The owners of Minorca Resources (ME) are hoping to reach a settlement with creditors which will allow the company to expand its development plans for the Donalda gold mine near Rouyn-Noranda, Que.
Minorca (or 9014-2167 Quebec Inc.) was created through the amalgamation of three companies: Minorca Resources, Orco Resources and 9007-3875 Quebec Inc. (a subsidiary of Denyvan Resources).
The Donalda mine, which was temporarily shut down early in March pending a successful arrangement with creditors, was being developed by Orco prior to the amalgamation. Orco signed an agreement with Donalda’s owners, Metall Mining and Thunderwood Resources, to develop the property.
Minorca has filed a proposal with the courts in accordance with the Quebec law on Arrangements with Creditors of Companies. Preferred creditors are being offered the total amount owed to them. Unsecured creditors are being offered three options: shares, cash, or a combination of shares and cash. Preferred creditors are owed about $332,000, and unsecured creditors about $1.6 million.
Minorca Vice-president Michel Roy says the company plans to spend some $15.5 million developing Donalda during the next five years and hopes to be producing more than 50,000 oz. by 1998. A rights offering is also planned.
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