St. John’s, Nfld. — With little fanfare,
Barrick contributed more than $300,000 to prospecting, regional geological mapping, and geochemical sampling on a 100-km-long claim package before withdrawing. The Barrick deal unleashed an area play in the Botwood Basin area that triggered a record year of claim-staking on the island in 2002, surpassed only by the staking rush of Voisey’s Bay in 1995. Barrick’s departure from “The Rock” has been eased by the arrival of
“We’re experiencing a very good, fairly stable amount of activity and staking,” says Ken Andrews of the Mines and Energy Ministry’s Mineral Lands Division. There have been 10,165 new claims staked in Newfoundland and Labrador so far this year [to the end of October], and Andrews forecasts there will 55,000 claims held in good standing at year-end.
Exploration expenditures in the province for 2003 are forecast at $23 million but could reach as high as $30 million, compared with $44 million in 2002 and $28 million in 2001. The amount of diamond drilling in the province is expected to approach 65,000 metres by year-end, comparable to 2002 levels, with 29 applications for exploration drilling on the island and nine in Labrador so far this year. About two-thirds of the drilling is on gold projects.
About 3,700 new claims have been staked to date in Labrador, mostly in the Central Mineral belt, where Altius,
The Central Mineral belt is Middle Proterozoic and represents a combination of several geological domains or provinces. It extends inland from the coast of Labrador for 250 km almost to the Quebec border. This belt has seen a lot of exploration in the past, primarily for uranium from the mid-1950s through to 1981. It features hundreds of recorded historical copper and uranium occurrences, plus showings of gold, base metals and rare earth elements. Altius acquired a 293-sq.-km package of 15 properties along this belt in partnership with
This past summer, the joint venture carried out reconnaissance field investigations and a review of archived drill core. “We just wanted to cover a lot of area and look at a lot of rocks to see if we might be on the right track,” says Roland Butler, vice-president of Altius. “We believe we have identified an area that has good potential.”
Field crews re-examined and sampled a lot of the old trenching. Grab samples taken from known uranium showings on the Post Hill property returned values highlighted by: 1% copper, 0.54 gram gold and 78.6 grams silver per tonne; 1.46% copper, 0.29 gram gold and 72.8 grams silver; and 2.96% copper, 0.87 gram gold and 77 grams silver.
“It was encouraging to see more widespread copper from what we had first anticipated,” says Butler. “We recognized broad sodic-calcic alteration systems and localized zones of potassic alteration along major shear zones. There is a strong structural control to mineralization.” Sulphide mineralization including chalcopyrite, bornite and molybdenite appears in close spatial association with magnetite and hematite iron-oxides.
Exploration in 2004 will likely consist of regional geophysical surveys and ground follow-up of geochemical sampling. “It’s certainly an area that is open for new ideas and fresh perspectives,” Butler adds. “This belt of mineralization deserves a lot closer investigation, and it is something we will continue working on.”
Voisey’s Bay
Exploration in Labrador continues to focus on base metals and nickel. Not surprisingly, most of the activity is centred around the Voisey’s Bay nickel project, where
The proposed open pit contains the Ovoid deposit (and what is referred to as the Mini-Ovoid deposit) and the near-surface portion of the Southeast Extension deposit. The overall waste-to-ore stripping ratio is 1.3-to-1. Annual production is expected to average 49,895 tonnes nickel, 38,555 tonnes copper and 2,268 tonnes cobalt at an estimated operating cost of US93 per lb., net of byproduct credits. Two nickel concentrates containing cobalt will be produced, as well as a copper concentrate.
The first phase of the Voisey’s Bay project includes a hydromet research and development program (estimated cost: US$134 million), the construction of concentrate-handling facilities at Inco’s Sudbury and Thompson operations (US$47 million), and an exploration campaign (US$13 million). The total capital cost of Phase 1 is US$776 million.
