Agnico-Eagle boosts stake in NA Tungsten’s Jennings

Toronto-based gold miner Agnico-Eagle Mines (AEM-T, AEM-N) is getting an eye for more exotic minerals, and has boosted its stake in the Jennings tungsten-molybdenum project in northernmost B.C., a joint venture with Vancouver’s North American Tungsten (NTC-T).

Agnico-Eagle has exercised its option to increase its interest in the project to 70% from 50% by committing to spend $4 million on exploration before 2011.

Agnico-Eagle acquired its original half stake via its takeover last year of gold junior Cumberland Resources, acquired for about $710 million in shares. That deal’s primary aim was to secure Cumberland’s 100%-owned Meadowbank open-pit gold project near Baker Lake, Nunavut.

North American Tungsten first brought Cumberland in as a partner in April 2006, with the latter agreeing to spend $400,000 on exploration to acquire an initial 50% of the Jennings property (formerly the Tootsee River property), which is located near the B.C.-Yukon border about 85 km west of Watson Lake, Yukon.

With Agnico-Eagle boosting its stake to 70%, North American Tungsten will be able to elect to form a participating joint venture or else convert its 30% working interest to a 2.5% net smelter return royalty. It has from two months after Agnico-Eagle has spent its $4 million commitment to decide.

North American Tungsten CEO Stephen Leahy said the company is “very pleased that Agnico-Eagle Mines has validated the potential” of the Jennings property.

Cumberland’s diamond drilling at Jennings in 2006 focused on a 14-ha tungsten soil geochemical anomaly named the Central Hornfels zone. North American Tungsten describes this initial 1,500-metre, 3-hole program as having intersected variably fractured, veined, hydrothermally altered and mineralized hornfels and skarn, cross-cut by altered and mineralized quartz-feldspar porphyry dykes.

These three holes were drilled at 220-metre spacing, -55 degrees inclination and an east-west orientation across the Central Hornfels Zone.

The first hole, TR06-001, was drilled to a depth of 527 metres and cut 234 metres of 0.092% MoS₂ and 0.110% WO₃ from a downhole depth of 240 metres. The second hole twinned an historic drill hole and intersected 217 metres of 0.167% MoS₂ and 0.120% WO₃ from 277 metres to the bottom of the hole.

The third, easternmost drill hole found only anomalous molybdenum and tungsten mineralization.

North American Tungsten is the Western World’s largest producer of tungsten concentrate through its operation of the wholly owned, 1,200-tonne-per-day, underground Cantung tungsten mine, located in a remote area of the Northwest Territories, about 310 km northeast of Watson Lake, Yukon.

The junior is also developing its Mactung tungsten property in the Yukon’s Selwyn mountain range, about 8 km northwest of MacMillan Pass.