Homestake to Close Its Oldest Gold Mine
Homestake Mining Co., the nation’s second-largest gold producer, said it will take a one-time $43-million charge in the third quarter to close its oldest mine. It comes as gold prices hover close to 20-year lows.
Homestake, based in Walnut Creek, Calif., has mining operations in the U.S., Canada, Australia, Argentina and Chile.
The company said it will close its 124-year-old gold mine in Lead, S.D., over the next 16 months. The 362 workers there will be fired, beginning in December. The mine produced 213,000 ounces of gold in 1999, or about 9% of Homestake’s total.
Gold futures have dropped 5% this year. The December contract closed at $273.10 an ounce Monday on the Comex division of the New York Mercantile Exchange. Futures hit a 20-year low of $253.20 in July 1999.
Homestake shares have lost 23% of their value in the past year. The shares were unchanged Monday at $6 on the New York Stock Exchange.
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