The Court of Appeal for Saskatchewan has upheld an earlier ruling that a voting agreement between Shore Gold (SGF-T, SHGDF-O), Cameco (CCO-T, CCJ-N), and UEM does not violate ownership rules at the Fort la Corne (FalC) diamond project in Saskatchewan.
The Court had previously dismissed an action brought by De Beers Canada against its joint-venture partners. De Beers had asked the court to void the voting agreement that gave Shore voting support from Cameco and UEM with regard to operating decisions at the joint venture for up to seven years. That support carried a $10-million price tag.
The diamond monolith was also looking for the court to issue a restraining order preventing the joint venture’s management committee — now effectively controlled by Shore — from approving the 2006 exploration program and budget.
That meeting eventually resulted in the approval of a whopping $43.2-million exploration budget for the 225-sq.-km project, about 60 km east of Prince Albert, Sask., in 2006.
The court also awarded costs to the defendants.
“This decision confirms Shore’s previous belief that the voting agreement is a valid and binding agreement and we now look forward to putting this matter behind us and moving the FalC project forward,” said Shore CEO Ken MacNeill in a prepared statement.
“This was an unfortunate incident but we remain committed to working with our new joint venture partners to maximize the potential of the FalC project and the Fort la Corne region as a whole.”
Shore inherited its 42.245% stake in the FalC project via its merger with Kensington Resources in October 2005. Cameco holds a 5.51% stake in the project, with UEM at 10%; De Beers Canada owns the remaining 42.245%. UEM is jointly owned by Cameco and Cogema, a subsidiary of French energy giant Areva (ARVCF-O).
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