Louvem plans rights offering to pay its share of Louvicourt

To help finance its $147.8-million share of the development costs for the Louvicourt base metal deposit near Val d’Or, Que., Societe Miniere Louvem (TSE) will issue a $45-million rights offering to all the common shareholders of Novicourt Inc. A new company, Novicourt is being formed to manage Louvem’s 45% interest in the $349.3-million Louvicourt project, which is being developed for startup in 1995 by Aur Resources (TSE) and Teck (TSE).

The rights issue, expected to total 15 million common Novicourt shares, will be offered in December once the arrangement creating Novicourt has been implemented.

Noranda (TSE), which owns 56.6% of Louvem, will provide the financing guarantees for the offering, subject to Louvem paying financing fees to Noranda.

The Louvicourt deposit, owned 45% by Louvem, 30% by Aur and 25% by Teck, has a strike length of 550 metres, dips 68-85 and is comprised of eight stacked lenses. Diluted minable reserves total about 24 million tonnes grading 3.89% copper, 1.95% zinc, 1.2 grams gold per tonne and 31 grams silver. The reserves extend from a depth below surface of 300 metres to 850 metres, below which the deposit is known to extend but remains unexplored. A 750-metre exploration shaft, started in June, reached a depth of 415 metres by the end of September. A 965-metre production shaft was also started in late September. The mine is expected to employ more than 400 people when it reaches full production at a rate of 4,000 tonnes per day in late 1996. Expenditures on the project to the end of September totalled about $44.9 million.