Street Wire newsMetalex et al. expand their Attawapiskat hunt
2004-05-05 11:49 ET - Street Wire
Also Street Wire (C-DIA) Big Red Diamond Corp
by Will Purcell
Metalex Ventures, Big Red Diamond, Arctic Star Diamonds and Chuck Fipke's Kel-Ex Development continue to poke away on their Attawapiskat diamond project. The spring effort has been producing new signs of hope in the form of kimberlitic material and toutable diamond indicator minerals that were obtained from an augur drilling program. The shares of Dr. Fipke's partners continue in the doldrums however, as Dr. Fipke and his partners remain tight-lipped about their core drilling program, while rival Spider Resources has been busy scoring kimberlite successes. Meanwhile, Dr. Fipke's group has added some new ground to the west, near Spider's old Kyle play.
The partners drilled four new augur holes along a 150-metre line that have bottomed in kimberlite. The line was about 30 metres in the up-ice direction from a site that produced a macrodiamond and an array of diamond indicator minerals with promotable geochemistry. There were eclogitic and peridotitic garnets in the mineral haul, including G-10s, which are always a favourite with speculators hoping for a quick diamond score.
It was just a month ago that the Attawapiskat partners hit kimberlitic clay in six power augur holes drilled along a 210-metre line that apparently is in close proximity to the spot that produced the macrodiamond. At the time, Metalex and its partners were not sure if the kimberlitic material represented the top of a pipe, or just a thick layer of glacial till. To find out, they launched a core drilling program. Since then, there has been no word of how that effort fared, while Spider has attracted much of the speculative spotlight by scoring three kimberlite hits in quick succession.
Still, some encouraging diamond news would change things in a hurry, and as a result, Dr. Fipke's group has sent samples of the kimberlitic clays off for processing. Presumably, the partners will also be sending material obtained from its latest augur drilling for testing as well.
The latest hits are not the first kimberlite finds for Dr. Fipke in the Attawapiskat region. Last spring, the partners revealed that they had drilled three deep targets that were scattered across an area about 12 to 45 kilometres from the big Victor pipe that De Beers hopes to mine in the coming years.
It was not until mid-summer that Metalex and its partners revealed their kimberlite did not yield any diamonds. That may not have been a big surprise for Dr. Fipke, as although there were indicator minerals in the kimberlite cores, the chemistry pointed toward the pipes being barren.
Not so with the latest drill targets, which Dr. Fipke and his partners have been touting since last fall. The geophysical anomaly associated with the much more promising indicator samples was large to begin with, and it grew considerably after a new look at the data. By late last year, the feature had grown to about 700 metres long and 300 metres wide, with the possibility that it might exceed those dimensions.
Investors reacted enthusiastically to the news that Dr. Fipke might be hot on the heels of a large kimberlite, and the reaction was fuelled by an abundance of G-10 pyropes, eclogitic garnets and chrome diopsides that suggested a significantly diamondiferous source.
Progress has been slow since then, and much of that new wave of speculative enthusiasm has withered away. Still, things could change in a hurry, if Dr. Fipke does turn up kimberlite in its core drilling program, and if the samples now off for processing produce enough diamonds to warrant a closer look.
The Attawapiskat play has produced an abundance of diamondiferous pipes, but even the best of the finds are thought to have contained just modest quantities of microdiamonds, due to a combination of generally low grades and a healthy size distribution curve.
De Beers never formally revealed its initial counts, but the diamond giant now says that its Victor pipe has a grade of about 0.23 carat per tonne, combined with a rock value that would suggest its diamonds are worth something approaching $300 (U.S.) per carat. That unusually high value indicates the stones were of top quality, but it would also require a healthy distribution of large diamonds.
One explorer that did reveal its diamond counts from a nearby find was Spider, when it tested its MacFadyen-1 pipe in 1994. The company processed about 164 kilograms of kimberlite from the pipe, which is a few kilometres north of Victor. The rock revealed just seven microdiamonds and a pair of macros.