Civil construction is well under way and the Voisey’s Bay camp facilities have been expanded to accommodate 730 workers. The permanent airstrip is completed, as are most of the site roads. Concrete foundation work on the concentrator plant is almost finished and structural steel is being erected on the grinding bay and the permanent fuel storage tanks. The entire mine-mill complex is scheduled to be completed by the end of 2005, which would allow for the first shipment of concentrates in July 2006.
Inco has awarded $423 million to date in construction support contracts, including $66 million on procurement. There are currently 1,128 workers employed on different components of the Voisey’s Bay project, including 858 people from the province of Newfoundland and Labrador.
The second phase of the project will include construction of a commercial hydrometallurgical processing plant at Argentia, Nfld., or, in the event that such a facility is deemed technically or economically unfeasible, a conventional refinery, to be in operation no later than the end of 2011. Inco has guaranteed it will replace all the nickel concentrate shipped out of the province from other sources worldwide.
As part of the research and development program, Inco built a mini-pilot plant in Mississauga, Ont., at a 1-to-10,000 scale of the eventual commercial plant planned for Argentia. “To date, we’ve had two successful runs of ore through the plant, just to prove the flow sheet and to make sure we feel comfortable with the technology,” says Phil du Toit, managing director of Voisey’s Bay Nickel Co. A third integrated campaign is to be completed in the latter part of November.
Inco will use the results from the mini-plant and examine the design criteria and material application as it sets about building a 10-tonne-per-day demonstration plant in Argentia over the next two years at a scale of 1-to-100. The demo plant will be ready for start-up in mid-2006 and operate for two years, providing design criteria for a final commercial plant, while demonstrating product quality.
“It’s quite an extensive and expensive program, but we would rather stay on the leading edge of technology than fall over on to the bleeding edge of technology,” du Toit told delegates at the annual conference of the Newfoundland branch of the Canadian Institute of Mining, Metallurgy and Petroleum, held recently in St. John’s. “It’s a prudent and conservative approach [designed] to eliminate the risk for the full-scale commercial product.”
A bankable feasibility study completed in January 2003 by SNC Lavalin shows a rate of return in excess of 15% based on an overall investment of $2.3 billion, using metal prices of US$3 per lb. nickel, US90 per lb. copper, and US$7 per lb. cobalt, a Canadian-US dollar exchange rate of US66, and a fuel oil price of US$26.80 per barrel.
Given the mineral resources already identified and the expectation that additional resources will be found, the life of Voisey’s Bay is expected to be significantly longer than the 14 years envisaged for phase one. Most of the remaining resource is contained at depth in the Eastern Deeps zone and the Western extension, which includes the Discovery Hill and Reid Brook zones. At the end of 2002, the indicated portion of this resource was reduced by some 40 million tonnes from the 2001 estimate after changes were made to the applicable cutoff grades, based on new mine plans. Indicated resources are estimated at 54 million tonnes grading 1.53% nickel, 0.7% copper and 0.09% cobalt. An additional 16 million tonnes grading 1.6% nickel, 0.8% copper and 0.1% cobalt are inferred.
In August, 2003, to assess the future development and economic potential of the underground resources, Inco launched a 3-year program of surface exploration. Crews will carry out 16,000 metres of drilling, perform borehole geophysics and metallurgical testing, and collect geotechnical and environmental data. “Our exploration program is focused on delineation drilling and better definition of the other potential resources, rather than greenfields exploration,” said du Toit. Positive prefeasibility studies will lead to the planning of an underground exploration program to define resources for development.
Labrador
Meanwhile,
In April, a 2,200-line-km geophysical survey was flown over the eastern half of the project using the deep-penetrating MegaTEM system. Ground geophysical surveys identified three target areas for drilling in early September. The targets are on the North Gabbro, in the general area where the highest grades and nickel tenors have been intersected on the South Voisey Bay project. The targets have coinciding residual east-west-oriented gravity and magnetic features. Two of the target areas are on the Sarah Lake property, held by Donner and
Three holes totalling 1,275 metres were drilled, and the geophysical conductors were explained by poorly mineralized sulphide intercepts. The best hole cut a 0.23-metre-wide intercept grading 1.22% nickel, 0.31% copper and 0.17% cobalt at the base of a 125-metre-thick gabbro unit on the Donner-Northern Abitibi ground.
