More Positive NewsMountain Province finds a Wallace surprise
2007-01-24 15:25 ET - Street Wire
by Will Purcell
Mountain Province Diamonds Inc. and its Gahcho Kue partners may have more kimberlite between the 5034 and Hearne pipes than they reckoned. A summer drill program delivered a significant kimberlite intersection in an area outside the planned open pit and further good news in the area may prompt a change in the mine plan. Making the pit larger would not be a major undertaking, says Mountain Province president, Patrick Evans.
The Wallace surprise
Three big pipes form the core of the Gahcho Kue project, but majority partner, De Beers Canada Inc., drilled into several smaller bodies in the late 1990s and early 2000s. The diamond giant left most of the bodies out of the mine plan, but the 5034 South and Wallace kimberlites could contain enough kimberlite to warrant some changes.
De Beers drilled a single hole between the 5034 South and Wallace pipes and hit 37 metres of kimberlite, commencing at a depth of 95 metres. That test probed an area about 250 metres southwest of the fringe of the main 5034 pipe. The 5034 South pipe is about 150 metres southwest of 5034 and Wallace lies another 200 metres to the southwest.
The result is intriguing. Mr. Evans said if the 5034 South and Wallace bodies connect at depth, it would certainly influence the pit design for 5034. In fact, Mountain Province is now pondering the implications farther to the southwest. "One really has to wonder, given the northeast to southwest track, what happens between Wallace and Hearne."
Mr. Evans said the one hole did not give nearly enough information, but the partners still plan to put all their drilling effort into the Tuzo pipe this spring. The former president of SouthernEra Diamonds Inc. said that exploration drilling in the area between Hearne and 5034 could wait until next winter without affecting the project timeline.
If that program yields more kimberlite, the Gahcho Kue partners can easily alter their mine plan. Although the core portions of 5034 and Hearne lie beneath the waters of the lake, the current plan calls for nearly all the water to be removed. That will put the area between the two main pipes on land and there would be no need for additional dikes.
The encouragement
De Beers tested small amounts of Wallace and 5034 South kimberlite for diamonds in 1999 and proved the bodies are significantly diamondiferous. A 40-kilogram batch of rock from Wallace and 80 kilograms of 5034 South kimberlite yielded diamond counts and stone sizes roughly comparable with other tests of the Gahcho Kue pipes.
The numbers suggest Wallace and 5034 South likely have diamond grades similar to Hearne, 5034 and Tuzo. If so, the rock would be of economic interest, if further drilling proves the region contains enough diamonds to warrant altering the pit dimensions.
De Beers originally thought the Wallace body was unlikely to be more than 60 metres across at its widest, which would limit its economic potential. If further drilling shows it connects with 5034 South, the perception would quickly change. A continuous body about 200 metres long and barely 20 metres wide could contain one million tonnes of kimberlite to a depth of just 100 metres.
New discoveries in the region just northeast of Hearne could yield further encouragement and there are encouraging signs that Mr. Evans may be right about the prospects in that area. De Beers found the Wagner kimberlite dike to the southeast of Wallace, but dismissed it as too small to be of interest. Further drilling along the southwesterly trending corridor may yield more surprises, as there are several other smaller kimberlites along the main line of pipes.
Mountain Province closed up a penny to $4.06 Tuesday on 24,600 shares.