cludes representatives of the Provincial Government Ministries of Mines, Labour,
and Health, as well as senior representatives of the Union and Company manage-
ment. These two Committees have brought about improvements in matters related
to environment and health.

To assist both Management and Unions to identify and resolve local environ-
mental and health matters, your Company has retained the consulting services of
Dr. Stefan Grzybowski, M.D., F.R.C.D., a recognized specialist in respiratory disease.

CLINTON CREEK MINE

Ore Mined During the year 1,866,619 tons of ore were mined and delivered to
the concentrator where 489,054 tons, or 26%, was discarded to tailings, leaving
1,377,565 tons of concentrate available for refinery processing. Recoverable mine
grade for 1976 was 6.08% compared with 5.85% in 1975.

Fibre Refined From 1,390,525 tons of concentrate, 113,559 tons of fibre was
produced.

Waste Removal A total of 580,279 cubic yards of waste was removed from
the ore bodies during the year at a cost of $897,078 or $1.55 per cubic yard. Waste
amortization charges were $1.90 per ton of ore mined.

Ore Reserves Mineable ore reserves as at December 31, 1976, were:

RONCUDINGIOTEDOUVs ss arecccays east ee 2,069,000 tons
Snowshoe Orebody.............. 1,367,000 tons
Creek. Oreo Vie sax sey scstasip-cs ees 412,000 tons

3,848,000 tons

It is expected that ore reserves will be exhausted during 1978.

Environment Despite the impending closure of the Clinton Creek mine your
Company is determined to maintain the highest possible standard of environmental
control in the plant and community areas. To this end, a local Environmental
Committee has been in effective operation since its inception in 1975. Indeed, its
function and composition formed the pattern for the subsequent development of
the Environmental Committee at Cassiar.

During the early part of the year a central vacuum system was installed in the
mill. This new facility has assisted in maintaining the average fibre counts within the
currently required standards.

TRANSPORT DIVISION

This division, based in Whitehorse, transported 94,076 tons of fibre, mostly
from the Clinton Creek mine to Whitehorse. During 1976, the cost of moving fibre
was lower than that achieved in 1975.

TERRITORIAL SUPPLY COMPANY LIMITED

In spite of a concerted effort to improve the sales and profitability of this
business, the results were disappointing. As a consequence, it was decided to
close this subsidiary company during 1976 and liquidate its assets.

EXPLORATION

A number of asbestos deposits were examined in the United States and
Canada, none of which, in management's opinion, warranted further work. It is
proposed to spend approximately $200,000 on a drilling program to further assess
the Kutcho Creek property in northern British Columbia during 1977.