Farther to the north,
Newfoundland
On the island, there have been about 6,400 new claims staked to date, and most of these are in the central Botwood Basin and Bay d’Espoir areas. “Pretty well all your prospective areas on the island are heavily staked,” says Ken Andrews. “Exploration is taking place right across the whole island.” Also garnering attention are industrial minerals, including salt, garnet, limestone, marble and dimension stone.
St. John’s-based Altius Minerals remains one of the most active juniors in the province, with a large, diversified portfolio of some 40 projects. In the Botwood Basin, Altius is exploring a high-grade, low-sulphidation epithermal gold system on the Moosehead joint venture with
Altius recently drilled two deep holes at its wholly optioned, former-producing Rambler mine property, near Baie Verte. The first hole, drilled to a depth of 1,257 metres, was designed to test the down-plunge extension of the Ming deposit. The hole intersected VMS-style stringer pyrite mineralization that ran 0.5% copper, 0.28% zinc, 1.2 grams gold and 6.9 grams silver across 17.6 metres (including 6.4 metres of 0.75% copper and 2.1 grams gold) at a down-hole depth of 1,131 metres.
Using directional drilling techniques, a second hole was offset from the initial hole to test a broad, off-hole geophysical conductor along the same mineralized horizon. A 4.1-metre-long intercept of 3% copper, 1.2% zinc, 2.8 grams gold and 25.7 grams silver was intersected by hole 2 at a down-hole depth of 1,138 metres, some 54 metres along strike of the first intercept and 440 metres down-dip from the past-producing Ming mine, which ceased production in a full face of ore at a former property boundary. The Ming deposit reportedly produced 1.9 million tonnes of ore grading 3.5% copper, 1% zinc, 2.4 grams gold, and 20.6 gram silver.
During the summer, Altius completed the purchase of a 7.5% interest in a newly formed limited partnership with Archean Resources, the private company that originally made the Voisey’s Bay discovery on behalf of Robert Friedland’s Diamond Fields Resources. Archean holds a 3% net smelter return royalty (NSR) in the Voisey’s Bay project, which it has contributed to the newly created Labrador Nickel Royalty Limited Partnership. Altius paid $9.7 million and issued 750,000 Altius share purchase warrants for the initial 7.5% stake, with an escalating 3.5-year option to increase its position to 10%.
Rubicon
Rubicon Minerals is focused chiefly on gold exploration on the island. The company is a well-seasoned junior with interests in several district-size projects totalling more than 2,000 sq. km. “We’re here because we recognize Newfoundland’s vast untapped gold potential and we appreciate that Newfoundland welcomes mining,” says Paul Moore, Rubicon’s exploration manager. Since coming to the island in the fall of 2001, Rubicon has spent about $4 million on grassroots work. “For that, we have many new discoveries, and all of them were made by basic prospecting,” says Moore. “We see Newfoundland as a greenfields opportunity with district-scale potential.”
Rubicon made one of the more significant developments in the province last year with the grassroots discovery of the Golden Promise prospect, which was recently optioned to Placer Dome.
The junior conducted a small, 1,000-metre drill program over a year ago to test the source of a 2-km-long train of large gold-bearing boulders discovered in May 2002 by local prospector William Mercer. Grab samples from the boulders had yielded bonanza-grade values of up to 353 grams. The discovery was made in an area with no record of any staking or previous exploration work. The discovery area is outside the Botwood Basin in the north-central part of the province, 15 km southeast of the town of Badger.
