There’s a lot of work to be done between announcing Canada’s ‘newest’ diamond play, and Canada’s ‘next big’ diamond play. But the assorted prospectors around the Pikoo project in central eastern Saskatchewan appear to be doing that work in quick time.
In November of last year, North Arrow (
TSX:V.NAR,
Stock Forum) tested a 200 kg drill core sample and returned 745 diamonds larger than the 0.106 sieve size, with 23 of those larger than an 0.85mm sieve.
They said, at the time, the discovery showed the potential for larger stones, not to mention more kimberlites.
They weren’t kidding.
Lukas Lundin, who knows diamonds,
took out a chunk of North Arrow when Pikoo wasn’t even the company’s main project. The man has a sense for the sparkly and it appears to have not let him down on that investment.
In fact, he added to that stake in February of this year, and now holds 19.5% of the company.
Lundin’s big diamond play before this was Lucara Diamond Corp (
TSX:T.LUC,
Stock Forum), which has a value of some $800m, and doubled in value in just 18 months as it yanked fat diamonds out of the earth on a regular basis and earned 80% operating margins in the process.
North Arrow has doubled in just the last six months.
The company, helmed by renowned diamond sniffer dog Gren Thomas, found
three new kimberlites in March, basically doubling the size of the body and picking up indicators the body is open to the east.
But you don’t get a ‘diamond region’ going without others jumping in, and in Strike Diamonds, Pikoo moved from a one company play to several.
Strike Diamond (
TSX:V.SRK,
Stock Forum)
Chairman, President and CEO Ryan Kalt is a serial land claimer, and essentially took out mineral rights on a circle around the North Arrow play. It’s not a cheap speculative option, but as NAR continued its work, Kalt planned to zero in on the part of his property that is up-ice, reasoning that he won’t only get a piece of the North Arrow action, but he’ll also have plenty of other property to auction off as others pick up the scent. The Pikoo diamond play is getting some big attention and for good reason.
“North Arrow’s discovery has remarkable similarities to the early days of the Lac Des Gras discoveries, which ultimately resulted in four diamond mines and one other slated for production, all within the Archean Slave Craton,” Jody Dahrouge, P.Geol., Strike Diamond’s Vice-President of Exploration told me this week.
“Like the Slave Craton, the Pikoo Diamond Camp is centered within the Archean Saskatchewan Craton. Archean Craton’s are generally critical in finding productive diamond deposits, which was recognized in 1966 when Clifford’s Rule was written.
Essentially, Clifford’s Rule is that most diamonds are found within the core of old, stable Archean (> 2.5 billion years old) cratons.
Says Dahrouge, “These old cratons can have deep, cool roots which remain cool to great depths, and thus provide temperature and pressures under which diamond may be preserved.”
“Exploration led to the discovery of over 200 kimberlites spread out across hundreds of kilometers. These discoveries were made with a combination of exploration techniques centered upon sampling glacial till for Kimberlite Indicator Minerals (KIM’s), then following positive results back along the direction of glacial movement until no more KIM’s could be located. The head of the KIM train would then be surveyed with various geophysical techniques and ultimately drill tested.”
Today at Pikoo, North Arrow Minerals has repeated the same exploration processes, and discovered at least four kimberlites so far.
“Early indications are the kimberlites are dyke-like in shape,” says Dahrouge, noting, “good size potential.”
Strike recently announced a
non-binding LOI with the Winnipeg-based Wildcat Exploration to vend some of their property out. They expect there will be more deals like that going forward, and have more than enough land to do such deals without impacting their own patch of fun. So much land, in fact, that they refer to it as ‘district-scale’ in news releases, and have
set up a website for companies that might be interested in talking.
“This transaction involves tenure that we have not yet explored and allows us to continue to focus our capital in the SC East and SC South areas of the Sask Craton Property where we recently announced encouraging till sampling results,” says Kalt. “Strike Diamond’s large scale tenure position affords us an opportunity to acquire these types of strategic equity stakes in exchange for portions of our mineral tenure, while retaining ground that we believe also has company-making potential.”
NAR
just raised $4m to do more drilling. This is good news for Kalt’s company as it will ride any good news as being indicative of good things over the property line, but Strike is also doing its own work, and reasons they can be far more efficient in doing so, knowing what they know of their neighbours.
They’re raising $500k of their own, with $400k being flow-through financing.
“This financing, which will again see strong insider participation, will enable us to commence further exploration work on the Sask Craton property this summer. We are keen to follow-up on our kimberlite indicator results from last year’s program and perform geophysical work to help us define potential drill targets,” noted Kalt.
Adding to the growing din around the area, none of these companies were there first. Stornoway Diamonds (
TSX:T.SWY,
Stock Forum), helmed by Gren Thomas’ daughter, the mercurial Eira Thomas, had the property first and agreed to JV with North Arrow back in 2013, offering a potential 80% stake based on drilling requirements – requirements NAR has subsequently satisfied.
Alto Ventures (
TSX:V.ATV,
Stock Forum) is also digging around the edges, doing high res airborne magnetic surveying of their 13 hectares, looking for anything explorable, and a pair of uranium explorers are also in the mix; Canalaska Uranium (
TSX:T.CVV,
Stock Forum) has 9 properties nearby and recently struck a deal with Copper Reef, and Athabasca Nuclear (
TSX:V.ASC,
Stock Forum) optioned a handful of the Stornoway targets late last year as well as ground that is directly contiguous to North Arrow, intending to get till sampling done through this summer.
Dahrouge has no doubt more kimberlites will be found, and that competition is heating up.
“Other exploration companies within the region are at various stages of exploration. Strike Diamond Corp. has completed initial reconnaissance scale indicator sampling, which has resulted in the identification of multiple kimberlite trains. Alto Ventures has also completed both KIM sampling and airborne geophysics. This has resulted in at least two kimberlite trains, and numerous geophysical targets. In addition, Canadian International Minerals has formed a joint venture with North Arrow on lands they held ‘up-ice’ from the initial discoveries. North Arrow completed limited sampling in this area during 2014, which resulted in what appears to be at least one new KIM train forming.”
So that’s six companies in the mix, with four having switched from nibbling to plunging their faces in deep. Comparisons to the early days of the Athabasca uranium rush are not without foundation.
“It’s interesting to draw comparisons between the uranium exploration success being experienced by a number of companies in the Patterson Lake area to the diamond exploration success now being had by numerous public companies exploring at Pikoo.” Says Kalt. “You know, it is probably not a coincidence that at PLS, the initial ‘hint’ was a down-ice uranium boulder, and at Pikoo there was a similar result in finding kimberlite float down-ice of North Arrow’s drill-confirmed kimberlites.”
“As a whole, Saskatchewan was unexplored for many years, and the wealth creation occurring at both PLS and Pikoo is exemplary of the opportunities,” he says
So who will be the Fission Uranium of Pikoo? The establishment A-listers of North Arrow? The upstart claim pounders of Strike? The uranium company taking a dice roll? The little guy slapping a dart on the map and flying a plane over it? Will Stornaway regret its decision to focus on other things? Will Lundin ever miss?
These questions and more will be answered in the months ahead.
This is the first in a series of articles about areas of the resource world that are showing uncommon life. The second focuses on the Abitibi greenbelt gold region, where companies with great testing results are getting increasingly desperate for cash, while one former black sheep is turning it around. Read that feature here.