Canuc Resources expects to start receiving royalty income from its uranium properties near Elliot Lake, Ont., by 1989. Sold to Denison Mines, the Canuc ground hosts drill-indicated reserves of 7-10 million tons of ore grading 1.86 lb uranium oxide per ton.
Denison has paid Canuc an initial payment of $150,000 and must pay $25,000 per quarter as an advance royalty until production begins. Canuc notes that Dension’s mining schedule for the company’s claims is still at a preliminary stage. Based on this plan, the partners expect development to begin in early 1988 and mining in 1989. By 1992, Canuc estimates annual uranium production of up to 1.5 million lbs. Canuc is entitled to receive a royalty of $1.025 per lb of uranium oxide in broken ore.
Future mining will take place from extensions of existing underground workings on Denison’s property which is adjacent to the Canuc claims. With future cash flow from royalty income expected, Canuc says the deal could enable the company to develop its Coronation Gulf gold property in the N.W.T. Located 380 miles northeast of Yellowknife, the property hosts reserves of 855,000 tons grading 0.22 oz gold per ton in two zones.
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