Peregrine’s Chidliak delivers the goods (December 06, 2010)

Highly anticipated mini-bulk sample results from Peregrine Diamonds’ (PGD-T) Baffin Island Chidliak diamond project didn’t disappoint.

The CH-7 mini-bulk sample shows a grade of 1-carat-per-tonne and a population of gem-quality diamonds, 15 of which are over 0.5 carat in weight and include 6.53, 2.18 and 1.24-carat stones.

“We have now shown that CH-7 has a healthy population of large diamonds with three diamonds over a carat in size in only a 47- tonne sample,” Brooke Clements, president of Peregrine, told The Northern Miner. “This is very good news for CH-7 and for the project.

“Typically, the majority of a diamond mine’s value comes from the large stones. We are confident that a larger bulk sample from this kimberlite will deliver even larger diamonds,” he said.

The highly promising land-based CH-7 kimberlite pipe has an estimated surface expression of 1 hectare. It is one of 50 new kimberlites Peregrine has discovered in the last couple of years on the 9,800-sq.-km Chidliak project, 120 km northeast of Iqaluit.

The project is held 51% by BHP Billiton (BHP-N, BLT-L) and the rest by Peregrine. This year’s $15.3-million exploration program was funded entirely by BHP as part of its earn-in requirement. BHP has a one-time option to earn an extra 7% should it choose to fund the project to completion of a bankable feasibility study. BHP has until the end of November to decide.

Adding to the kimberlite count at Chidliak was only one of Peregrine’s objectives during this year’s exploration program. During the summer, Peregrine took mini-bulk samples from two promising kimberlites discovered in 2009; a 47.2- tonne sample from CH-7 and a 14- tonne drill sample from CH-6.

A 47.2-tonne sample of surface material collected from CH-7 returned a 49.07-carat parcel of commercial- size diamonds larger than a 0.85-mm sieve size cutoff, for a diamond grade of 1.04 carats per tonne.

Of the 15 diamonds 0.5 carat and larger, one is white or colourless, three are off-white, five are grey and three are brown in colour. Ten of the diamonds are described as octahedrons, three are distorted crystals and two are aggregates.

The four largest diamonds are a 6.53-carat grey, translucent distorted crystal, a 2.18-carat white or colourless, transparent octahedron, a 1.24-carat off-white, transparent aggregate and a 0.98-carat off-white, transparent octahedroid.

The mini-bulk sample results compare favourably with previous microdiamond results, which showed an encouraging coarse diamond size distribution. The outcropping CH-7 kimberlite was discovered 2 km southwest of CH-1 while investigating an airborne magnetic anomaly in the summer of 2009. A 221-kg sample of surface material collected by hand returned an impressive 664 stones, including a 0.64-carat, off-white diamond.

The 47.2-tonne mini-bulk sample of CH-7 was collected from a 2-metre-deep trench on an outcropping 3.5-by-4.5-metre portion of the pipe’s north lobe. The sample consisted entirely of magmatic kimberlite containing abundant indicator minerals and mantle xenoliths.

In an effort to assess its size potential, Peregrine put six core holes and two reverse circulation (RC) holes into the pipe. Two angled holes across the southern end intersected true horizontal widths of 88 and 95 metres. Interpretation of the drill hole data suggests the CH-7 kimberlite is a multi-phase pipe measuring 1 hectare at surface. It contains a distinct north lobe and a south lobe.

The north lobe appears to comprise a single phase of coarse-grained olivine macrocrystic magmatic kimberlite, with abundant indicator minerals and mantle xenoliths. The south lobe is not exposed at surface and consists of volcaniclastic kimberlite, with Paleozoic rock fragments plus abundant indicator minerals and mantle xenoliths.

Results from the 14-tonne mini-bulk sample of CH-6 are pending. Hopes are especially high for CH-6, which delivered spectacular microdiamond results last year that prompted comparisons to the early days of the Ekati and Diavik diamond discoveries.

