first steps towards financial recovery".
EXPLORATION
The 5 hole program completed this summer on the "C" Zone indicated
that the mineralization extends to depths down to 750 feet and as
deep as 925 feet with estimated true widths varying from 85 feet
to 300 feet. Ore grade mineralization, assays varying from 0.091
oz/ton palladium to a high of 0.294 oz/ton palladium over various
widths were intersected. These results indicate that further
drilling is warranted in order to obtain enough data to calculate
additional ore reserves.
In October, seven holes were drilled to determine the southward
extension of the Roby Zone. The drilling delineated a lens which
attains a width of 100 feet at a depth of 350 to 400 feet. The
lens narrows both towards surface and to depth. Palladium assays
ranged from 0.11 oz/ton to a high of 0.301 oz/ton. Three more
holes are currently planned to investigate this lens.
Four holes were also drilled in the north-central part of the Roby
Zone to fill in large information gaps and extend mineralization
below the pit bottom. Intersections varying in length from 32
feet to 64 feet returned palladium values ranging from 0.071
oz/ton to 0.37 oz/ton.
Surface work on "D" Zone, overburden stripping and sampling, has
established a zone of low-grade mineralization with a strike
length of 300 feet and a width of 60 feet. Assays were in the
range of 0.3 percent copper, 0.3 percent nickel and 0.017 oz/ton
palladium. These results are similar to those of a previous drill
hole which intercepted similar mineralization 250 feet to the
north-west. The full dimension of the zone can now only be
determined by diamond drilling.
Trenching of the north-east projection of the Roby Zone exposed
the favourable zone to 1200 feet north-east of the pit. A
detailed magnetic survey was conducted in early November.
A prospecting evaluation of the South Claim Block showed that this
area is not worth pursuing further.
In commenting on the exploration to-date, Mr. Amsden indicated
that the Company was very encouraged by the results on the "C"
Zone and the South Roby Zone and pending further evaluation
believes that these areas would be instrumental in enhancing the
current ore reserves.
NOTE TO SHAREHOLDERS
The Company regrets to inform shareholders that as the Canadian
Postal strike continues the third quarter financial and update
reports will not be forwarded. In lieu of the above the Company
would like to extend its invitation to shareholders who would like
to personally pickup a copy of the report or would like to have
the report faxed or emailed. Please call (807) 345-4479 should
you wish a copy or email the request to [email protected].
(please remember to state which word processor and version you are
using). The reports will be mailed once the postal service
commences.
/T/
PRODUCTION STATISTICS - 1997
Production: Third Quarter Second Quarter First Quarter
Palladium (troy oz.) 13,811 13,538 12,179
Platinum (troy oz.) 1,074 942 804
Gold (troy oz.) 875 905 778
Copper (lbs) 251,862 218,515 199,501
Nickel (lbs) 194,188 182,589 172,232
Tons Ore Mined 229,659 284,473 179,633
Tons Ore Crushed 228,778 169,152 170,779
Tons Ore Milled 221,978 160,652 171,829
Tons Concentrate
Produced 2,627 2,279 2,158
/T/
-30-
FOR FURTHER INFORMATION PLEASE CONTACT:
North American Palladium Ltd
Michael P. Amsden
President
(807) 345-4479
(807) 345-7796 (FAX)
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