Northern initiative generates targets for Diamonds North

Diamonds North Resources (DDN-V) has staked more than 1,200 sq. km of new mineral claims 100 km south of Baker Lake in Nunavut, following the recovery of kimberlite indicator mineral grains from multiple till samples. The samples were collected as part of a reconnaissance exploration program.

The claims constitute the Tasiq project and are, in turn, enclosed by a large property block held by De Beers Canada. The major’s land package is more than several hundred kilometres west of the Churchill area play where, in the past two years, 35 new kimberlites have been found (though they have so far turned out to be barren or weakly diamondiferous).

In early February 2004, the Nunavut mining recorder issued prospecting permits to De Beers. The permits apply to more than 28 million acres (113,535 sq. km) across the eastern region of Canada’s Far North. In the Tasiq area, De Beers acquired permits near two claims held by Phelps Dodge (PD-N). Mark Kolebaba, president of Diamonds North, says permitting restraints forced De Beers to leave open a big doughnut hole, or gap, measuring roughly 50 by 30 km around the Phelps Dodge claims. “You can’t permit up to claims,” Kolebaba explains. “You have to stay a-quarter-map-sheet away. We knew they didn’t leave it because they wanted to leave it; they left it because of the permitting process.”

Diamonds North went in this summer and “densely” sampled the block. Some of the indicator minerals that resulted had kimberlite still attached to the grains. In addition, several mineral grains exhibit primary kelyphitic and sub-kelyphitic textures, suggesting they have not travelled far from their source. Some of the samples contained counts of up to 70 mineral grains. “We have cut off the parent,” Kolebaba says confidently.

The Tasiq project area is about 175 km west of the Parker Lake property, which was explored for diamonds in the mid-1990s by Cumberland Resources (CLG-T) and Comaplex Minerals (CMF-T). In the summer of 1993, regional mapping by the Geological Survey of Canada uncovered at least two highly diamondiferous alkaline lamprophyre dykes on the Parker Lake property, 120 km northwest of Rankin Inlet, about halfway to Baker Lake. An initial, 22-kg surface sample from the Akluilak (or Thirsty Lake) prospect yielded 1,513 microdiamond crystals, including two stones exceeding 0.5 mm in one dimension. A 32.8-kg check sample confirmed the find, returning a total of 1,163 stones, including six larger stones greater than 0.5 mm in one direction.

The Akluilak dyke is quite narrow, ranging from 0.3 to 1.5 metres wide, and is described as an ultrapotassic lamprophyre, or minette. The dyke is Proterozoic in age, and, at 1.84 billion years old, kin to the Christopher Island volcanics, a huge suite of ultrapotassic rocks.

With Cumberland’s permission, De Beers processed a 7.8-kg sample from the dyke in 1995 and retrieved 6,680 microdiamonds, including 3,972 microcrystals under 0.074 mm in size. Three stones measured more than 0.5 mm in one dimension. The results prompted De Beers to take a much larger, 1-tonne sample to check for commercial-size stones.

The dyke is unusual, considering the large amount of diamond microcrystals. As well, it is said to be the only known occurrence of minette containing the diamond indicator minerals chromium-pyrope, chromium-diopside, picroilmenite and magnesium olivine.

The Akluilak dyke was considered uneconomic because of its limited size potential and the poor quality of its diamonds. A lot of the diamonds had a poor shape; they had been re-absorbed and burnt.

Cumberland identified several other similar diamond-bearing dykes and conducted extensive heavy-mineral sampling across the Parker Lake property in 1996, recovering more than 460 samples before losing interest in the area’s diamond potential.

Last year, Diamonds North’s exploration initiatives resulted in the staking of the 1,690-sq.-km Amaruk project, on the mainland across from the Melville Peninsula, about 45 km south of Kugaaruk. Regional heavy-mineral sampling had revealed multiple anomalous areas. One sample alone contained an impressive 1,350 kimberlite indicator mineral grains, including peridotitic and eclogitic garnets, chromite, chrome diopsides and ilmenite.

Diamonds North merged its Amaruk project with the Pelly Bay area holdings of BHP Billiton (BHP-N) to create a 50-50 joint venture covering an area in excess of 32,380 sq. km around the town of Kugaaruk. Under the arrangement, BHP Billiton is the project operator and can earn an extra 10% interest by incurring all exploration costs up to the completion of a feasibility study within seven years’ time. BHP would have the right to earn an ultimate 65% stake in the project by arranging all financing to production.

This past summer, an 11,000-line-km magnetic and electromagnetic airborne geophysical survey was flown over the central part of the project and 3,205 till samples were systematically collected across the entire project area as part of a $5-million program. The samples were collected anywhere from a 4-by-5-km grid down to a 1-by-2-km grid using a 10-man crew that was in the field for 60 days. During a brief, 2-day visit to the project by Kolebaba in early September, kimberlite boulders and fragments were found in three separate areas. At one area, boulders of kimberlite were found at five discrete sites, forming a 2.3-km-long corridor on trend with the 2003 till sample that returned 1,350 indicator mineral grains.

However, a 287-kg sample of the boulders contained just seven small microdiamonds no bigger than a 0.212-mm sieve-size classification. “They certainly are not screamers, but this shows that there are diamonds in the area,” says Kolebaba. “Now we are getting indicator mineral samples back, and they suggest that there are quite a few multiple dispersions. Some of them have good, high-quality indicators, and some do not.”

To date, grains from 200 samples have been microprobed. Several high-chrome, sub-calcic G10s have been recovered. “It’s as good as what you would see at Ekati or Diavik,” says Kolebaba, who anticipates BHP will be drilling on the project by March.

Diamonds North also joined forces with Kennecott, part of Rio Tinto (rtp-n), to explore the Arnak project, immediately south of the Amaruk joint venture. The Arnak project is 150 km south of Kugaaruk and covers 3,870 sq. km held 74% by Kennecott and 26% by Diamonds North. Under terms of the agreement, Kennecott must solely fund the first $5.5 million in exploration costs over the next four years or its entire interest reverts to a 1% royalty on 2,500 sq. km of permits.

Kennecott completed 20,000 line km of airborne magnetic surveys over the project and collected 223 heavy-mineral samples during the summer. New anomalies are being generated.

This year, Diamonds North budgeted $2 million to develop new projects under its northern reconnaissance initiative. In May, the company optioned three mineral licences in northern Manitoba from privately held Indicator Explorations and picked up another five licences, resulting in a combined land position of 3,530 sq. km. A proposed program of heavy mineral sampling was cut short this summer after encountering difficult overburden; instead, a fixed-wing horizontal gradient magnetic survey covering 14,950 line km was flown.

Manitoba has proved a tough go for diamond exploration. Both majors and juniors alike have been drawn to the province in the past by heavy mineral sampling results that reveal promising kimberlite indicator mineral chemistry. All efforts to date have been thwarted by a complex glacial history.