Voisey’s Bay potential tied to Eastern Deeps

Reserves at Voisey’s Bay continue to grow as fast as speculation about an imminent takeover of the project’s majority owner, Diamond Fields Resources (TSE).

Drills are still turning on the main ovoid zone, but it is the much deeper (and potentially larger) area of mineralization known as the Eastern Deeps that is attracting most of the attention. The latest assay results from the zone range up to 3.36% nickel, 1.41% copper and 0.17% cobalt over 39.9 metres.

Assays are in for the three latest holes to be completed on the Eastern Deeps (see table on page 2). Since these holes have been completed, work has begun on several additional holes in the Eastern Deeps. Hole 206 encountered 18.4 metres of massive sulphides within a broader zone of mineralization. Assays are pending.

There are six rigs drilling offset holes in the Eastern Deeps, out of a total of 11 at the Voisey’s Bay project.

Diamond Fields geologists suggest the Eastern Deeps basal sulphide zone may contain 45 million tonnes that could be amenable to underground bulk mining, although President Cliff Carson speaks more reservedly.

“Really, we can’t even say yet that there’s 45 [million tonnes], but the potential is there for a lot more. It’s wide open in every direction.” The feasibility study for Voisey’s Bay, for which Teck (TSE) is responsible, is on schedule to be completed by June 1996. Construction of the mine and mill facilities could begin by 1997, once environmental approval and the necessary permits have been granted.

Diamond Fields’ project steering committee has narrowed down the smelting of ore from the deposit to three possible pyrometallurgical processes. It is also considering three possible hydrometallurgical processes for treating the ore.

“We’re going to study both [hydrometallurgy and pyrometallurgy] in detail,” Carson says. “Even if we become convinced that pyro is the way to go, if you look 15 or 20 years down the road, hydro will be the technology of the day. Therefore, we’re going to continue to study it as if we were going forward with it, so that when it is ready to be brought on, we’ll be right there.” He says underground bulk mining of the 600-metre-deep Eastern Deeps ore can be accomplished almost as cheaply as the open-pit mining of the near-surface ovoid zone.

“Because of the nature of the deposit, we can sink a shaft down to the bottom and take out the massive sulphides — that basically pays for sinking the shaft. Then we can take large stopes and build up, and use our own tailings as fill, making it a cut-and-fill method.”

The cost of the underground operations would be $5 or $6 per tonne.

When asked to comment on rumors that Diamond Fields has abandoned its strategy of retaining top-to-bottom control of Voisey’s Bay, in favor of selling more of its majority stake, Carson says little has changed since the discovery of the deposit.

“We have only a couple of dozen people in the company, so it was clear that if we wanted to get this going in 1998 or 1999, there was no way we could do it ourselves. That was why we made the strategic alliance with Inco — we needed them in order to get this project going.”

But he adds: “Management’s philosophy has been, and continues to be, to run this project and to get it up and going. There has been no change to that. Our responsibility is to maximize shareholder value.”

While he does not rule out the possibility of selling more of Voisey’s Bay to Inco (TSE) or another firm, he says no formal offers have been submitted.

Robert Purcell, manager of corporate public relations for Inco, says the 30% share of the project Inco acquired “was all that was offered to us,” and remains so.

“If we had the opportunity to acquire more, we would do so.” Purcell says the possibility of a major firm such as RTZ acquiring a chunk of the Voisey’s Bay deposit does not concern Inco. “We would prefer it were us, but that’s not our call. We’re a junior player in this game.”