Canadian Royalties hits new zone (March 10, 2003)

Vancouver — The economic promise of the Expo-Ungava nickel-copper-platinum-palladium property got a shot in the arm following operator Canadian Royalties‘ (CZZ-V) discovery of yet another high-grade zone on the northern Quebec project.

Dubbed Tootoo, the latest find lies 25 km west of the Mesamax zone and is the third massive sulphide occurrence discovered by the junior in the past two years.

The best drill results came from hole 2, which yielded 2% nickel, 1.91% copper, 0.11% cobalt, 0.6 gram platinum and 2.62 grams palladium per tonne over 22 metres. Included in this section was a higher-grade portion running 3.14% nickel, 2.56% copper, 0.17% cobalt, 0.8 gram platinum and 2.6 grams palladium over 10.5 metres.

Collared from the same site and testing the mineralization updip, hole 1 cut 44.1 metres grading 0.3% nickel, 0.4% copper, 0.02% cobalt, 0.22 gram platinum and 0.91 gram palladium.

Hole 3 targeted the downdip extension of the zone from the same site and returned 11 metres grading 0.3% nickel, 0.46% copper, 0.01% cobalt, 0.3 gram platinum and 1.09 grams palladium.

Mineralization is hosted in pyroxenite and consists of disseminated-to-massive pyrrhotite, pentlandite and chalcopyrite.

The holes were collared on the southwestern portion of the 5-km-long Tootoo pyroxenite. The only previous drilling in the area occurred in 1969, when a program targeted mineralization at the pyroxenite contact.

Moving 3 km to the west at the Mequillion North target, the company sunk six holes from two sites covering a 200-metre strike length of a pyroxenite-peridotite body. The best results came from the westernmost holes. Hole 1 cut 22.3 metres grading 1.05% nickel, 0.93% copper, 1.01 grams platinum and 3.33 grams palladium, while some 200 metres to the east, hole 3 yielded 26.8 metres grading 1% nickel, 1.08% copper, 0.72 gram platinum and 2.19 grams palladium.

The Snow Owl target was tested by one hole, which cut 79 metres of disseminated sulphides, with a 40.5-metre section running 0.81% nickel, 0.21% copper, 0.29 gram platinum, and 0.64 gram palladium. The hole, which failed to reach the lower contact of the ultramafic body, was collared some 2 km east-southeast of the historic Expo Sulphide zone.

Canadian Royalties also completed four holes in the Kehoe area, 9 km west of the Expo deposit.

Testing two separate ultramafic bodies from two sites cutting disseminated pyrrhotite, chalcopyrite and pentlandite, the best hole returned 11.7 metres grading 0.27% nickel, 0.49% copper, 0.37 gram platinum and 1.51 grams palladium.

The junior sparked interest in the project last year by reporting a series of high-grade drill intercepts at the Mesamax zone (T.N.M., Nov 18-24/02).

Some 3 km away, last year’s drill program over the TK target outlined a zone of mineralization over a 300-metre strike length to depths of up to 100 metres.

Canadian Royalties can earn up to a 70% interest in the property by spending $1.75 million over four years (now completed). It can boost its stake to 80% by completing a bankable feasibility study.

The property is 15 km south of Falconbridge‘s (FL-T) Raglan nickel-copper mine, and hosts three mineralized structures, Expo, Cominga and Mesamax, all of which were discovered in the 1960s. Resources at Expo-Ungava, which lies 12 km east of the new find, are pegged at 17 million tonnes grading 0.6% nickel and 0.8% copper. Included is a higher-grade core of some 3 million tonnes grading 1% nickel and 1% copper.

The junior has been aggressively exploring a 35-km-long sequence of ultramafic rocks known as the South trend, where mineralization consists of disseminated, net-textured and massive sulphides positioned in the basal portions of ultramafic flows and intrusions.

In the summer of 2002, the junior drilled more than 100 core holes on the property and intends to spend about $4 million this year.