DIAMOND NEWS ROUNDUP — Kennecott deal adds momentum to Alberta diamond hunt

Kennecott Canada is joining the search for diamonds in cattle country.

By agreeing to spend $3 million on exploration over the next three years, the company can earn a 60% interest in a 230,000-acre land package northwest of Hinton, Alta. The property is currently held 55% by New Claymore Resources (VSE), 35% by Montello Resources (ASE) and 10% by Troymin Resources (ASE).

Kennecott will initially contribute $300,000 towards the current phase of exploration, which is being managed by New Claymore and includes an expanded stream-till sampling program and geophysical work.

To date, 23 diamonds have been recovered from a small creek at the centre of the permits.

In a separate agreement, Kennecott can earn a 60% interest in the Rich property, consisting of 184,000 acres of diamond permits adjacent to New Claymore’s property (the Kennecott Option property), by spending $1 million over three years. The Rich property is held 35% by Montello, 10% by Troymin and 55% by Rich Resource Investments, a private company.

Excluded in the Kennecott agreements are an additional 217,200 acres of permits held 60% by Montello and 40% by Troymin. These claims lie west of the Kennecott Option property. Montello is granting a 5% interest each to New Claymore and Rich Resource.

Saskatchewan

* Meanwhile, in neighboring Saskatchewan, Kennecott continues to work the Candle Lake joint venture.

A total of 1,345 kg of core from nine diamond drill holes, in what were previously known as kimberlites 29 and 30, recovered 32 macrodiamonds and 149 micros.

As operator, Kennecott can earn a 60% interest from partners War Eagle Mining (VSE) and Great Western Gold (VSE) by spending $8 million on exploration and development over five years.

Drilling at the property, situated near Fort a la Corne, inferred a potential resource of 70 million tons for a single kimberlite body identified as kimberlite 30. Of the diamonds recovered, the largest weighed up to 1.2 mm.

The next stage of exploration includes up to 10 drill holes in kimberlite 28, along with an airborne geophysical survey, which will be used to aid in delineating additional targets.

* Proceeds from an arranged $250,000 private placement will be used by Nu-Dawn Resources (VSE) to explore its fully owned White Swan Lake property, adjacent to the Candle Lake project.

An airborne magnetic survey has identified several magnetic anomalies, which are regarded as potential kimberlite targets.

* Kensington Resources (VSE) has dropped its option with Altmark Energy (ASE) to earn a half interest in the Apron Deposit diamond properties, also situated near Fort a la Corne.

The properties were previously held by Rhonda Mining and Aaron Oil.

Kensington plans to focus its attention on the Fort a la Corne joint venture with partners Cameco (TSE), Uranerz Exploration & Mining and Monopros.

Ontario

Initial drilling on the OPAP kimberlite pipe in northeastern Ontario is complete.

Joint-venture partners Consolidated Pine Channel Gold (VSE) and JNR Resources (VSE) have pulled 5,000 lb. of drill core from the five holes drilled on the OPAP pipe. Random, 33-lb. samples will be taken for heavy metal separation and microprobing, while 4,000 lb. will be sent for caustic fusion testing.

Drilling on nearby targets has intersected kimberlite at 12 ft. below surface on target A-31, which is 3 miles from the OPAP pipe.

The Consolidated Pine Channel-JNR Resources joint venture also expects to be able to acquire a 2,000-acre land package in Ontario’s Casey and Bucke twps. Airborne coverage of the area indicates the presence of at least seven structures that appear to bear the signatures of kimberlite pipes.

Northwest Territories

A mini-bulk sampling drill program on the Drybones Bay kimberlite pipe, 50 km southeast of Yellowknife, is planned for the winter.

Trade Winds Resources (VSE), which can earn an 80% interest, intends to delineate the pipe and obtain a 6-to-10-tonne bulk sample.

United States

In Idaho, at the Thorn Creek project, Golconda Resources (ASE) plans to extract mini-bulk samples from two lamproitic tuff target areas.

Large-diameter drilling will be used to take a 10-ton sample from the upper 200 ft. of the crater facies tuff in each area. The two targets are separated by a distance of 4 miles.

Africa

* In South Africa, a second kimberlite fissure has been found on the SUF-1 property of SouthernEra Resources (TSE).

The fissure is parallel to, and 750 metres north of, the original fissure discovery. Several tonnes of material are being excavated for immediate testing.

Sampling and trenching on the main fissure has defined 4 km of strike length, and the zone is open both to the east and west. Bulk-sample processing from the main pit is continuing at the rate of 5 tonnes per day.

In addition, a large-diameter percussion drill is on site and will begin taking 5-tonne samples along the main structure shortly.

To date, 364 carats of diamonds have been recovered from 86.6 tonnes of material, for an overall grade of 4.2 carats per tonne.

* In Tanzania, Serengeti Diamonds (VSE) has acquired an 80% interest in 10 diamond mining leases for US$300,000.

The properties, which were acquired from Tanzania Diamond Mines, comprise three groups of mining blocks over, or adjacent to, known diamondiferous kimberlites and seven reconnaissance licenses. The pipes are currently being worked by artisanal miners.

Bulk testing by Tanzania Diamond Mines indicates that one of the three groups of mining blocks (the Kahama group) has a potential resource of some 400,000 carats. A 300-ton gravel sample recovered 306 carats, including one stone measuring 3.65 carats and 138 stones over 1 carat.