Rubicon drilled 21 holes into a 225-metre strike length on one portion of the Jaclyn zone vein target to a vertical depth of only 50 metres. Of the 17 holes that intersected the vein zone, 15 contained visible gold. An additional three holes were lost as a result of technical difficulties, and a fourth hole was not drilled deep enough to reach its intended target. Selected highlights from the drilling included 69 grams over a core length of 0.4 metre (estimated true width: 0.21 metre), 11.4 grams over 2.2 metres (true width: 1.8 metres), 16.6 grams over 2.5 metres (true width: 1.6 metres), 7.05 grams over 4.9 metres (true width: 2.2 metres), 17.7 grams over 2.3 metres (true width: 0.94 metre), and 31.6 grams over 0.5 metre (true width: 0.34 metre).
It’s a high-grade, sub-vertical quartz-vein system that ranges from 2.7 metres for an integral vein to a zone of up to 4 metres in width. It remains open for follow-up in all directions.
Placer can earn an initial 55% interest in the 550-sq.-km project by spending $5 million over four years, including $700,000 before the end of February 2004. Rubicon will remain the operator of the project until earn-in is completed. By delivering a bankable feasibility study before the end of 2009, Placer can boost its interest to 70%.
Prospecting in 2002 and this year has led to the discovery of additional visible gold-bearing mineralized boulders believed to have been sourced from other veins. Rubicon has found six distinct areas of mineralized quartz vein float, including the Jaclyn discovery area, over a 16-km-long trend. Down-ice of Jaclyn to the northeast, float material has been found containing up to 356 grams gold. More than 8 km away, a bedrock showing delivered a 56-gram grab sample. In the southwest, up-ice from Jaclyn, Rubicon uncovered gold-bearing float returning up to 35 grams gold.
Rubicon has kicked-off an exploration program on the Golden Promise project this fall and plans to drill 2,500 metres. The entire project area is being flown with airborne geophysics, and a mechanized trenching program is under way.
A separate package of claim blocks, situated 15-100 km along trend to the southwest of the Jaclyn discovery, was optioned by Rubicon to
New World
On the north shore of Newfoundland, Rubicon controls all of the New World project, centred on a 30-km-long structural corridor along which 10 new visible gold occurrences have been found. Of the 1,017 grab samples collected during regional prospecting in 2002, more than 25% ran better than 0.5 gram gold. During 2003, Rubicon carried out an aggressive program of channel sampling on the coastal project, taking roughly 600 samples. High-grade results include: 18.1 grams over 2.3 metres and 50.2 grams across 1.1 metres at the Big Island prospect; 87 grams over 0.8 metre at Big Oz; 10.7 grams over 1.4 metres and 13.2 gram across 1.1 metres at Little Island; 44.3 grams over 0.5 metre at Location; 49 grams across 0.3 metre and 18.8 grams over 0.3 metre at the Gina showing; and 7.3 grams across 2 metres and 5.9 grams over 5.8 metres in the Dunnage-Coaker area.
The gold mineralization is associated with quartz-carbonate veining and alteration in porphyry intrusions, volcanics and sediments. “We are just getting our feet wet at New World, but so far results have been encouraging,” says Moore. “This is probably our next Golden Promise in waiting, the difference is really a couple of drill holes.”
West of Gander, in the central part of the province, Rubicon holds 2,500 claims in the Glenwood Break area, of which 1,595 are under option to International Lima. Prospecting to date has found gold mineralization along several linear structures, including the wholly controlled Joe Batt’s Pond, which covers a 19-by-3-km northeast trend. Nineteen of 53 samples of mineralized quartz vein float assayed greater than 3 grams (with values as high as 159 grams) in boulders of up to 1 metre. Seven sample sites contained visible gold. A 9.5-km-long gold-bearing trend has been defined by the float and panned gold in stream sediments. “We have also found some pretty good numbers on the Lima ground,” says Moore.
