Diamonds North finds more stones at Blue Ice

Having completed a second season of exploration field work on the Victoria Island diamond projects in the High Arctic region of both Nunavut and the Northwest Territories, Diamonds North Resources (DDN-V) now believes the Galaxy and King Eider corridors hold the potential for some 20 million tonnes of kimberlite.

“One of the challenges we’ve faced has been, Do we have enough tonnage of kimberlite on the project?” says Mark Kolebaba, president of Diamonds North. “If we had only one to five million tonnes, we might have to re-think what we’re doing.” (The 20-million-tonne concept is based on limited drilling into a dozen or more bodies and ground geophysics.) “It’s fairly conceptual, but it does show that we have potential to generate tonnes.”

The bigger challenge, however, lies in determining if there is sufficient grade and value to make this project work, given that it is so far north. “Next year’s program will entail going out and bulk sampling those kimberlites along the two trends that warrant bulk sampling based on the microdiamond data,” says Kolebaba.

The Galaxy trend is a northwest-oriented structural corridor, along which a large sub-vertical kimberlite dyke system is intermittently exposed. This 20-km-long corridor straddles the Northwest Territories-Nunavut border and is part of the Blue Ice project, where Teck Cominco (TEK-T) is committed to providing half of the $3 million required for exploration this year.

Flanked by the Snow Goose pipe on the northwestern end of the Northwest Territories side and by the Snow Bunting kimberlite dyke at the southeastern end on the Nunavut side, this corridor consists of a series of multiple and en echelon kimberlite dykes and blows.

A second parallel magnetic trend of kimberlite bodies and showings is centred on the King Eider pipe, 30 km to the north on Diamonds North’s wholly owned Hadley Bay project.

The Blue Ice project is 240 km west-northwest of Cambridge Bay, the closest community, and covers 1,820 sq. km of staked claims. Last year, Diamonds North spent $1.2 million on the Nunavut portion of Blue Ice, completing 380 line km of ground magnetics and nine drill holes totalling 1,067 metres. The drilling uncovered three new kimberlite dyke-like bodies, Vega, Virgo and Carina, while prospecting turned up three separate kimberlite float occurrences, Sculptor, Pegasus and Zeta, which were manually trenched. Diamonds North also re-tested the Snow Bunting and Sandpiper, two of 16 known kimberlites discovered on Victoria Island by De Beers in the late 1990s. De Beers walked away from the area in 2000 but still retains the right to market 35% of any production from its original Mon claims now held by Diamonds North.

With the exception of Virgo, which did not provide enough kimberlite material for analysis, all of the kimberlites sampled last year proved to be diamondiferous. In particular, Sand Piper East and Sculptor delivered good initial microdiamond results, demonstrating high counts and a trend towards larger stones.

This year, Teck joined Diamonds North in further exploring the central Blue Ice project. The 2003 drilling concentrated on the collection of larger samples from some of the more promising sites, including Sculptor, Pegasus, Snow Goose, Snow Bunting and Sand Piper East, and provided additional sampling on Vega, Gosling and Carina. In total, 20 holes were drilled into 11 targets along the Galaxy trend, for a total of 1,833 metres.

Three new discoveries were made on the southeastern end, where drilling encountered kimberlite dykes at each of the SLT4, Fornax, and Vega West prospects. In addition, another new kimberlite showing, dubbed Orion, was found by prospecting along trend of SLT4. It is also believed to be a dyke. As well, the 2003 program on Blue Ice included 11,360 line km of airborne magnetic geophysics to provide complete coverage over the entire property. Only a quarter of the property had been flown previously. “That survey has been really quite interesting,” says Kolebaba. “Based on a quick and dirty look, we’ve got a number of new anomalies, and potentially another trend that falls in between King Eider and Galaxy.”

Close to 2.4 tonnes of kimberlite samples were submitted to Lakefield Research for caustic fusion analysis and microdiamond recovery. So far, Diamonds North has received results for only the SLT4 and Snow Bunting kimberlites.

