Montreal-based Cambior (TSE) will buy a 40% interest in a company that owns a project with a mineral inventory of 500 million tonnes averaging 0.75% copper, based on a cutoff grade of 0.5% copper.
Pachon S.A. Minera owns the Pachon copper project 185 km. west of San Juan, Argentina. The property consists of 18.5 sq. km of mining concessions which host a mineral inventory that remains open laterally and at depth. Cambior became interested in the project as a result of regulatory improvements affecting mining investments in Argentina. A contributing factor was the willingness of the Chilean and Argentine governments to co-operate in the development of projects along their shared border.
Cambior has agreed to pay US$10 million for 40% of the common shares of Pachon. It can acquire a further 10% of the common shares by spending US$5 million on exploration and development before March 31, 1997. Cambior will operate the project and fund a proportionate share of the project’s expenditures after the option period.
Cambior plans to drill three previously identified, but as yet unexplored, anomalies and investigate the feasibility of developing the resource. In other news, an agreement in principle was signed whereby Chase Manhattan Bank of Canada and Royal Bank of Canada will underwrite a US$225-million credit facility for Cambior.
About US$100 million will be used to refinance the existing gold loan, which was taken out on the Omai project in 1992.
Additional funds from the credit facility may also be used to finance the proposed expansion of the Omai mill and the development of the 1100 Lens, Grevet and Carlota projects.
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