Metall selling Mobrun royalty to Cambior

Toronto-based Metall Mining (TSE) has agreed to sell its 4% net smelter return (NSR) royalty on production from the Mobrun polymetallic property of Audrey Resources (TSE) for $11 million to Cambior (TSE).

The property is near Rouyn-Noranda, Que. Cambior will also acquire the 1.25 million shares of Audrey owned by Metall, for $1.37 million ($1.10 per share).

The share purchase will increase Cambior’s stake in Audrey to 75% from 72.3%. (Audrey has 45.5 million shares outstanding.)

Cambior is developing the deep 1100 Lens deposit, with daily production of 2,000 tonnes expected to begin in the first quarter of 1995. Annual production for the first five years is estimated to be 22,000 tonnes of copper concentrate grading 20%, 47,000 tonnes of zinc concentrate grading 54%, 358,000 oz. silver and 23,800 oz. gold.

Early in 1994, Metall exercised an option to convert its 50% interest in the Mobrun property into a 4% NSR.