FORM 6-K
SECURITIES EXCHANGE
COMMISSION
Washington, D.C.
20549
REPORT OF FOREIGN
ISSUER Pursuant to Rule
13a-16 or 15d-16 of the
Securities Exchange Act
of 1934
COMMISSION FILE
NUMBER 0-15577 FOR
THE MONTH OF APRIL
1997
CONSOLIDATED NEVADA GOLDFIELDS
CORPORATION (Translation of
registrant's name into English)
1801 Broadway, Suite
1620
Denver, Colorado 80202
(Address of Principal Executive Office)
Indicate by check mark whether the registrant
files or will file annual reports under cover Form 20-
F or Form 40-F.
Form 20-F X Form 40-F
Indicate by check mark whether the registrant
by furnishing the information contained in this Form
is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.
Yes No X
If "Yes" is marked, indicate below the file
number assigned to the registrant in connection with
Rule 12g3-2(b): 82- .
Enclosed is: 1) Press Release 97-010 -
Consolidated Announces Completion of Shareholder
Credit Arrangement
Pursuant to the Requirements of the Securities
Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CONSOLIDATED NEVADA GOLDFIELDS
CORPORATION (Registrant)
Date: April 1, 1997 James R. Maronick,
Vice President
Finance
DENVER, COLORADO - MARCH 27, 1997 #97-010
5:00 PM MST
CONSOLIDATED NEVADA GOLDFIELDS CORPORATION ANNOUNCES
COMPLETION OF SHAREHOLDER CREDIT ARRANGEMENT
Consolidated Nevada Goldfields Corporation today
announced the completion of a $4 million line of credit
with two of its major shareholder groups; Grupo Acerero
Del Norte S.A. de C.V. of Mexico City, Mexico and Caithness
Resources of New York City, New York. Under the terms of
the agreement, the two shareholder groups will provide
$3,415,000 and $585,000, respectively, on one year
promissory notes.
The line of credit is part of the Company's
continuing debt restructuring and consolidation
program. The funds from the notes will be used by
the Company for general corporate
purposes and to sustain and accelerate
the pace of capital investment in the
Company's Mexican operations. The Company
is in ongoing discussions with several
major commercial banks to optimize and
restructure a number of bank debt
instruments held in Mexico and one in
the United States which total
approximately $27.5 million. Consistent
with the Company's objectives
expressed when it acquired its Mexican
properties in 1996, the Company proposes
to improve the terms of these debt
instruments through
consolidation while obtaining a uniform
term and lower effective interest
rate. The Company is current on all of
its financial obligations.
Results from operations for the Company
continue to
be mixed.
The Nixon Fork mine in Alaska, suffering
from equipment availability and
staffing problems performed worse than
budget in terms of output and costs
during the last calendar quarter of
1996. Despite these factors, development
exploration at the mine site has
replaced reserves faster than their rate
of depletion. During the first two
months of calendar 1997, the mine has
performed at budget production levels.
The Company's Aurora mine has continued to
perform according to budget during 1996
and year-to-date in 1997.
In Mexico, results from the Company's
four newly acquired mines have also
been mixed. Since completion of the
acquisition in October of 1996,
the Company has been engaged in a
systematic program of management
strengthening, capital investment,
operational rehabilitation and debt
restructuring. The pace of these
improvements has been slower than
anticipated with a consequent impact on
operating margins.
Slower than expected improvements during
the last calendar quarter of 1996 resulted
in below budget operations at the
Company's Pachuca silver mine near Mexico
City. During the first two months of
calendar 1997, however, operations at
Pachuca have met expectations with the
mill periodically running at a higher than
anticipated 1,300 metric tonnes per day.
Operations at the Baztan copper mine have
been complicated by reduced concentrate
offtake by the smelter at San Luis
Potosi. Management is exploring
alternatives to increase concentrate
sales.
The Company's Barita de Sonora barite mine
near Hermosillo, experiencing low
equipment availability and high overheads
has been performing below budget. New
maintenance programs, administrative
staff restructuring and improved operating
procedures are anticipated to increase
output from Barita de Sonora; the
operation has sales contracts in place
with PEMEX and Baroid International.
The Company's Magistral del Oro gold
tailings reprocessing operation in north
central Mexico is in the second phase
of a two phase metallurgical testing
program that will determine the long term
viability of this operation. The
operation has experienced difficulties
with excessive copper absorption and
slower than anticipated gold leaching
kinetics resulting in below budget
performance. Lower heap heights, higher
leaching rates and different chemical
concentrations are being tested as a
potential remedy for the problem. Results
from the test are expected to be available
by June.
The Company has previously announced
that it has changed its fiscal year-
end from June 30th to December 31st.
The Company anticipates audited
financial statements for the six
months ended December 31, 1996 will be
complete on or about the third week of
April. The Company anticipates that for
the operational reasons sighted above, it
will show a greater than expected loss
for the six month period.
Capital investment continues at the
Pachuca mine with the addition of rubber
tired equipment in some areas of the
mine and further development of new
shrinkage stopes and underground haulage
ways. As a consequence, the Pachuca
mine is projected to continue to
increase in production capacity through
the balance of the year and beyond.
The Company anticipates that it may
need to raise additional capital,
beyond that arranged through the recent
shareholder line of credit, in order to
increase the pace of capital investment at
the Pachuca mine. The
current debt restructuring program
will be instrumental in making this
possible.
Consolidated Nevada Goldfields
Corporation is a Denver based multi-
national mining company with six
producing mines and over 1,500
employees. The Company counts among its
resources 560,000 ounces of gold, 51
million ounces of silver, 38 million
pounds of copper and 4 million tons of
barite. The Company currently trades
on the Toronto exchange under the
symbol KNV, on NASDAQ under the symbol
KNVCF and on the Stuttgart, Frankfurt
and Berlin exchanges, under the symbol
CNV.
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