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EXPLORATION 26 E&MJ; • FEBRUARY 2018 www.e-mj.com do contract negotiations impose fiduciary obligations. Despite the letter, the pro- posal and the meetings wherein fiduciary relationships were being discussed, none could be said to exist at the time Lac made its move, according to three Su- preme Court justices. "These things are never that clear," Keevil said. "I am not a lawyer." He did say, however, that some clarity might be found in an earlier case that indirectly impacted Teck. Leitch v. Texas Gulf Sulphur In 1959, Texas Gulf Sulphur (TGS) launched an aerial exploration campaign covering the Abitibi region of the Cana- dian shield. It was initiated by geologist Walter Holyk, "who was one of the earliest proponents of the then-new volcanogenic theory of the origin of many base metal mines," Keevil wrote. "Holyk had worked in New Brunswick, where some large de- posits of that type had been discovered, and had concluded that similar opportu- nities might occur in the Abitibi region of Ontario and Quebec, stretching from Tim- mins to Mattagami." The campaign was waged from the company's helicopter-mounted electro- magnetic sensor system. The operators would routinely test the system over a "small rock outcrop in the Kidd Town- ship, 20 kilometers north of Timmins," Keevil wrote. "The lore has it that the Kidd Creek anomaly they used as a test case was so strong that it was thought it must be caused by graphite," he wrote. "For that reason, TGS never tested it by drilling early in the program, even as it was flown over and used to calibrate the survey equipment first thing every morn- ing." Another account, "probably more accurate," is the company couldn't gain access to the property for four years while it negotiated with the owners; however, it "could fly over and test it from the air with impunity." The helicopter was used to AEM-sur- vey "large swaths of Northern Ontario and Quebec" before it "crashed" and was "scuttled," Keevil wrote. "TGS discov- ered countless anomalies, which is one of the hidden difficulties of owning one's own airborne geophysical system." Follow-up costs can dwarf the origi- nal survey costs. Thus, around this time, TGS contracted Leitch, "a small explora- tion company run by one of the icons of the Canadian exploration industry," Karl Springer, to review the airborne EM data and follow up, Keevil said. "Then they drew the contract up on a piece of pa- per and they had a map sketched in by hand." The contract held that "should Leitch make a discovery on property in the new joint venture area, the two par- ties would share in it, with TGS holding a 10% interest and Leitch holding 90 per cent," Keevil wrote. TGS drilled 65 anomalies in Ontario and Quebec, and then the funds started to dry up. "Project geologist Ken Darke in Timmins was told to cease and desist from more foolish drilling," Keevil wrote. By then, negotiations with the Hendrie Estate had resulted in TGS being allowed to drill the Kidd Creek anomaly. "In No- vember 1963, Darke drilled a hole named Dragon 66, after the year of the dragon and the fact that it was the 66th and last anomaly to be drilled before the project really shut down," Keevil wrote. "It en- countered 200 meters of high-grade cop- per and zinc mineralization, running over 1% copper and 7% zinc, and contained significant values in silver as well." The deposit would prove to be "the largest base metal ore body of its type ever found in Canada," Keevil wrote. TGS initially stayed mum while it locked in more pertinent properties. Charles Fried, in his book Contract as Promise: A The- ory of Contractual Obligation, wrote that the mineral rights cost TGS a total of $18,000, and the property was estimated to be worth $100 million. But "diamond drillers and geologists talk," Keevil wrote. Rumors, frenzied stock purchases, and accusations followed. According to the Securities and Ex- change Commission, TGS leadership and employees acted quickly on assay results by buying up company stocks and then sending out a press release on April 12, 1964, that served to quell rumors of a big discovery. Three days later, official drill results were announced, the news of which didn't hit the public until the next day. According to the SEC, TGS insiders continued to purchase stock between the April 12 and April 16, which resulted in the court handing down a conviction for in- sider trading. "Defendants should not act upon the information until the information is disseminated to the point that the pub- lic would have had a reasonable opportu- nity to act on it," Case Briefs reported. Underground mining at Hemlo, centered on the Williams property. (Photo: Barrick)