Newfoundland exploration bolstered by majors

The number of majors active in the province has increased over the past several years, and so too have the number of mining claims staked and in good standing.

The province’s leading players like Noranda Exploration and BP Resources have now been joined by a host of other industry heavyweights including Corona Corp. (TSE), Inco Gold, Teck Corp. (TSE), Rio Algom (TSE), Placer Dome (TSE) and Westminer Canada, to mention a few.

Most of those senior companies have set up regional offices in Newfoundland and are in the midst of consolidating their land positions or launching substantial grassroots exploration programs.

The provincial mines department reports a steady flow of companies coming through its offices to examine geoscience database and assessment file records.

Last year was one of the busiest ever for mineral exploration in Newfoundland, says government spokesman Norman Mercer. He reports “healthy levels” of exploration activity in the province again this summer, although the junior sector is not as busy as previously.

Standard indicators such as the number of new claims staked are around 12,000, while total claims in good standing total about 70,000, still a record high.

Nearly $40 million in exploration dollars went into the province in 1988. Mercer optimistically predicts spending could be around $35 million to $40 million this year, depending on how much drilling is done in the fall season.

“Unless there’s a lot of activity between now and the end of the year, that figure could be a little too high.” says Noranda’s regional exploration manager Dan MacInnis.

Noranda will spend about $8 to $10 million on Newfoundland exploration this year, Maclnnis says, making it the leading player in the province. The company currently has drills turning on its Baie Verte area properties under option to Muscocho Explorations (TSE) and another at work at its Tally Pond base metal property near Buchans.

Because a number of junior companies are still waiting to secure funding for their Newfoundland properties, some drill programs involving juniors could be delayed until the fall.

“September and October could be quite hectic as far as drilling is concerned,” says MacInnis.

A drilling program is also planned by Noranda later this fall at the Stoger Tight gold property on the Baie Verte Peninsula. The company’s partner on that project is International Impala Resources (VSE).

“A number of projects are still awaiting funding, while several others are in a holding stage”, says Corona’s regional geologist Peter Dimmell.

Drilling is currently under way on Corona’s Mings Bight property held under option from Varna Gold (ASE). That drilling program is designed to test the continuity of complex gold-bearing quartz vein systems discovered on the property last year.

Elsewhere in northern Newfoundland, Noranda Exploration is gearing up for a drill program on the Rendall-Jackman gold property under option to Vancouver-based Major General Resources, a private company expected to go public soon.

Noront Resources (VSE) reports that a preliminary budget of $1 million has been set for the Grubline joint venture project with Noranda. Situated in the Gander area of Newfoundland, the Grubline project covers about 850,000 acres. Work to date has resulted in the discovery in bedrock of one significant antimony zone (a pathfinder for gold) and two new gold zones.

According to Noront, the antimony zone occurs as massive veins of stibnite (antimony sulphide) up to 9.8 ft wide. Grab samples have returned assays ranging from 14.7%-22.7% antimony.

Work on the two new gold zones is still preliminary but grab samples on the first discovery have yielded values of 0.14 oz to 0.88 oz gold per ton. Stripping and channel sampling is in progress. On the second discovery, initial channel samples assayed 0.34 oz gold across 8.5 ft.

Bitech Corp. (ASE) is nearly finished a major drilling program on its Nugget Pond property at Betts Cove, and will report final results of that work in the near future. Partner Equity Silver Mines (TSE) recently modified the terms of its joint venture agreement with Bitech.

Later this month, all proposals will have been received by the Newfoundland government for exploration of 434 hectares of exempt mineral lands in the Rambler Mines area of the Baie Verte Peninsula. Proposals to explore the claims will be accepted by the government until Aug 15.

Last year, Petromet Resources (TSE) and Newfoundland Exploration (TSE) carried out a $3.8-million program on the former Rambler property. Teck has an option to carry forward work on that property and could decide by November this year.

In the central part of the province, exploration for gold and base metals continues at a steady pace, with the leading project — Duck Pond/Tally — held by partners Noranda Exploration and BP Resources Canada (TSE).

Geologist Colin MacKenzie, at BP’s exploration office in Corner Brook, says his company has two drill rigs turning on part of the large Victoria Lake mineral concession in central Newfoundland.

The company is spending roughly equal amounts on the search for gold and base metals there.

As one of the biggest and most promising tracts of land in the province, BP’s Victoria Lake holdings surround the past-producing Buchans deposit, and include the Duck Pond polymetallic deposit, which was drilled off by No randa last year.

BP’s Victoria Lake holdings comprise about 500,000 hectares. The potential for future discovery of both base and precious metal deposits is believed to be high.

“The concession is a huge piece of ground and we believe the mineral potential is excellent,” said MacKenzie. “We’re committed to maintaining a good level of exploration expenditures over the long term.”

While declining to give out specific figures, he confirmed that BP’s expenditures on the large concession have increased this year, up from previous levels. Although the company has worked with juniors in the past, it is exploring the concession on its own this year.

The former Buchans mine produced some 16 million tonnes of high grade base metal ore before it ceased production in 1984. Buchans ore averaged around 15.5% zinc, 7.8% lead and 1.45% copper, with additional gold and silver values.

Geological reserves for the Duck Pond/Tally Pond deposit, in which BP has a 40% interest, stand at four million tonnes grading 3.5% copper, 6.6% zinc, 1.1% lead, 67.4 g silver and 1.0 g gold per tonne. Noranda says it will do a small drill program at Tally Pond this year.

In southwestern Newfoundland, Corona-controlled Dolphin Exploration (TSE) is moving full speed ahead on its Cape Ray gold project where a production decision could be made later this year, following completion of the current $4 million exploration program and feasibility study.

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