Norex seeking more partners

Noranda Exploration (Norex) plans to spend $75-80 million this year for grassroots exploration in North America says President John Harvey. Noranda Exploration conducts mineral exploration on behalf of Noranda (TSE), but Harvey’s estimate doesn’t include contributions from other Noranda affiliates Minnova (TSE), Kerr Addison (TSE) or 50% owned Falconbridge which bring the Noranda Group’s total projected exploration spending for 1991 to about $140 million. So far, about $72 million of Norex’s 1991 budget has already been raised from Noranda-controlled companies including Hemlo Gold (TSE), Noranda Minerals, Brunswick Mining & Smelting (TSE) and Brenda Mines (TSE). The remaining $8 million is expected to come from Norex’s other joint venture partners, Harvey said.

“Noranda is committed to maintaining its exploration funding, and we’d like to get some more joint venture partners in 1991,” he said. With more than 300 active projects already in its portfolio, Norex manages the largest base metals exploration program in North America.

As well, a total of $5 million has been earmarked for Australia and Latin America, mainly for gold and copper-gold projects.

The company has made some notable discoveries in recent years including its 100% owned Lynne zinc-silver deposit in Wisconsin. Other exploration successes for Norex include the company’s 51% owned Holloway gold project in northeastern Ontario and the 60% owned New World gold project in Montana.

However, Harvey expressed concerns about the declining level of exploration in Canada brought on by economic recession, lack of incentives and low metal prices.

“Exploration for base metals has been sadly neglected in Canada,” Harvey explained in an interview. He said that unless more companies start conducting exploration for base metals, the country’s overall reserves of copper, lead and zinc could sink to dangerously low levels.

“Most of our partners want gold projects, and nobody wants to fund grassroots exploration for base metals,” he explained.

Exploration is in the doldrums across Canada, and without more incentives to offset the high capital costs involved in building new mines, a further decline in base metal reserves is conceivable, predicted Harvey. He suggested that governments could offer tax-free periods during startup to new mines as one method of attracting the needed investment.

In central Newfoundland, Norex is actively searching for new base metal deposits in a joint venture with BP Canada (TSE). The company is also exploring a promising gold project with Vancouver junior Major General Resources (VSE) on the Springdale Peninsula.

Toronto-based Deak Resources (TSE) is working with Noranda in northern Quebec where the company is looking for new copper-lead-zinc deposits. Harvey said Norex is also encouraged by recent success on its Orchan base metal property in the Matagami camp of northwestern Quebec.

Across the border, in northeastern Ontario, four drills are being kept busy on Noranda’s Holloway gold project in a 60-40 joint venture with Freewest Resources (TSE).

Meanwhile, high in the Arctic of the Northwest Territories, a total of $1.5 million will be spent this year on Noranda’s Victoria Island copper project as part of a joint venture program with Nanisivik Mines and Highwood Resources (TSE).

Harvey said Norex wants more joint venture projects this year and is seeking new partners, especially in the base metals area. “We’re committed to base metals exploration,” he said. “We need to find more ore to feed Noranda’s smelters.”