Cancor exercises Gemini option, raises funds

Montreal-based Cancor Mines (KCR-T) has acquired from Inco (N-T) a half-interest in the Gemini polymetallic property in northwestern Quebec.

Cancor fulfilled the major terms of a 1997 option agreement by spending $1.4 million on exploration and issuing 300,000 shares to Inco.

Between 1991 and 1996, Inco spent $1.5 million at Gemini, carrying out prospecting, airborne and ground geophysical surveys, and reverse-circulation and diamond drilling. The work identified strong volcanogenic massive sulphide alteration and massive-pyrite intersections in a copper-zinc-gold-silver-bearing area named zone B and, 4 km to the north within the same horizon, in a gold-bearing area dubbed zone A.

Under the agreement, Cancor will remain project operator at Gemini until it makes a positive production decision, at which time Inco may participate by either reimbursing all expenditures incurred by Cancor or transferring the remaining half of the project to the junior for a 2% net smelter return royalty.

Cancor has also raised $1 million by privately placing 2 million shares (of which 1.6 million are flow-through). The junior plans to spend $800,000 on ongoing definition drilling at Gemini.