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NERCO ADDRESSES WESTERN GOLD CONFERENCE

 NERCO ADDRESSES WESTERN GOLD CONFERENCE
 PORTLAND, Ore., Dec. 2 /PRNewswire/ -- Nerco Inc. (NYSE, TSE: NER)


today made a presentation to the Western Gold Show in San Francisco focusing primarily on the company's expected 1991 minerals results.
 Nerco Minerals Company President Charles C. Adams indicated the company's 1991 estimated gold production should exceed the 1990 record of 181,000 ounces while silver production is estimated to be 3.4 million ounces compared to 6.3 million ounces last year. The drop in silver production is primarily due to suspension of mining ace?s during November 1990, at Nerco Minerals company's Candelaria Mine in Nevada because of depressed prices. The mine produced 4.8 million ounces of silver and 12,000 ounces of gold in 1990.
 "Despite losing the production from Candelaria, the company is expected to increase gold production due primarily to improvements at the Con Mine, located in Northwest Territories, Canada," noted Adams. A mill upgrade in late 1990 increased throughput from 800 tons per day to 1,200 tons. In October 1991, the mill set an all time monthly record by processing 35,000 tons of ore.
 Nerco Minerals Company Chief Operating Officer Thomas Albanese presented an overview of the company's primary growth prospects including the Con Mine, DeLamar Mine (Idaho), American Mine (California), and the Cripple Creek Mining District in central Colorado. At the DeLamar Mine, the company has applied for permits to construct the Stone Cabin Gold Project located about five miles from the mine's current processing facilities. Albanese said the company had previously expected to receive all necessary permits to begin construction in 1992. "However, we now believe construction could be deferred until the mid-1990s because of the decision to allocate capital to our activities in the Cripple Creek District," Albanese said.
 Earlier this year, Nerco announced it had delineated a resource of 1.5 million ounces of contained gold reserves and deposits in the Cripple Creek District. Of this amount, the Cresson orebody, the largest identified target in the District, has approximately one million ounces of contained gold. The current dimensions of the deposit are approximately 5,000 feet by 2,000 feet and mineralization is open in all directions, including at depth. Metallurgical work indicates that the Cresson ores are amenable to heap leaching technology with an estimated recovery rate of 65 percent.
 Nerco began mining in the Cripple Creek District in August 1991, and initiated crushing and leaching activities in November. The company is currently mining at a rate of 10,000 tons of ore per day. Gold production is expected to be 20,000 ounces in 1991 and 60,000 ounces in 1992.
 The plan for the Cresson ore body is to complete the necessary permitting and construction activities to allow commencement of mining in 1992 at a rate of 15,000 tons of ore per day. Given the estimated recovery rate and strip ratio of about 2.2:1, cash production costs are anticipated to be approximately $200 per ounce.
 "With our current resource position in the Cripple Creek District, we estimate that annual production could reach 150,000 ounces of gold by the mid-1990s. We also estimate that capital requirements of approximately $40 million will be needed to reach this level of production, in addition to receiving government approvals," added Albanese.
 Nerco has completed about 440,000 feet of drilling in the Cripple Creek District over the past two years. The company recently accelerated deep rotary and core drilling to evaluate the underground potential of the Cresson deposit.
 Nerco Minerals company's affiliate, Pikes Peak Mining company, currently has an 80 percent interest in the Cripple Creek & Victor Gold company, a joint venture with Golden Cycle Gold Corporation. After a payback period, Pikes Peak Mining's interests would revert to 67 percent. In 1990, the joint venture produced 13,000 ounces of gold from previously mined material.
 Nerco Minerals company is a wholly owned subsidiary of Nerco Inc., a diversified natural resources company with interests in low- sulfur coal, oil, natural gas, and precious metals. For the first nine months of 1991, Nerco Minerals company produced 127,000 ounces of gold and 2.5 million ounces of silver.
 -0- 12/2/91
 /CONTACT: John C. Cummings, 503-731-6649, or Richard T. O'Brien, 503-731-6732, both of Nerco Inc./
 (NER) CO: Nerco Inc.; Pikes Peak Mining ST: Oregon IN: MNG SU:


JH -- SE009 -- 1993 12/02/91 16:26 EST
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Date:Dec 2, 1991
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