Minnova combines with Orex on Goldboro exploration play

Having recently settled a legal dispute, Exploration Orex (ME) says it has entered into an option agreement with Minnova (TSE) covering exploration and development of the Goldboro gold project in Nova Scotia. Under the terms of the letter of intent, Minnova may acquire a 60% interest in the property by spending $5 million on exploration work during the next three years.

Minnova is also responsible for making the mortgage payments owed to Onitap Resources (TSE), the company from which Orex is purchasing the property over a multi-year period.

Provided Minnova maintains its option to earn the 60% interest, Minnova has agreed to purchase $1.250-million worth of Orex capital stock ($250,000 by mid-April, 1991, and $1 million by mid-April, 1993).

Orex President Michel Roy said the agreement could permit the parties to bring the Goldboro project to the production-decision stage. Orex estimates the Goldboro property contains preliminary reserves of 28.9 million tonnes grading 2.59 grams gold per tonne.

Orex says the deal means it will not require any additional financing before a production decision is taken.

Orex, based in Rouyn-Noranda, Que., initially optioned the Goldboro property from Onitap to earn a partial interest before negotiating an agreement to purchase a 100% interest.

This past summer, Orex sued Onitap. However, the two companies recently settled out of court. An amended purchase agreement calls for Orex to pay a total of $8.75 million to Onitap for full ownership of the property.