Rio acquires 25% royalty in Polaris lead-zinc mine

Metals producer Rio Algom (TSE) has bought all the shares in NCO Mines, which holds a royalty interest in production from the Polaris lead-zinc mine.

NCO, a wholly owned subsidiary of North Canadian Oils, has as its main asset a 25% royalty interest in the net proceeds of production from the base metal mine on Little Cornwallis Island in Canada’s Arctic.

In addition, NCO has a 25% participation interest in an exploration joint venture on a 79,000-acre property on neighboring Cornwallis Island. The purchase price of the royalty and interest in the joint venture was about $57 million, plus closing adjustments.

In 1993, the Polaris mine — operated and 77.5% owned by Cominco (TSE) and partner Pine Point Mines — produced more than 195,000 tonnes of zinc concentrates and 39,000 tonnes of lead concentrates from 1 million tonnes of ore averaging 12.3% zinc and 3.5% lead.

At the end of 1993, the mine had reserves of 8.6 million tonnes averaging 13.4% zinc and 3.7% lead, — enough for eight years of production. Rio’s metals production for 1993 was about 53,000 tonnes copper, 578 tonnes molybdenum, 829 tonnes uranium and 522 tonnes coal.