That was a modest haul, but a closer look offered hope that MacFadyen-1 also had a coarse diamond size distribution curve. The two largest diamonds weighed a total of 0.065 carat, which would support at least a glimmer of hope that MacFadyen-1 might have a grade that was comparable with Victor. Still, the absolute numbers of diamonds were a tough tout, and Spider was having much more luck at coming up with promotable counts about 100 kilometres to the west, at Kyle Lake.
Spider left its MacFadyen play to pursue the Kyle project, but it is now the latter that is collecting cobwebs as the company has renewed its MacFadyen hunt. Meanwhile, Dr. Fipke and his partners are now showing signs of interest in the Kyle district. The group has staked claims over nearly three dozen circular magnetic targets in the immediate vicinity of Spider's Kyle kimberlites.
Spider and its partner, Pierre Gauthier's KWG Resources, ultimately turned up five Kyle kimberlites, although their first find was the best of the lot. The pipe is fairly large, covering about 2.6 hectares at the surface, and although it tapers at depth, it was estimated to contain nearly 15 million tonnes of kimberlite to a depth of about 500 metres.
That was enough to make things interesting, but the diamond content was not enough to support the promotional efforts of Mr. Gauthier and the play began to fizzle in the mid-1990s. Unlike its Attawapiskat finds to the east, Spider produced some substantial diamond counts from Kyle-1, and although the numbers of macrodiamonds were decidedly more modest, the results sparked a brief market frenzy.
Spider did conduct a mini-bulk test of Kyle-1, coming up with about 3.7 carats of diamonds from 6.2 tonnes of kimberlite, good enough for a grade of about 0.60 carat per tonne. That figure apparently included all of the diamonds recovered, all 4,395 of them, and the figure would have been inflated by an abundance of stones smaller than any realistic commercial cutoff.
The play was intriguing enough to land Ashton Mining of Canada as a partner for a time, and the company processed nearly two tonnes of material in a semblance of a mini-bulk test. Ashton typically uses a 0.85-millimetre sieve as its minimum, and although the company never revealed details of its test, it walked away from the Kyle play, saying the grade of its test was less than 0.10 carat per tonne.
There were signs of richer zones within Kyle-1 that still intrigue Spider to this day. The company still touts one part of the pipe as having delivered a grade of up to eight carats per tonne, although there is no indication of just how much that part of its kimberlite sample had weighed, or if the result was heavily skewed by one or two larger diamonds.
Nevertheless, there seems little doubt that at least some of the Kyle kimberlites were multiphased bodies, with distinct diamond populations within each phase. De Beers examined over 100 of Spider's larger diamonds and found wide variations in the characteristics of the stones that would support the notion as well.
Spider also found reason to promote its Kyle-3 kimberlite, although its diamond content was not quite the match for its sister. After the initial promotion had wound down, Spider spun its Kyle-3 story from a new angle, citing what seemed to be a high-grade zone within the dike, which had produced diamond grades of up to two carats per tonne, based on all of the stones recovered and some tiny samples. Subsequent drilling encountered the better region, but the results failed to match hopes, and the project faltered.
Nevertheless, Spider's earlier results do indicate that the Kyle region is diamond country, and the variations within the bodies add support to hopes that there could be finds with a markedly higher diamond content than what was turned up in the mid-1990s. Like the string of De Beers finds in the Attawapiskat region, the Kyle kimberlites offer a running start for Dr. Fipke's new claims in Northern Ontario.
The Attawapiskat joint venture began several years ago, when Big Red picked up a significant land position in the region, but the driving force behind the project is Dr. Fipke, the Kelowna-based geologist who triggered Canada's diamond frenzy in 1991. He owns Kel-Ex, which signed an option deal to acquire an 80-per-cent stake in the play from Big Red and then flipped shares of its portion to Metalex and Arctic Star Diamonds.
If the partners find a mine on the project, Dr. Fipke would have a 10-per-cent carried interest through Kel-Ex, a situation roughly comparable with his deal at Ekati. Dr. Fipke is chairman of the board and a significant shareholder of Metalex, which would own 52.5 per cent of a mine, while Arctic Star would theoretically have a 17.5-per-cent share and Big Red would continue to hold a 20-per-cent interest.
Metalex shed a nickel on Tuesday, closing at $1.70, while Big Red closed unchanged, at $1.10.