Ashton tests northern projects

It continues to be business as usual for Ashton Mining of Canada (ACA-T), while Rio Tinto (RTP-N) shops around a 65.9% stake in the diamond explorer.

Rio acquired the controlling block in late 2000 through a successful takeover bid of the junior’s Australian-based parent company, Ashton Mining. The Rio group already explores for diamonds in Canada through its wholly owned subsidiary, Kennecott Canada Exploration. Ashton holds an extensive portfolio of diamond exploration projects in Alberta, Nunavut, the Northwest Territories, Quebec and Ontario.

The company is conducting heavy mineral sampling and drilling this summer over some of its holdings in Nunavut and the Northwest Territories. Grid and regional sampling programs are targeting the Ric, Green, Kim and Vic properties. In addition, Ashton will drill-test at least two anomalies associated with the Perseus kimberlite dyke system on the Ric property. Ashton discovered the dyke-like kimberlite intrusion after prospecting in the area revealed abundant kimberlite float widely distributed over a strike length of 1.4 km. Ashton sunk five holes at Perseus last fall, recovering 55 microdiamonds from a 211-kg aggregate core sample. Perseus is a 10-metre-thick dyke that dips about 19 to the north.

Follow-up ground geophysical surveys have identified several related anomalies, one of which occurs up-ice from an area where till sampling recovered a macrodiamond. The August drill program will define the dimensions of the Perseus dyke.

The Ric property is 450 km north of Yellowknife and held under the Slave regional joint venture of Ashton and Pure Gold Minerals (pug-t). Ashton has an 87.3% interest in the joint venture, which covers 2,300 sq. km of ground. The remainder is held by Pure Gold. Ashton is solely funding the current program, and, as a result, Pure Gold will be diluted to 10.3%.

Ashton currently has 37.1 million shares outstanding, or 39.8 million on a fully diluted basis. At the end of June, the company held $4.5 million in cash.

Ashton is raising up to $3 million through a private placement of just under 4.5 million shares priced at 67 apiece. Up to 2.8 million flow-through shares will be offered, with the balance being issued as common shares. The Rio Tinto group has agreed to take down $2 million worth of the offering.