Majescor raises funds to explore in Quebec

With diamond fever gripping Quebec, Majescor Resources (MAJ-V) has raised $900,000 from two private placements brokered by Dundee Securities.

The private placements grossed $500,000 from the sale of 833,000 flow-through units, and $400,000 from the sale of 500,000 non-flow-through units. Priced at 60, each flow-through unit consists of one share and a half-warrant. One full warrant entitles the holder to buy an additional share at 78 for 18 months. The 60 deal was announced in mid-December 2001, on the same day Ashton Mining of Canada (aca-t) confirmed that its two Renard kimberlitic discoveries in the Otish Mountains area of north-central Quebec were diamond-bearing. Majescor holds a portfolio of properties in the Otish Mountains, including the Portage property, which is down-ice from Ashton and under option to BHP Diamonds, a division of BHP Billiton. The junior has also farmed out ground to Canabrava Diamond (CNB-V) and Iriana Resources (IR-T).

The non-flow-through unit financing, priced at 80 apiece, was announced in late December and comprises one share and half a warrant. A whole warrant can buy a further share at $1 for 18 months.

Majescor is currently trading at around $1.35, having recently come off a 52-week high of $1.64. With the close of the recent financing, the company has close to $4 million in working capital and 19.7 million shares outstanding, or 25.4 million fully diluted.

Majescor is preparing to begin winter exploration at its Wemindji property in northern Quebec, where it is trying to track down the source of a strong concentration of kimberlite indicator minerals and hypabyssal kimberlite fragments. Wemindji is 40 km east of James Bay and some 100 km southwest of Radisson. It covers 878 sq. km of ground centring on a former project of the Canadian exploration division of De Beers.

The De Beers subsidiary had traced a 30-km-long train of indicator minerals but drill-tested nine magnetic anomalies without success. De Beers walked away from the area in mid-1999 after at least three years of work that included moderate-to-high-density till sampling, high-resolution airborne geophysical surveying and follow-up drilling.

Majescor initially carried out a 1,685-line-km helicopter-borne geophysical survey over anomalous indicator mineral areas and followed up with heavy mineral sampling and ground geophysics over some of the better magnetic targets. One such anomaly coincided with a glacial-sediment sample site that yielded numerous fragments of kimberlite and more than 9,000 indicator grains.

The kimberlitic indicator population of the Wemindji area as a whole is dominated by ilmenite, followed by G9, G10 and megacryst garnet. Olivine, chromite and chrome diopside are scarce.

Majescor drilled six shallow holes during the fall without success. The holes all encountered granite. Kimberlite fragments recovered from trenching in the fall have undergone petrographic analysis, which indicate the kimberlite is not magnetic. The junior is carrying out additional ground electromagnetic and gravity surveys in preparation for drill-testing, in February, of up to 15 targets.