Aur Resources’ (TSE) shareholders recently gave the green light to a financing deal with Teck (TSE) that allows Aur to fund its share of the development costs at the $326 million Louvicourt Twp. base metal project.
At the company’s annual meeting in Toronto, shareholders voted overwhelmingly to allow Teck to earn a 25% interest in the Quebec property now owned 55% by Aur and 45% by Noranda (TSE) affiliate Societe Miniere Louvem (TSE).
To earn the interest, Teck must contribute $55 million towards the first $100 million spent to develop a 5,000 ton-per-day copper-zinc mine, while acting as guarantor for any loans required by Aur to finance project construction. Cominco (TSE) and Teck together own 21% of Aur. But Cominco is not participating directly in the mine construction process.
“Net debt on the project (to Aur) will be about $68 million,” said Aur President James Gill, who expects Louvicourt to be a low-cost copper-zinc producer with a break even price of 51 US cents for copper.
Sinking of the first of two shafts is set to begin next month and Gill said he expects to see the first production by the fall of 1995, with commercial production scheduled for the end of the following year.
While the Louvicourt project is clearly the major priority for Aur, it spent $6.1 million on exploration at 29 of 55 properties in 1991.
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