SouthernEra sees potential at Sue

Encouraged by the microdiamond results from this past year’s drilling on the Sue kimberlite pipe at the Yamba Lake project in the Northwest Territories, SouthernEra Resources (SUF-T) will test about a tonne of the remaining drill core to determine its potential for large diamonds.

SouthernEra re-tested the Sue pipe with four new holes and redrilled the Sputnik kimberlite pipe with one hole. In addition, two geophysical airborne targets were drilled, producing negative results.

The Yamba Lake project is 40 km north of the Ekati diamond mine.

The Sue and Sputnik kimberlites, along with the Torrie pipe, were discovered in 1993. Since optioning the project in 1999, SouthernEra has systematically re-tested many of the original kimberlite discoveries, while exploring for new targets. With the exception of the Torrie pipe, the six other known kimberlites have seen only a limited amount of work. SouthernEra can earn 60% of Yamba Lake by completing a bankable feasibility study before the end of 2006, at which point Tanqueray Resources (tqy-v) and Mill City International (mit-v) would each be left with a 16% stake. Techsite Strategies (tss-v) would hold the remaining 8%. SouthernEra can tack on another 5% by arranging project financing on behalf of all parties.

The original discovery hole at Sue intersected 120 metres of kimberlite starting at a down-hole depth of 29 metres. A 97.2-kg test sample returned 12 microdiamonds and two macros. (A macro is here defined as measuring greater than 0.5 mm in at least one dimension.)

During the spring, SouthernEra initially redrilled Sue with a hole angled at 45; it intersected 172 metres of kimberlite rock before shutting down while still in kimberlite. A 226.7-kg test sample from the hole returned 77 micros and 18 macros, including 12 stones greater than 0.5 mm in two dimensions. The largest stone measured 1.44 by 1.1 by 1.04 mm. Within the sample, a 71.35-kg portion yielded 52 micros and 17 macros, indicating a potentially higher-grade phase.

Describing the results as “encouraging,” SouthernEra drilled three more holes into Sue this past summer. An additional 490.18 kg of sampled kimberlite from the three holes yielded 104 micros and 15 macros, including 10 stones greater than 0.5 mm in two dimensions and four diamonds exceeding 1 mm in two directions. The largest stone recovered weighed 0.048 carat and measuring 2.6 by 1.94 by 1.68 mm.

SouthernEra says most of the recovered macros are “of a good white colour and excellent quality.”

In August, SouthernEra redrilled Sputnik with one hole, recovering 36 micros from 195.92 kg of tested material. The Sputnik kimberlite body was originally tested in 1993. An initial test sample of 23.3 kg contained three micros and one macro. Further drilling in 1994 returned three micros and one macro from 33.6 kg of sample, while another 154.2 kg proved barren.

In light of the results to date, SouthernEra plans to continue evaluating the known Yamba Lake kimberlites. A program to test stored drill core recovered from the Eddie and T-10 kimberlites is in the works, while follow-up ground geophysical surveys are planned for the Torrie, Sue and Sputnik area.

Under the option arrangement, SouthernEra is required to spend at least $300,000 a year on exploration.