Nuinsco deals base metal properties to Seadrift

In a bid to become a Canadian gold producer within 12 months, Nuinsco Resources has dealt some of its base metal properties to Seadrift International in exchange for a larger slice of the Cameron Lake gold property.

Under the terms of a recent agreement, Nuinsco will deal to Seadrift:

* Nuinsco’s 46.67% working interest in the Hebecourt Syndicate and the 0.42% net smelter return royalty in the syndicate’s property south of Lac Duparquet in Rouyn-Noranda, Que.

* A 51% interest in the Aldermac property, in Beauchastel Twp., Que., where the remaining 49% interest is held by Seadrift.

* Nuinsco’s 21% interest in the Lake Dufault property, near Rouyn. The remaining interest is currently held by Seadrift.

* A 100% interest in the Prairie Lake property near Marathon, Ont.

* The company’s 20% net profit interest in the Macanda property, at Beauchastel Twp., Que. where the remaining interest is now held by Seadrift.

In return, Nuinsco will receive $250,000, Seadrift’s 17.34% interest in the Cameron Lake property southeast of Kenora, Ont., plus Seadrift’s 100% interest in a block of 84 claims adjacent to Nuinsco’s Monte Cristo property in the Rowan Lake area of Ontario.

According to Nuinsco President Douglas Hume, the transaction was prompted by Echo Bay Mines which holds a 51% controlling interest in Nuinsco following a $4.125-million cash payment in September.

As reported (N.M., Sept 28/87), Nuinsco and partner Echo Bay are attempting to bring their Cameron Lake gold project to a feasibility stage by completing the second stage of an underground exploration program.

Reserves in the Cameron Lake Main zone stand at 1.6 million tons with a weighted average grade of 0.16 oz gold per ton to a depth of 1,100 ft.

“Echo Bay is keen that we concentrate on developing our gold properties and it seems hard to justify issuing flow-through shares to fund exploration at Noranda when we could be concentrating on the Cameron Lake property,” said Hume. He expects the transaction to close Dec 31.

With Echo Bay spending $6,750,000, some 500 ft has been completed on a 750-ft ramp, according to Hume.

In other news, Nuinsco will earn a 51% interest in Canadian Arrow Mines’ Dogpaw Lake gold property by spending $750,000 on exploration and development before Dec 31, 1989.

Located near Kenora, Ont., the property consists of 13 patented claims where previous exploration, according to Nuinsco, has indicated probable ore reserves of approximately 96,650 tons averaging 0.43 oz. gold per ton.

Under the agreement, Nuinsco must spend an initial $250,000 during the next 12 months. Nuinsco can then elect to spend an additional $500,000 in the second year to earn its interest.

Once Nuinsco has completed its share of the agreement, the two companies will form a joint venture (Nuinsco 51%, Canadian Arrow 49%) with Nuinsco acting as operator, to develop the property.