Asset sales among corporate activities

By putting its oil and gas assets on the selling block at the beginning of the year, Placer Dome (TSE) signalled that it intended to stick to its core business of mining. New acquisitions, such as the huge Mount Milligan copper-gold deposit in British Columbia, helped confirm that idea and kept Placer Dome in the news throughout the year. Going into 1990, Newmont Gold (NYSE) said that it had the largest reserve position of any North American gold producer with 20.5 million oz., compared with 16.3 million oz. a year ago.

By March, falling uranium prices had forced Rio Algom (TSE) to announce plans for closing two of its Elliot Lake, Ont., uranium mines. Also suffering from low uranium prices, Denison Mines (TSE) announced plans to cut production at its Elliot Lake mine in Ontario, as well as sell its oil and gas assets to raise cash.

In April, lead-zinc producer Curragh Resources (TSE) announced its first public offering of nine million subordinate voting shares. The underwriter took a bath on the issue which fell short of expectations due to lack of investor interest.

The month of May saw a new diversified company emerge following the amalgamation of Conwest Exploration (TSE) with Mineral Resources International and Barrons Oil.

Senior gold producer Echo Bay Mines (TSE) sent Muscocho Explorations (TSE) and Flanagan McAdam Resources (TSE) scrambling in May after it decided to cancel a planned refinancing deal with the juniors.

As spring turned to summer, Corona (TSE) and Placer Dome both grabbed headlines when they began a bidding war for control of the high-grade Eskay Creek gold discovery owned by Stikine Resources and Prime Resources Group (VSE). Later in the year, Corona decided to sell its stake in Poco Petroleums to pay for developing Eskay.

In July, Noranda (TSE) made headlines after it paid nearly $6 million for a “salted” gold prospect in Western Australia. Situated at Karpa Spring, the gold discovery was a dud, and the police were called in to investigate. One observer dubbed it the “scam of the century.”

In August, during the biggest drill program in eastern Canada, partners Noranda and Freewest Resources (TSE) pulled 64 ft. grading 0.43 oz. gold from their Lightning zone in Holloway Twp., near Matheson, Ont.

In the following month, Ontario’s New Democratic Party was swept into office after a surprise election upset of the Liberals. But, investors shrugged off the impact of the NDP victory, and shares of mining firms operating in Ontario, such as Inco (TSE), Rio Algom (TSE), Teck (TSE) and Hemlo Gold (TSE), remained generally unchanged.

As summer gave way to fall, rivals Metalore Resources (TSE) and Ontex Resources (ASE) went to trial in an Ontario court to fight over control of the Brookbank gold deposit near Beardmore, Ont. Before the year’s end, Ontex was awarded full ownership of the property by the court.

Meanwhile, joint venture partners Aur Resources (TSE) and Societe Miniere Louvem (TSE) reached an out-of-court settlement in their legal dispute over the Louvicourt base metal deposit near Val d’Or, Que. The deal resulted in Aur ending up with a 55% interest in the 36-million-ton deposit, while Louvem retained a 45% stake.

Placer Dome captured headlines in October when it bought the huge Mt. Milligan copper-gold deposit in British Columbia for nearly $260 million. Placer scooped up the 400-million-ton deposit when BP Canada (TSE) and Continental Gold sold their respective interests.

In November, Inco earmarked $287 million for new shaft development and capital investment at its Thompson, Man., nickel mines. The company also unveiled plans to take its Inco Gold subsidiary public by merging the unit with Consolidated TVX Mining (TSE), a firm well known for its South American connection.

As winter arrived, Falconbridge Gold (TSE) announced plans for a reorganization and a clearer mandate within the Falconbridge group.

The year 1990 also saw Phelps Dodge establish a stronger presence in Canada along with Kennecott Corp. which beefed up its profile in Canada. Meanwhile, Umex pulled out of this country altogether after selling its properties to Vancouver- based Major General Resources (VSE). Chevron also phased out its exploration for base and precious metals in Canada in 1990.

By late fall, Placer Dome got tough with striking miners at its money-losing Dome mine outside Timmins, Ont. The workforce was slashed in half following a bitter 6-month strike that ended in November.

As a major recession gripped the country by December, exploration staff layoffs were announced by Corona (TSE), Echo Bay Mines (TSE) and Inspirations Resources (TSE).

Elsewhere on the labor front, Cominco (TSE) reduced the workforce at its 80-year-old Sullivan lead-zinc mine in British Columbia, and resumed production in December following a temporary closure earlier in the year.

By year-end Royal Oak Resources (TSE) completed its $33-million purchase of the Pamour group’s aging gold mines in Ontario and the Northwest Territories.