More News.....From recent weeks.
Island-Arc Resources Corporation -
Back Lake diamond project interest increased
Island-Arc Resources Corporation
IAR
Shares issued 8533285
1997-12-10 close $0.25
Wednesday Dec 10 1997
Also Gulfside Industries Ltd (GFS)
Mr Kim Phillips reports
Island-Arc will issue Gulfside Industries 100,000 shares at $75,000 for a
2.69% interest. Previously, from Ella Resources the company will issue 85,000
shares at $62,500 for a 1.78% interest. From International Ballater Resources
the company will issue 85,000 shares at $62,500 for a 1.78% interest. And
from Victory Resources the company will issue 42,000 shares at $30,0000 for
an interest of 0.87%.
As a result of these acquisitions, the major owners of the Back Lake claims are
Island-Arc Resources with 8.90% carried, Kalahari Resources with 19.38%
carried and SouthernEra with 70% operator, responsible for 100% of
exploration expenditures until a production decision is made.
The company has made a similar offer to the remaining minority interest holder
(1.72%), which is under consideration.
The purchase from Gulfside is subject to a net proceeds royalty entitling
Gulfside to 20% of the proceeds which would have accrued to Gulfside had it
not sold its interest, payable only after recovery of all of Island-Arc's
development costs plus interest.
Under the terms of the Kennecott/SouthernEra joint venture agreement, the
operator (SouthernEra at this time) must notify the carried partners when a
production decision has been made. The partners then have 120 days to notify
the operator whether they wish to participate in the mine development by
paying their respective proportionate share of mine development costs, or, in
the alternative, accept their proportionate share of a 3% gross overriding
royalty (GORR).
Significantly, if a partner elects not to participate, the other partners may
increase their interests by participating in its stead, paying the non-participant
the GORR it would otherwise be entitled to.
If a diamond discovery is made on the Back Lake claims, and if Kennecott
decides to exercise its back-in right, major ownership would then be:
SouthernEra 35% Kennecott 35% Island-Arc 8.90% Kalahari 19.38%
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