Snow Bunting is a steeply dipping kimberlite dyke structure, with an estimated true width of 8 metres. It is defined by a distinct magnetic anomaly measuring up to 200 metres long. De Beers originally recovered 23 diamonds from 137 kg of kimberlite collected from a single reverse-circulation hole drilled in 1997. Diamonds North re-tested Snow Bunting in 2002 with an angle hole: a 16.7-kg sample yielded 15 microdiamonds, four of which exceeded 0.5 mm in two dimensions.

SB1 and SB2

Diamonds North returned this year and collected a much larger sample from Snow Bunting by drilling downdip to a depth of more than 90 metres. Two distinct phases have been identified and sampled separately: a dominant olivine macrocrystic hypabyssal kimberlite, labeled SB1, and a strongly serpentinized, clay altered macrocrystic kimberlite, called SB2.

A composite sample of SB1, weighing 163 kg, yielded 77 microdiamonds, including four stones exceeding 1 mm in two dimensions. The largest stone measured 1.34 by 1.14 by 1.2 mm. By comparison, a 54.6-kg sample of SB2 returned 11 microdiamonds, with only one stone greater than 0.5 mm in two dimensions. A high proportion of the Snow Bunting diamonds is described as transparent and white (colourless). A smaller population of the stones is off-white, yellow and brown in colour. Of note, four pink transparent diamonds were recovered.

A more detailed look at the diamond-size distribution using square mesh sieve sizes is provided in the accompanying table.

SLT4 was discovered near the Zeta and Sculptor showings, 6.5 km from the southeastern end of the Galaxy trend. It is a steeply dipping, macrocrystic hypabyssal kimberlite dyke. Two holes tested the structure, with the first cutting 1.7 metres of kimberlite at an angle of minus 60. To maximize sample collection, a second nearby hole was steepened to minus 85 and drilled downdip, intersecting 41.3 metres of kimberlite. This equates to a true thickness of only 3.6 metres, including two limestone blocks of 1 metre and 0.19 metre.

A collective 79.8-kg sample of SLT4 turned up 44 microdiamonds, the largest stone measuring 1.28 by 1 by 0.57 mm.

Once all the results from the 2003 program are tabled, Teck can elect to earn an initial 30% interest in the Blue Ice claims by exercising $500,000 worth of Diamonds North warrants and spending $9.5 million on exploration over three years. Teck can then increase its interest to 50% by incurring an additional $5 million over one year. Should it continue funding all exploration costs to the completion of a feasibility study, the major would boost its stake to 65%. A final 5% can be earned by arranging project financing.

Six projects

Diamonds North holds more than 6,070 sq. km on Victoria Island through six projects. The Hadley Bay project is immediately north and northeast of Blue Ice and is wholly owned by Diamonds North. Canabrava Diamond (CBD-V) funded exploration at Hadley Bay in 2002, spending $1.3 million on airborne and ground magnetic surveys, plus 1,103 metres of drilling in 13 holes. Despite discovering five new kimberlites, of which four were barren of diamonds while the fifth was not analyzed, as the sample was too small, Canabrava pulled out of the project. The 2002 program also re-tested the known diamond-bearing King Eider and Turnstone kimberlites.

Based on the magnetic geophysical data and the discovery of several new kimberlite showings this summer, Kolebaba estimates that the King Eider trend is 25 km long.

The Holman project, which covers 516 sq. km west of Blue Ice, is under option to Serengeti Resources (SIR-V), which can earn a half-interest by spending $2.1 million over three years. One strong magnetic anomaly was drilled this summer without intersecting any kimberlite. In addition, a low-level helicopter-borne magnetic survey was flown over 23 discrete targets. No “first order” potential kimberlite targets were identified and no immediate ground follow-up has been recommended.

Majescor Resources (MAJ-V) can earn a half-stake in the 1,176-sq.-km Wellington project, immediately east of Blue Ice, by spending $2.2 million over three years. During the fall of 2002, Diamonds North completed a helicopter-borne magnetic survey over 16 isolated geophysical targets, further defining six “pipe-like” features and three potential kimberlite dyke-like anomalies. This summer, three of the anomalies were drilled, but no kimberlite was intersected. The source of these magnetic anomalies remains unexplained.