Claude Resources News Releases

Gold prices remained above US $300 per ounce throughout the third quarter of 2002. Fear of a faltering US economic recovery and potential world conflict prompted the investing public’s turn to gold as a historic safe haven in troubled times.

A significant run-up in gold share prices in the first six months of 2002 took a breather in the third quarter and share prices retreated from earlier highs. Claude Resources’ shares opened the year near $.60 and traded to a high of $2.45 before declining below $1.00 in September. The Company’s share price performance was exaggerated in both directions, related in large part to speculation surrounding the exploration results at Claude’s Madsen property in Red Lake, Ontario. The current nineteen-hole drill program at Madsen is targeted for completion by the end of November, with drilling results expected in the first quarter of 2003.

As forecast in the second quarter report, gold production at the Seabee mine continued to improve throughout the third quarter and returned to historic levels in September. Under the current mine plan, the Company is confident that Seabee will maintain annualized production levels of 50-55,000 ounces per year in the fourth quarter of 2002 and the year 2003.

Claude’s financial performance was much improved in the third quarter. Cash earnings of $1.2 million are a significant improvement over the break-even cash earnings in the second quarter 2002 and $.6 million in the third quarter of 2001.

Financial

Three months

For the quarter, the Company recorded a net loss of $.2 million ($0.00 per share) compared to a net loss of $.7 million ($0.02 per share) in the same period of 2001.

Total revenues increased from $6.5 million in 2001 to $7.0 million this quarter. Gold revenue increased 13% from $4.6 million in 2001 to $5.2 million. Gold production remained relatively unchanged at 10,600 ounces compared to 10,800 ounces last year. The increase in average realized gold price period over period, from US $276/CDN $427 in 2001 to US $316/CDN $493 in 2002, had the largest impact on gold revenue. Oil, liquids and gas revenues decreased 11% to $1.7 million compared to $1.9 million in 2001. This reduction was a combination of normal production decline rates offset by higher realized petroleum prices in the quarter.

Total mine operating costs increased slightly from $3.8 million in the third quarter of 2001 to $3.9 million in 2002. Cash operating cost of US $236 per ounce this quarter compares to US $225 per ounce last year. The cost per ounce for the quarter began to track historically reported values as production increased during the latter half of the third quarter.

Cash flow from operations before the net change in non-cash working capital items was $1.2 million ($0.02 per share) compared with $.6 million ($0.02 per share) for the same period last year. This increase, a result of improved gold production and related price increases, is especially significant when compared to the negative cash flow reported during the first half of 2002.

Year to date

The Company recorded a net loss of $3.2 million ($0.07 per share) for the first three quarters of 2002 compared to $1.9 million ($0.05 per share) in 2001. Total revenues were $17.6 million, a decrease of 21% from the $22.3 million in 2001. This was due largely to period to period declines in gold, oil, liquids and natural gas production but offset to a degree by an increase in average gold price realized.

Gold revenues fell from $14 million in the first nine months of 2001 to $12.8 million in 2002. At 26,600 ounces, year to date gold production is 21% less than the 33,600 recorded last year. Mill throughput from the low grade 2D zone between the 190 and 390 levels continued to impact gold margins. Increases in the average gold price realized period over period (2002 – US $306/CDN $481; 2001 – US $270/CDN $416) aided in reducing the impact of lower production.

Total mine operating costs remained relatively unchanged at $11.7 million for the first nine months of 2002. However, as a result of the lower gold production, cash operating costs per ounce increased from US $224 to US $280.

Gross oil, liquids and gas revenues decreased by 42% from $8.3 million in 2001 to $4.8 million year to date. For the nine months ended September 30, 2002, oil and liquids production was 53,600 barrels, 20% lower than the 67,000 barrels produced in the 2001 period. The average realized price was US $23.74 (CDN $37.29) per barrel versus US $25.93 (CDN $39.89) last year. Gas production declined 22% from 751 MMCF in 2001 to 587 MMCF this period. The average realized price was US $2.47 (CDN $3.88) per MCF compared to the US $4.10 (CDN $6.31) per MCF realized last period.

Oil and gas operating costs fell 14%, from $1.4 million during the first three quarters of 2001 to $1.2 million for the corresponding 2002 period.

General and administrative costs increased period over period from $1.1 million in 2001 to $1.6 million in 2002. The increase is largely attributable to the settlement of a prior year property tax assessment at Madsen.

Depreciation and depletion of the Company’s gold assets was $3.5 million compared to $4.1 million in the 2001 period. This variance is a combination of increased Seabee ore reserves and a decrease in tonnes broken and mill throughput. Depreciation and depletion costs per ounce for the 2002 period were US $84 versus US $80 for the same period last year.

Liquidity and Financial Resources

Cash flow from operations before the net change in non-cash working capital items for the period was $.5 million ($0.01 per share) compared to $2.6 million ($0.06 per share) for the same period in 2001.

Capital expenditures in the first nine months of 2002 amounted to $6.3 million, an increase of $3.0 million from the corresponding 2001 period. This reflects increased development expenditures at the Seabee mine (2002 - $4.1 million; 2001 - $2.2 million), and an aggressive exploration program, funded by a flow through share issue at the end of 2001 (2002 - $.9 million; 2001 - $.1 million). Investments of $1.2 million reflected a $.5 million increase in the cash funding of our financial assurance requirements at the Seabee mine.

Financing activities during the first nine months of 2002 was highlighted by the receipt of $5.0 million pursuant to a private placement completed earlier this year.

Derivative Instruments and Hedging Activities

To mitigate the effects of price fluctuations on revenues, the Company may undertake hedging transactions in respect of foreign exchange rates and the price of gold.

As at September 30, 2002, the Company had outstanding forward gold contracts related to 2002 production of 8,250 ounces at an average price of US $298 per ounce, with a market value loss inherent in these contracts of US $.1 million. As at September 30, 2002, the Company had outstanding foreign exchange contracts to sell US $5.3 million at an average exchange rate of 1.5873 CDN$/US$, with a market value gain inherent in these contracts of US $5,000.

Operations

Gold – Seabee Mine

Mill feed ore grade continued to improve in the third quarter, resulting in 11,100 ounces being processed at 7.6 grams per tonne on 45,700 tonnes. This is a marked improvement over first half production numbers in which 15,200 ounces were produced at 4.8 grams per tonne on 106,400 tonnes throughput.

As forecast in the second quarter report, ore grades had returned to historic levels by the end of September. The improvement in production is the result of continued successful development and mining of ore in the B & C zones between the 400 and 550 metre levels. During the third quarter, mill feed was primarily obtained from development headings and "swell" from stopes where the ore was being broken. Commencing in the fourth quarter, the mine will start "freepulling" ore from completed stopes.

At the end of the third quarter, internally compiled ore reserves were as follows:

THIRD QUARTER REPORT For The Nine Months Ended September 30, 2002

THIRD QUARTER REPORT
For The Nine Months Ended September 30, 2002