Selkirk First Nation sues Minto Metals Corp. alleging company owes $1.3M+ in royalties

A Yukon First Nation is suing the Minto Metals Corp., alleging that the company, which suddenly abandoned its mine in central Yukon in mid-May, still owes it more than $1.3 million in royalties.

Selkirk First Nation (SFN) filed a statement of claim to the Yukon Supreme Court on July 14. It joins about two dozen other parties, including the Yukon government, the Yukon Energy Corporation and a number of contractors, who say Minto failed to pay its bills and dues in the months and in some cases, years before shutting down.

The Minto mine is located near Pelly Crossing, Yukon, and on SFN Class A settlement land, meaning the First Nation owns both surface and subsurface rights. A long-standing "net smelter return" royalty agreement requires Minto to pay the First Nation 0.5 to 1.5 per cent the value of all concentrates or minerals shipments sold every quarter, depending on the market.

According to the lawsuit, Minto, in late April, confirmed that it owed SFN $1,340,895.65 for shipments sold between Jan. 1 to March 31.

The royalty was supposed to be paid by May 20, but "Minto has failed or refused to pay" the amount to SFN to date, the lawsuit says.

Besides payment of that royalty, the lawsuit also argues that SFN is owed 1.5 per cent of the value of any product sold after March 31, noting that Minto "continued to mine and process ore into concentrate" until May 12.

Minto has not yet filed a statement of defence.

Twenty-four separate legal actions have been filed against Minto in the Yukon Supreme Court since the company abandoned the site, with the claims totalling tens of millions of dollars. Lawsuits and petitions have also been filed to courts in British Columbia, where Minto was incorporated.

Aprovincial supreme court judge is currently hearing arguments to have the company declared bankrupt and placed into receivership.