Repadre hopes for rewards

Shareholders at Repadre Capital’s (TSE) annual meeting learned that their company could reap big rewards from diamond discoveries by Aber Resources (TSE) in the Northwest Territories.

Repadre owns a 1% net smelter return (NSR) royalty on all diamond production on lands covering nearly 2 million acres in the Lac de Gras area. This royalty includes Aber’s Daviak property, the site of the discoveries. Last week, Aber announced that two diamonds — one weighing 1.75 carats and the other, 0.25 carats — had been found in drill core from the A-154 kimberlite pipe. Earlier this month, the company reported that 154 diamonds — 38 of which were macros — had been returned from the A-21 pipe. Diamond expert Christopher Jennings, a Repadre director, alerted shareholders to the “possibility of three world-class diamond mines (existing) in the Northwest Territories, one of which will be the Aber project.” In addition to the royalty, Repadre holds varying interests in several diamond exploration properties in Botswana. Two of these are adjacent to, and northwest of, the renowned Jwaneng diamond mine.

In his address to shareholders, President Gerald McCarvill said that although the diamond royalties are important, it has been gold royalties that have anchored the company since its reorganization last year. Repadre currently owns four gold royalties, three of which are generating cash flow: n a 1.8-3.6% NSR on production at Campbell Resources’ (TSE) Joe Mann mine, near Chibougamau, Que. — the value of which is based on the price of gold (at the end of 1993, proven and probable reserves stood at 1.1 million tons averaging 0.268 oz. per ton);

n a 2% NSR on production from Wheaton River Minerals’ (TSE) Golden Bear mine in northwestern British Columbia, where the mine life is estimated at 5-6 years; and

n a 5% NSR, and a 6% net profits interest (NPI) on production from El Limon-La India, a gold property in Nicaragua. (Payback from this royalty began in early June.)

The fourth royalty is a 3% NSR on future production from Great Lakes Minerals’ (TSE) Lluvia del Oro project in Mexico’s Sonora state. Repadre also holds a 3% NSR on production from American Gem’s (TSE) sapphire properties in Montana. American Gem recently obtained an operating permit for its Dry Cottonwood Creek property and mining is expected to begin in August. There are currently 13.8 million Repadre shares outstanding and the issue was, at presstime, trading in the $3.80-3.85 range.