by Doug Ashbury
Northern News Services

NNSL (Nov 19/97) - Hit by the lowest gold prices in years, Giant Mine owner Royal Oak Mines Inc. is laying off 27 employees.

Rick Cassidy, president of the Canadian Auto Workers local, which represents the staff, called the layoffs the largest dismissal in several years.

Cassidy said Tuesday night that he was told 14 of Giant's 240 unionized staff and 13 administrative positions have been given two week's notice.

"We're very concerned. The price of gold obviously is really low and we hope it will turn around," he said.

Royal Oak is reducing staff as part of a plan to keep its mines profitable. Gold slipped to $299.25 US Friday and closed Tuesday at 307.70.

Royal Oak has just over 1,000 workers at its two operating mines in Yellowknife and Timmins. About one-third are employed in Yellowknife.

The company plans to only mine ores that can keep production costs below $300 per ounce.

In August, the company closed its Hope Brook mine. In September, Royal Oak shut its Colomac mine.

The company's Kemess mine in northern B.C. is due to be operational in April. Kemess is to produce 250,000 ounces at a cost of $79 US per ounce. It is about 70 per cent complete.

For all mines, Royal Oak estimates 1997 per ounce production costs at $332 US based on 340,000 ounces.

Giant 1997 production, part of the 340,000-ounce total, is estimated to be 92,000 ounces.

In 1998, Royal Oak estimates production of 340,000 ounces costing $200 US an ounce. Comparative 1999 figures are 480,000 ounces and $174.

Giant is predicted to produce 95,000 ounces in 1998 and 95,000 ounces in 1999, Royal Oak vice-president Graham Eacott said.