Corona sole owner of boric acid project

Corona, which had an 80% interest, said it has purchased the 20% interest in the project held by Mountain States Mineral Enterprises. Mountain States will receive $5 million in cash and 20% of the share capital of a newly incorporated affiliate of Corona, Fort Cady Minerals. (Corona will retain the other 80%.)

Corona proposes to extract boric acid from the Fort Cady property by solution mining; a feasibility study was completed last June. Boric acid has application in the manufacture of a number of items, including ceramics and cements, and as an antiseptic. The company is negotiating for $85 million of production financing with a number of commercial banks.

Plant construction is expected to be under way this year, with production to commence in 1990. The company says design production of 90,000 tons boric acid per year will be reached in 1992, once a plant inventory and market pipeline have been established.

Project reserves are estimated to be 147.4 million tons grading 6.4% boric acid with the average thickness of the deposit being 118 ft and the average depth of the deposit being 1,350 ft. The property is located about 100 miles northeast of Los Angeles.

Corona’s agreement with Mountain States contemplates the establishment of a publicly traded industrial minerals subsidiary to which the Fort Cady property will ultimately be transferred. Corona and Mountain States would then exchange the Fort Cady shares for shares of the new company, on an initial 80/20 basis.

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