This has resulted in a four-month delay in the completion of construction and the cost has risen
from $4,300,000 to $6,800,000. While there have been a number of improvements in the flowsheet

and in environmental control, a substantial part of the increased cost can be attributed to labour
disruptions.

Your company has acquired a 10% interest at a cost of $25,000 in Turners Building Products
Ltd., a new firm engaged in the manufacturing of asbestos-cement products in the Vancouver area of
British Columbia.

SALES

Fibre sales in 1970 reached a new high of 196,387 tons valued at $41,321,623 compared with
171,493 tons valued at $37,188,930 in 1969.

The market for all grades of fibre was strong throughout the year and there are indications of a
further ten percent increase in the volume of the company’s sales in 1971.

The prices of the company’s fibres were increased on 1 J anuary 1971 by an average of six
percent. The previous price increase was on 1 January 1969.

CASSIAR MINE
Mine

During the year 917,633 tons of ore were mined, of which 900,090 tons were treated in the rock
rejection plant to eliminate 222,154 tons of rock. The untreated balance of 17,543 tons was high grade

ore which is not amenable to this form of concentration. The resulting 677,936 tons of concentrate

and 17,543 tons of untreated ore were delivered to the mill, 464,073 tons by tramline and 231,406 tons
by truck.

A total of 4,269,300 tons of waste was removed from the orebody at a cost of $3,516,559.
It is the company’s accounting policy to capitalize the cost of waste removal. The waste is related to
sections of ore released for mining by its removal and the cost is apportioned accordingly. As the ore
is mined from a “section”, the appropriate portion of waste removal is written off as a part of the ore
mining cost. On this basis, the waste charge against the ore currently being mined is $1.68 per ton.

Shear blasting in the hanging wall waste continues to prove successful and the slope of the pit
walls is gradually being steepened to approximately 45°.

Unit costs and productivity in both the mine and mill were satisfactory. Most of the ore was
mined from the lower grade footwall zone completing the removal of Phase 4.

Mill

The mill treated 689,388 tons of ore and concentrate and produced 85,871 tons of fibre. The
mill expansion originally scheduled for completion by the first of the year will not be completed until
early April, 1971. It is anticipated that the loss of the additional production programmed for the first
quarter of 1971 will be recovered during the balance of the year.

Ore Reserves

The probable ore reserves within the presently planned pit limits and to a depth of 340 feet
below the lower adit are estimated at 23,000,000 tons. A diamond drilling programme will be carried
out in 1971, at a cost of approximately $150,000, to test the ore zone to a depth of 700 feet below the
adit and to confirm the location and attitude of the hanging wall and footwall contacts. This information
is essential to the long range planning.

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