CH-6 was discovered under 16 metres of overburden by drilling a magnetic low anomaly. A 569-kg sample of drill core returned a staggering 4,737 diamonds, including a 4.58-carat parcel comprised of 63 commercial-size stones larger than 0.85 mm. The largest diamond was a 0.62-carat white, transparent aggregate.

Based on the release of a new batch of microdiamond results, another new kimberlite discovery, CH-44, demonstrates tremendous potential. The latest results show the CH-44 kimberlite has a very promising coarse diamond size distribution. CH-44 is one of 34 new kimberlites Peregrine discovered this year at Chidliak.

Among the 910 microdiamonds recovered from a 312.2-kg sample of RC drill cuttings taken from CH- 44, were nine commercial-size diamonds that exceeded a 0.85-mm screen size and weighed a total of 0.45 carat. The implied diamond content of the sample is 1.44 carats per tonne.

The parcel included a 0.32-carat diamond, described as an off-white, transparent octahedron. Of the eight remaining larger size diamonds, two were white or colourless, four were off-white and two were brown.

“We are very encouraged by these results from CH-44, yet another kimberlite at Chidliak with a strong coarse diamond size distribution and economic potential in Arctic settings,” said Clements.

“The CH-44 pipe is located in what we now refer to as the Southern Focus area, an area with an 8-km radius that currently hosts five kimberlites with economic potential: CH-1, CH-6, CH-7, CH-31 and CH-44,” explained Clements. A sixth promising kimberlite, CH-28, occurs in the north half of the project.

CH-44 was discovered by drilling a single hole into a magnetic high geophysical anomaly, 1 km west of the 5-hectare CH-31 pipe and 2.5 km south of CH-7. A vertically-drilled RC hole intersected kimberlite from 2 to 35 metres depth before shutting down while still in kimberlite.

The magnetic geophysical anomaly of CH-44 has a surface expression of 0.9 hectare. The kimberlite is described as an olive macrocrystic unit containing abundant indicator minerals, including garnet chrome diopside and ilmenite. Paleozoic rock fragments and basement xenoliths were observed in the drill cuttings.

“This kimberlite clearly requires more work in 2011, including core drilling and mini-bulk sampling,” Clements stated.

With 50 kimberlites discovered to date, the Chidliak kimberlite camp extends 70 km in a north-south direction and 40 km east-west. Peregrine also discovered two diamondiferous kimberlites, Q1 and Q2, on its adjacent 100%- owned Qilaq property, further expanding the potential of the region.

In addition to CH-44, newly released microdiamond results for CH-19, CH-21, CH-23, CH-35 and CH-38 show all five kimberlites are diamond-bearing, but with much lower counts.

Results are as follows: a 188.5-kg sample of CH-19 held just a single microdiamond; 13 micros were recovered from 192.8 kg of sample from CH-21; CH-23 yielded seven stones from a 267.2-kg sample; a 239.3-kg sample collected from CH-35 returned eight microdiamonds; and CH-38 delivered 51 diamonds under a 0.425-mm sieve size from 188.6 kg of sample.

Kimberlites CH-19, CH-21, CH-23 and CH-35 were all found by prospecting while investigating prospective geophysical anomalies. In all cases, abundant kimberlite boulders and cobbles were discovered at surface associated with the airborne features.

The CH-38 kimberlite was discovered by drilling a 1-hectare magnetic high anomaly. Two crosscutting holes positioned on each side of the anomaly intersected roughly 100 metres of kimberlite.

Microdiamond results have been reported for 24 of the 50 kimberlites discovered to date, with 23 being diamond-bearing. Results for the remaining kimberlites discovered in 2010 are expected by year-end.

“We hope to add to this growing list of potentially economic kimberlites as more microdiamond results f
rom the 34 kimberlites discovered this year are received,” stated Eric Friedland, Peregrine’s chief executive officer.