CASSIAR ASBESTOS CORPORATION LIMITED

SALES

The market for all grades of fibre was strong throughout the year. The company’s sales exceeded
production and by the year end, fibre inventories were reduced to a minimum working level.

The forecasts from customers of their 1967 fibre requirements indicate continued growth. When
capital funds, which have been severely restricted during the past year, particularly in North America
and the United Kingdom, become more readily available to support renewed housing development and
other construction projects which utilize asbestos cement products, it is expected that the demand for
asbestos will be further accelerated. To meet the anticipated sales for 1967 steps have been taken to
oe the output at Cassiar and to bring the Clinton Mine into production during the final quarter
of 1967.

CASSIAR MINE
Mine

During the year, 901,650 tons of ore were mined of which 645,365 tons were treated in the rock
rejection plant to eliminate 183,420 tons of rock. The untreated balance of 256,285 tons was principally
selected high-grade ore which is not amenable to this form of concentration. The resulting 461,945

tons of concentrate and 256,285 tons of untreated ore were delivered to the mill, 489,308 tons by
tramline and 228,922 tons by truck.

Stripping operations continued at a high level and 4,299,373 tons of waste rock were mined at
a total cost of $2,508,192. Most of this waste lies above the orebody on the hanging wall side and is
removed in strips or phases to free the underlying ore for mining. The ratio of ore to waste varies from
phase to phase. It is the company’s accounting policy to capitalize the cost of waste removal and to
write it off in the appropriate proportion for that phase from which the ore is being mined.

The mine, plant and equipment were maintained in good operating condition. One of the older
mine shovels and one rock drill were replaced with larger and more modern equipment to provide
improved efficiency in the operation. The high rate of production and development, improved equipment
efficiency and a better supply of labour were all factors in controlling the effect of the rising cost of
labour and supplies. Unit mining costs for 1966 were comparable to those in the previous year.

Mill
The mill treated 706,492 tons of ore and concentrate at an average rate of 1,935 tons per calendar

day, and produced a record 87,900 tons of fibre. Minor changes to the rock rejection circuit and the
mill are currently being made to permit more flexibility and maintain the rate of production.

Ore Reserves

There has been no diamond drilling or develpment work done which would change the ore reserve
estimates last reported in 1963. To date, the orebody is mining out substantially as predicted and as
at December 31, 1966, the probable reserves within the presently planned pit limits and to a depth of
340 feet below the lower adit stood at approximately 27,000,000 tons.

Labour

Difficulty in securing labour with the necessary skills continued throughout the year. The turnover
in personnel, however, dropped considerably from an annual rate of 175% to 127% and overtime hours
were reduced from 21.6% to 15%.

The company has started a training programme encompassing apprenticeship training for the
trades and crafts, and learner training for the operating personnel. During the current year the results
of the programme will be assessed. Present indications are that it will be a major step forward in
overcoming the shortage of skilled personnel.

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