De Beers completes Kennady bulk sample

Vancouver — De Beers Canada Exploration, a wholly owned subsidiary of De Beers Consolidated Mines (DBRSY-Q), has collected two sample from the AK diamond claims in the Northwest Territories.

One sample, weighing 307 tonnes, came from the Hearne kimberlite pipe. The other, weighing 550 tonnes, came from the 5034 pipe.

These kimberlite bodies represent the most promising of the five diamondiferous bodies located in the Kennady Lake portion of the claims. They were collected from three holes in the high-grade northern part of the Hearne pipe and four holes in the high-grade eastern lobe of the 5034 pipe.

They are being processed in Grand Prairie, Alberta. The sample concentrates will be shipped to South Africa for diamond recovery. The diamonds will be valued in London at the Diamond Trading Company and the revenue-per-tonne modeling will be performed in Johannesburg. Final results are expected in late summer.

The latest bulk samples are part of a $10-million winter program aimed at enhancing the economics of the project. De Beers hopes to recover 1,000-1,250 carats from each of the two pipes.

By recovering a larger number of diamonds, De Beers hopes to increase the confidence level of its scoping study model. Last year, the South African major tabled a study that examined both open-pit and underground mining options. Open-pit mining was proposed for the 5034 and Hearne pipes and for a high-grade zone within the top 140 metres of the Tuzo pipe. While the recent study agrees that this is the most economic scenario, it also says the deposit lacks the critical mass to achieve the 15% rate of return required to proceed to feasibility.

In 1999, De Beers collected bulk samples from a cluster of four pipes, including 5034, Hearne, Tuzo and Tesla. While results were encouraging for the 5034 and Hearne pipes, the grade and carat values for the Tuzo pipe were less than anticipated.

A total of 1,044 carats were recovered from 609 tonnes of drill sample from the 5034 pipe. The Hearne pipe yielded 856 carats from a 469-tonne sample. Tuzo returned 540 carats from 523 tonnes and Tesla yielded 64 carats from 184 tonnes.

Based on these results, the 5034 kimberlite contains a modelled resource of 12.5 million tonnes (to a depth of 300 metres) grading 1.64 carats per tonne at an average value of US$63 per carat, or US$103 per tonne. The 5034 kimberlite is subdivided into four lobes, based on internal geology. The north lobe extends partly underground.

The Hearne pipe hosts 7.2 million tonnes grading 1.71 carats per tonne at US$65 per carat, or US$111 per tonne. Hearne consists of a northern and southern lobe which have been further subdivided into multi-phases.

The AK claims are held 44.1% by Mountain Province Diamonds (MPV-T), 4.9% by Camphor Ventures (CFV-V) and 51% by De Beers Canada. The major diamond producer has the right to earn up to a 60% interest in the property by taking the project to commercial production.