Hoping to capitalize on a revitalized diamond exploration sector that has been fueled by recent kimberlite discoveries in Quebec and the Coronation district of Nunavut, Major General Resources has spun-off its diamond properties into a newly created company called Diamonds North Resources.
In the process, shares of Major General were rolled back on a 3-for-1 basis. Shareholders of the consolidated Major General, re-named
Diamonds North has raised $500,000 by placing 1 million units at 50 apiece with U.S. Global Investors. The unit placement consisted of one share and half a warrant. A whole warrant is exercisable at 60 for one year. The company has filed a prospectus offering to raise a further $1.5 million through the sale of 3 million units priced at 50 each. On completion of the financing, the company will have 10.3 million shares outstanding. Diamonds North has applied for a listing on the Toronto Stock Exchange. Mark Kolebaba, formerly with BHP Billiton Diamonds’ exploration team, was named president of Diamonds North.
Diamonds North holds more than 4,050 sq. km on Victoria Island in the Arctic region of Nunavut, where 16 diamondiferous kimberlite pipes and dykes were discovered by
Diamonds North has been optioning off separate parcels of ground to juniors, including
A drill is already turning on the Yankee property, a joint venture with
Diamonds North is also preparing to drill up to eight geophysical targets on the neighbouring, wholly owned Blue Ice property, which covers 809 sq. km.
Canabrava can earn a half-interest in Diamonds North’s Hadley Bay project by spending $5 million and issuing 250,000 shares over four years. Diamonds North remains the operator. The project area covers 11,970 sq. km and is known to contain five diamondiferous kimberlite bodies, previously discovered by De Beers. A first stage of exploration, set to begin in mid-July, will entail drill-testing 10 targets.
Major General, Diamonds North’s predecessor, had been active on Victoria Island since 1994 when it acquired 19 prospecting permits. Victoria Island is at the northern end of the Slave Craton, 700 km north of Yellowknife. The property holdings were subsequently optioned to
The Canadian exploration division of De Beers struck a deal with Major General and Ascot in March 1998 and acquired the right to earn a 51% interest in the Victoria Island Washburn project by spending $2 million on exploration and paying $200,000 over three years.
De Beers had made several diamondiferous kimberlite discoveries 50 km north of the project’s northern boundary. In the summer of 1998, De Beers drilled eight geophysical targets within an 80-sq.-km area and discovered five kimberlite bodies on the northern portion of the joint-ventured Victoria Island property. These kimberlites, known as Phalarope, Golden Plover, Longspur, Snowy Owl and Whimbrel, were initially tested with short percussion holes, which penetrated only 5-11 metres into each kimberlite. Microdiamond results from the discovery holes were as follows:
n the Snowy Owl kimberlite returned a total of 85 micros and five macros from an 88-kg sample (a macro here is defined as exceeding 0.5 mm in at least one dimension);
n a 180-kg sample from Golden Plover yielded 41 micros and three macros, including two stones greater than 0.5 mm in two dimensions;
n Longspur yielded 36 micros and three macros, including one stone exceeding a 1-mm sq. mesh screen size, from 90 kg of sample;
n Phalarope returned six micros from 180 kg of material; and
n Whimbrel gave up just a single micro from 180 kg of tested kimberlite.
The Snowy Owl, Golden Plover and Phalarope kimberlite samples included both volcanic crater and hypabyssal phase kimberlite, whereas the Longspur and Whimbrel samples contained only hypabyssal material.
As part of the 1998 exploration program, De Beers flew helicopter-borne geophysical surveys over nine target areas and investigated 10 geophysical targets and four anomalous areas of indicator mineral by collecting 185 till samples.
Eight holes
In early 1999, after completing ground magnetic surveys totalling 200 line km over the Snowy Owl, Golden Plover and Longspur kimberlites, De Beers drilled eight core holes for a total of 854 metres.
The Golden Plover and Longspur, as well as two new targets, Arctic Tern and Horned Lark, were each tested with one hole. Dyke-like intercepts of kimberlite in the range of 2-8 metres were intersected at the Golden Plover, Longspur and Arctic Tern kimberlites. A 5-metre intercept from Arctic Tern yielded no diamonds in a 22-kg sample.
At least seven separate northwesterly oriented dykes have been interpreted from the magnetic surveys.
A vertical hole on Horned Lake intersected 78 metres of crater facies kimberlite before shutting down while still in the unit at a depth of 97 metres. A 10-kg sample taken from 15-52 metres of depth returned one macro exceeding a 1-mm square screen size. A second sample interval from 52-96 metres contained six micros per 10 kg.
The Snowy Owl kimberlite was tested with four additional holes, including one vertically drilled hole, to a depth of 130 metres. The pipe-like body is interpreted to have a surface expression of about 1 hectare. A total of 369 micros and four macros were recovered from 438 kg of tested material. Microdiamond fragments totalling some 417 are excluded from the final count. The fragments may be the result of a larger stone’s having been crushed.
Washburn dropped
In February 2000, after spending $1.3 million on exploration, De Beers dropped the Washburn project in the final year of its option arrangement with Major General and Ascot. Major General later acquired De Beers’ winterized camp on Victoria Island and 29 mineral claims after the major pulled out of the region entirely. De Beers retains the right to market any diamonds recovered from the 29 claims.
During the summer 2000 field season, Major General and Ascot spent $330,000 exploring Washburn with a 90-sq.-km helicopter magnetic survey and till sampling. A new narrow kimberlite dyke, dubbed Ptarmigan, was uncovered in hand-trenching. The 20-cm-wide dyke yielded 40 micros and five macros from 77 kg of surface sample. In addition, a further 195 kg of stored core from the multi-phase Snowy Owl kimberlite were tested for microdiamonds, returning 122 micros and 10 macros, including one stone greater than 1 mm in two dimensions.
The Washburn project is held 52% by Diamonds North and 48% by Ascot. The pair recently struck a preliminary deal with Patrician Diamonds, which can earn a 40% interest in the 245-sq.-km. project by spending $2.5 million over three years. Patrician plans to drill three land-based targets in a program scheduled to start in late July. The
program will entail follow-up ground geophysics and trenching on the kimberlite dyke system.
Patrician also optioned the Victoria Island Wellington property from Diamonds North. The Wellington claims are north and east of Washburn, covering an area of 1,990 sq. km and including one known kimberlite dyke. Patrician can earn a half-interest by spending $2 million and issuing 200,000 shares to Diamonds North, which remains the operator of the project. Starting in mid-July, detailed geophysics will be conducted over selected targets in preparation for drilling.
Two agreements
In August 1999, Dia Met Minerals entered into two separate option agreements to explore for diamonds on Victoria Island. Under the first agreement, Dia Met had the right to earn a 51% interest in the Mariner project, held by Major General and Ascot, in return for spending $2.5 million.
The second agreement allowed Dia Met to earn a 51% interest from Major General in the Homerun project by spending $4.5 million. The mineral claims on both projects covered 2,384 sq. km in the central part of the island, close to kimberlites discovered by De Beers, including the Snowy Owl kimberlite.
Dia Met collected about 1,000 heavy mineral samples in 1999. The results revealed “high-interest” indicator mineral chemistry in one area, which was then flown with 6,500 line km of helicopter-borne magnetic surveys. Additional till samples were collected from areas of interest in the summer of 2000. Dia Met was subsequently taken over by
In addition to its Victoria Island holdings, Diamonds North holds an interest in the Misty Lake claims, immediately south of the Kennady Lake joint venture between De Beers and
Diamonds North also owns half of the Gten property, 80 km southeast of Yellowknife, near Drybones Bay.
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