Cornerstone Capital
Mount Pearl-based Cornerstone Capital Resources is another home-grown success story, with its joint-venture partners slated to spend $1.3 million in exploration this year. Cornerstone’s portfolio includes more than a dozen gold properties, two extensive sedimentary red-bed copper packages, the Noel Paul’s Brook VMS prospect (optioned to Inmet), and recently acquired claim packages covering prospective platinum group elements and Olympic Dam-style copper-gold mineralization in Labrador. The company has eight joint-venture agreements now in place.
During 2003,
Cornerstone farmed-out interests in both the Cape Roy property in the southwestern part of the island and the Green Bay property, 5 km from the Hammerdown gold mine, to
In October, Sudbury Contact Mines began a 1,450-metre drilling program on the Colchester project in the Green Bay mining district of western Notre Dame Bay. Work to date has outlined a corridor of intermittent VMS-style mineralization and alteration that is 3.5 km long. Recent trenching returned up to 5.9 grams gold, 30.7 grams silver, 2.05% copper and 1.18% zinc over 3 metres from channel samples. The drilling was planned to test five target areas with 14 shallow holes, including the twinning of several holes drilled in the late 1960s — holes that were never analyzed for gold. Core from the historic drilling has been lost, but grades of up to 2.48% copper over 12.5 metres and 1.25% copper over 49.1 metres were reported.
Cornerstone is the operator of the Colchester joint venture until such time that Sudbury Contact completes its earn-in for a 51% interest by spending $1.2 million in exploration and making $210,000 in option payments over four years.
Gold porphyry
The Reid property is in the Botwood Basin on the Northwest Gander River in central Newfoundland. It is contiguous with claims held by Altius and Rubicon on the southern portion of the Mustang trend. The property hosts a gold-mineralized porphyry body in the Coy Pond ultramafic complex. “Little work has been done in this area, so we’re sort of breaking new ground,” says Peter Dimmell, Linear’s vice-president of exploration for Canada.
Linear originally optioned a 100% interest in the property in September 2002, based on the discovery by Cyril Reid of mineralized boulders that ran up to 4 grams gold. The boulders were found north of the river in small brooks and subsequently as float scattered through the bogs and open forests in an area 400 metres long by 600 metres across. “What interested us the most about this property was that these boulders are quartz porphyries,” explains Dimmell. “They were carrying gold up to three to four grams.”
Linear initially cut a 33-line-km grid, utilizing a 5-km-long baseline, to cover the area. Ground geophysical surveys were done in conjunction with soil sampling and prospecting. Five trenches were dug using an excavator to test anomalous gold and arsenic soils. Outcrop was exposed in only two of the trenches. An altered, 2.3-metre-wide mineralized zone in trench 1 returned 2.1 grams gold.
A porphyry target was defined by a coincident magnetic low, a gold and arsenic soil anomaly, and high-chargeability and resisitivity induced-polarization (IP) values.
In early 2003, Linear completed a short, 6-hole program over a 200-by-125-metre area that intersected thick, significantly mineralized quartz porphyry in four of the holes. The two other holes cut only narrow quartz porphyry dykes in mainly altered mafic volcanics. Says Dimmell: “It’s a coarse porphyry, very silicified and strongly altered, with lots of veining and sulphides — disseminated arsenopyrite and pyrite.”
The best sections included: 21.5 metres grading 1.1 grams gold per tonne in hole 2 starting at 81 metres down-hole; 20 metres of 1.6 grams (including 2.2 grams across 10.6 metres) in hole 3 beginning at 79 metres down-hole; and 41.4 metres of 1.1 grams in hole 6 starting at 51 metres down-hole.
“Meridian Gold is now our partner,” Dimmell says. “It’s their first exploration project in Canada. Their first option deal is here in Newfoundland. I think that says something about the potential they see in this particular property.”
Since doing the deal with Meridian, Linear has been conducting further prospecting and stream-sediment geochemistry. The property is being flown with airborne geophysics, followed by IP over an expanded grid. A winter diamond drilling program spanning 2,500 metres is planned for early 2004.
Be the first to comment on "Discoveries lure Placer Dome, Meridian Gold to Newfoundland"