On basis of copper find Value of Aur, Louvem soars

More than 3.3 million Aur and 2.2 million Louvem shares changed hands in the three days after results were released from seven widely spaced surface drill holes from a previously untested area of the 8,300-acre Louvicourt Twp. property.

At press time the Aur issue had risen to $6.38 from $2.95, while Louvem had shot up to $1.82 from 52 cents .

Drilling highlights include a 117- ft intersection of massive and stringer sulphides which assayed 4.96% copper and a 9-ft section of high grade zinc mineralization for which assays are not yet available.

“There is a lot more driling to be done, but I think this is a major new deposit and it could be a very large mine,” Aur President Jim Gill told The Northern Miner.

But an ownership dispute involving Aur and Louvem could prevent shareholders from knowing for some time how much the recent results at Louvicourt will eventually be worth to both partners.

As operator of a $1-million surface exploration program, Aur says its holds a 58% stake in the property which contains a former open pit copper/zinc mine.

Aur is also claiming the right to dilute Louvem’s 50% stake in the property down to a 25% non-participating interest because it says Louvem was in default of a $40,000 payment on an earlier exploration phase. Val d’Or-based Louvem is a 56%-owned affiliate of St. Genevieve Resources (TSE).

“Once they went into default, they relinquished the right to come back in,” said Aur Vice-president Howard Stockford who expects his company’s interest in Louvicourt Twp. to rise to 75% within four months.

The subject of an unsuccessful $8.3-million takeover bid by Aur, Louvem issued a press release after the results were tabled stating that it holds a 50% undivided interest at Louvicourt Twp. “In the opinion of Louvem’s management, the Aur claim is ill-founded, and if needed, will be judicially contested,” the company said.

Relations between Aur and Louvem have been cool since the latter company agreed to sell its 50% stake in the Chimo gold mine to Cambior Inc. (TSE) for $4 million. Situated about 25 miles east of Louvicourt Twp., the mine was sold around the same time that Aur was attempting to buy Louvem.

As a result of the dispute, Louvem General Manager Jean Patie said he was unaware of the latest results until he read them in a press release. “Should our legal people be wrong, we will revert to a 25% non-participating interest which is pretty good as far as we are concerned,” he said. If lawyers are correct, management of the project would be transferred to Louvem in the event that an exploration program is warranted.

Stockford referred to the core as “some of the best I’ve ever seen.” But Rouyn, Que., stockbroker Mario Bouchard said he knew of no new staking activity. In Toronto, base metal analysts were taking a cautious view of the Val d’Or results.

Although the discovery was made at a depth of between 1,500 and 2,000 ft below surface, the project seems to have potential, Prudential Bache Securities analyst Alan Ferry told The Northern Miner.

The 117-ft intersection which assayed 4.96% copper included 29 ft of grade 11.8% copper, 1.57 oz silver and 0.024 oz gold per ton. “The long east-west strike length (1,500 ft) should attract the attention of major base metal producers like Falconbridge Ltd. (TSE),” Ferry said.

The old Louvem mine was predicated on six zones, of which five were mined above 1,000 ft. It produced more than 2.1 million tons of ore from 1969 to 1979. Last fall, Aur pulled 386 ft of grade 0.83% copper in a hole below the Zone 6 massive sulphide lense.

“It looks like we have plugged into the source of that stringer zone,” said Stockford. He is encouraged by the fact that the latest results were encountered in an un- mined horizon 800 ft south and 2,000 ft east of former mine workings.

While he said it is still much too early to start talking about tonnage figures, a good deal more than the $1 million designated for Louvem will be spent this year.

A third drill rig was on site last week and there is still 10,000 ft of open ground between the most easterly drill hole and Aur’s eastern boundary which borders on ground controlled by Consolidated Abitibi Resources (ME), Stockford said.

So far, massive sulphides have been encountered over a strike length of 1,500 ft and in a 500-ft section at depths between 1,500 ft and 2,000 ft. The deposit is open in all directions and it has yet to be drill tested above 1,500 ft. “All we need to do now is prove up continuity and tonnage,” said Stockford.

In addition, Aur says the deposit is accompanied by an extensive zone of stringer copper mineralization which was intersected in holes 309-30, 35 and 40 along strike to the east.

In another hole 309-43, situated about 1,000 ft further west of hole 309-42, Aur intersected similar massive sulphide mineralization averaging 2.75% copper, 0.69% zinc, 0.57 oz silver and 0.04 oz gold across 78.5 ft.

A high grade interval from the same hole assayed 5.95% copper, 2.75% zinc, 1.12 oz silver and 0.025 gold over 14.5 ft.

In a hole located between holes 309-42 and 309-43, Aur intersected copper and zinc-rich massive sulphides over 130 ft. “Although assays from this hole not available yet, visual observations of the core indicated that this mineralization will be ore grade,” said Stockford.

Aur is planning to produce 24,000 oz gold this year from its Kierens zone gold deposit in Val d’Or, but the Louvem results are seen as important to a company which is attempting to diversify.

On March 31, Aur’s working capital position stood at $18.5 million with more than 16.3 million shares outstanding.

Other results released by Aur and Louvem Mines are as follows:

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