NEWS ROUNDUP (December 23, 1991)

Drilling is under way on the 67-unit Hurdman property, about 65 miles north of Timmins, Ont., says owner Noront Resources (VSE).

The base metal prospect hosts several mineralized conductors and a half dozen untested conductors. Previously reported intersections include 10.5% zinc over 4.2 ft. and 1.5% zinc and 0.019 oz. per ton gold over 29.5 ft. Noront is also using OMIP (Ontario Mineral Incentive Program) grants to drill its West Clavos gold property northeast of Timmins and the Bremmer River property near Hemlo, Ont.

Toronto-based Denison Mines (TSE) says agreements with corporate lenders prevent it from making quarterly payments on the $175 million owed to holders of its 9.5% redeemable preferred B shares.

As a result, the debt-ridden uranium miner says it can’t redeem any of the series B shares deposited for redemption Dec. 15 and a decision will be taken on any future payments on a quarterly basis by the Denison board. Upon redeeming each of the shares, Denison is required to pay $25 plus all accrued and unpaid dividends.

Toronto-based Timmins Nickel (TSE) has acquired from BHP-Utah Mines the 49% interest in the Redstone nickel mine it doesn’t already own for $2.1 million.

In return for the asset, Timmins Nickel is paying BHP $540,000 in cash and the balance (to a maximum of $1.6 million) via a percentage of returns from mine output once the price of nickel rises above US$3.60 per lb. Nickel was trading recently at US$3.23 per lb. on the spot market.

Under the deal, BHP-Utah retains a 2% net smelter return royalty on ore produced from any new mines on the Redstone property, but not from the existing Redstone mine itself.

Echo Bay Mines (TSE) has agreed to end all legal proceedings launched against Nuinsco Resources (TSE) in connection with work performed at the Cameron Lake gold project in northwestern Ontario.

When Echo Bay initiated the lawsuit in 1989, it claimed it was owed $700,000 for work undertaken on the property by subsidiary Zanford Mining Services. In a countersuit, Nuinsco demanded a complete accounting for more than $7 million spent under certain construction and management agreements. But the two companies have now agreed to discontinue all actions without any admission of liability. Therefore, no money will change hands and each party will pay its own legal costs, said Nuinsco Chairman Malcolm Slack.

An 8,000-ft. drilling program is scheduled to begin on Kingswood Explorations’ (ASE) Devon mine property in Beatty Twp., east of Matheson, Ont., on Jan. 10, 1992.

Kingswood will follow up previous results from the property including a 6-ft. intersection grading 2.95 oz. gold per ton and a 10-ft. intersection grading 0.31 oz. gold.

The property lies just north of Glimmer Resources and Hemlo Gold Mines’ joint venture, where drilling has outlined reserves of just over one million tons grading 0.34 oz. gold.

In January, Kingswood expects to have over 90% of the shares of Fort Rupert Resources tendered. Fort Rupert owns a 50% interest in the Lac Marcaut property, 120 miles north of Matagami, Que., where Teck (TSE) is earning a 70% interest by spending $2.5 million on exploration and making cash payments totalling $300,000.

Teck recently completed linecutting and geophysics at Lac Marcaut in preparation for drilling in the spring of 1992.