Scintilore claims ground where Bell mine stands

Alleging the mining claims covering the David Bell mine at the Hemlo gold camp in northern Ontario were forfeited under the Mining Act of Ontario, Scintilore Explorations (TSE) said it has now staked the claims on its own.

The company has also launched a lawsuit in the Supreme Court of Ontario disputing ownership of the property.

The producing David Bell mine is a joint operation of Teck Corp. (TSE) and Corona Corp. (TSE).

Scintilore said it has also restaked an adjacent quarter claim which is part of the Golden Giant mine property being worked by Hemlo Gold Mines (TSE); ownership of the quarter claim is also being disputed. Teck and Corona each have a 25% interest in the quarter claim. Hemlo Gold is controlled by Noranda Inc. (TSE).

Scintilore wants the claim certificates and mining leases issued for the properties cancelled by the court.

Corona said it believes there is no substance to the Scintilore allegations. The large gold producer said the property on which the David Bell mine and quarter claim are located have moved up the ladder of ownership from claim to mining-lease status. The current lease was granted by the province, the company said, and is in good and proper order. Production financing

Original production financing of about $135 million was obtained through an international consortium of banks, all of which, Corona said, made independent inquiries and were satisfied with Corona’s and Teck’s legal title to the property.

“Highly inappropriate” is how Corona President Peter Steen termed the Scintilore claim staking. “In a previous court hearing, Scintilore expressly add dmitted it was not challenging Corona’s Hemlo claims,” he said. “The court subsequently struck these portions of Scintilore’s claim, leaving only the challenge that royalties paid to prospectors Donald McKinnon and John Larche from the Hemlo gold mines should be paid to Scintilore.”

Scintilore is suing the two prospectors and four companies (Teck, Corona, Hemlo Gold and H.G.M. Inc., a wholly-owned subsidiary of Hemlo Gold), claiming all benefits and proceeds accruing to McKinnon and Larche from the major claims staked at Hemlo.

A Supreme Court of Ontario judge recently ruled that Larche and McKinnon may begin receiving royalties (totalling about $4.7 million) owing to them from the staking of the Hemlo claims. The men have not been paid since Scintilore launched its legal action against them (and the four companies) in April, 1987.

The same judge also gave the two prospectors 30 days to file a statement of defence in response to Scintilore’s lawsuit. (Larche and McKinnon have been challenging Scintilore’s statement of claim.)

Also, criminal charges of theft and forgery laid against McKinnon were recently withdrawn because of lack of evidence. The charges, heard in provincial court in Thunder Bay, were in connection with missing documents filed with the mining recorder’s office in Thunder Bay. The documents pertain to the Scintilore lawsuit.