Canadian Royalties adds to Nunavik Nickel resource

Canadian Royalties (CZZ-T, CRYAF-O) says it will revise its mine plan for the Nunavik Nickel project in Northern Quebec to include the Allammaq deposit, a discovery made only last August.

The company has received an initial resource estimate for Allammaq, boosting tonnage of indicated resources for the project by 11.9% and inferred resources by 12.7%

Vice-president of exploration, Grant Arnold, says that because Allammaq is close to the high-grade Mesamax deposit, the integration of Allammaq resources to the mine plan is now a “top priority” and that it shows the project’s potential for expansion.

“The identification of significant resources at Allammaq demonstrates that systematic exploration is the largest single creator of value for our company,” Arnold said in statement.

Indicated resources now stand at 19.4 million tonnes (up 2.1 million tonnes) grading 0.97% nickel, 1.18% copper, 0.05% cobalt, 0.14 gram gold per tonne, 0.56 gram platinum and 2.27 grams palladium.

Inferred resources are 4.1 million tonnes (up 461,000 tonnes) grading 0.96% nickel, 1.17% copper, 0.05% cobalt, 0.16 gram gold per tonne, 0.63 gram platinum and 2.45 grams palladium per tonne.

Two mineralized zones were discovered in the Allamaq area, but it was the basal zone that is the most economically important, the company says. The thickness of Allammaq is more than 40 metres in the central portion. Significant sulphide mineralization has been outlined on five 50-metre-spaced sections over dip lengths of up to 150 meters and stretches over a 250-metre strike length.

Canadian Royalties has already begun construction of a $466-million project that would see nine years of production at a rate of 3,500 tonnes per day from the Mesamax, Ivakkak and Expo deposits. Production is expected to start by the second quarter of 2010.

The company hopes to produce 26 million lbs. nickel in concentrate, 38.8 million lbs. copper in concentrate, 900,000 lbs. cobalt in concentrate, 14,500 oz. platinum and 78,600 oz. palladium per year over nine years.

An economic assessment was completed for the Mequillon deposit projected the project life could be doubled to 18 years.

Canadian Royalties shares rose 2 in Toronto today to $1.87 each on a trading volume of more than 94,000 shares.