A letter of intent between Ontex Resources (ASE) and Placer Dome (TSE) to finance further exploration on the Brookbank gold property near Beardmore, Ont., has been extended indefinitely.
Ontex Vice-President Ross McGroarty said the decision to extend the letter of intent was made by “mutual agreement” between the companies but would not elaborate further.
Meanwhile, a court date has yet to be set for Metalore Resources’ (TSE) appeal of last year’s decision to award control of 471 mining claims, including the 18-claim Brookbank property, to Ontex after a 2-year legal battle.
The appeal, filed at the beginning of the year, says — among other things — that the trial judge erred in returning the property to Ontex without granting Metalore reasonable compensation for its exploration efforts. The Brookbank deposit hosts reserves of 1.4 million tons grading 0.26 oz. gold (uncut) per ton. Under the terms of its letter of intent with Ontex (T.N.M., Sept. 30/91), Placer Dome has the right to earn a 50% interest in 489 claims by purchasing $2-million worth of Ontex shares at 30% above market price within 18 months of an option agreement. Placer must also spend $1 million on exploration and development within six months.
If Metalore loses its appeal, Placer would be required to spend $4 million developing certain claims within three years, and an additional $2 million to develop 39 other claims.
The original deadline for the option agreement was Nov. 24.
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