Atlantic Report Newfoundland’s first gold rush

Every available diamond drill in Newfoundland is under contract as Canada’s youngest province continues to enjoy its first gold rush. Major mineral exploration and development projects are going on in the western and central parts of the province with about 500 people directly employed.

At the Cape Ray gold project, northeast of Port aux Basques, Dolphin Explorations is spending about $4 million on underground and surface exploration. A total of 30,000 ft of surface drilling is being done this year. Drilling has significantly increased the size of the previously drilled Main zone and has outlined a new gold zone nearby at Windowglass Hill. Dolphin will be building a road from Isle aux Morts to the exploration site once government approvals are given.

At Tally Pond, 140 km southwest of Gander, Noranda Exploration is increasing the number of drills to 10 from six on its Duck Pond copper-lead-zinc-silver-gold deposit. Results indicate that the Duck Pond deposit is high grade, has mineable dimensions and the potential to be Newfoundland’s next mine.

Final drilling data will tell the size of the deposit and whether it can be mined economically. About $2 million will have been spent on drilling by the end of 1987. The project is operated by Noranda as a joint venture with Selco-BP Resources, which has a 40% participating interest in the property.

Gold exploration is most active on the Baie Verte Peninsula, where nearly half of the peninsula is staked. Some 6,500 claims are held by 17 different companies and individuals.

At Deer Cove, north of Mings Bight, Noranda has completed a 7-km access road and an underground adit is being driven on the Devils Cove gold prospect, where Noranda and its partner Galveston Resources are spending $3.2 million on underground and surface exploration this year.

Underground work has confirmed the presence of the significant gold values encountered in earlier surface drilling. Noranda will be drilling to test the extension of the deposit at greater depths.

The Hope Brook gold mine, the largest construction project in Newfoundland, started the gold rush. It is producing gold from the open pit mine and heap leach facility. It is the first mine in the province’s history to regularly produce gold as a primary product. Full production is anticipated in a year’s time.

Open pit mineable reserves have been estimated at 754,000 tons of ore grading 0.13 oz per ton; underground reserves are estimated at 10.6 million tons grading 0.12 oz. The mine’s life is projected to be 11 years.

The Newfoundland Department of Mines is calling for proposals for development of two marble deposits near Roddickton on the Great Northern Peninsula. The deposits, at Coles Pond and Pennys Pond, were discovered by the mines department in 1985 and evaluated by drilling in 1986.

Drilling results show that they contain at least three million tonnes of high quality white marble which would be suitable for use as mineral fillers in the paint, plastics and paper industries.

A detailed report on the deposits is available from Paul Dean, director of Mineral Lands and Mines. Proposals for development will be accepted until Dec. 31.

Lotus Resources is another new company which has sprouted on the Nova Scotia mining scene recently. Incorporated last February, Lotus has filed a preliminary prospectus for its initial public offering to raise $750,000 through the sale of 600,000 units, each unit consisting of one common share and one common share purchase warrant.

Lotus’ portfolio of properties includes claims covering or adjacent to former gold producers at Kemptville, Yarmouth Cty.; Lower Seal Harbour and Isaac’s Harbour, Guysborough Cty.; and the Blockhouse-Dome, Leipsgate and Gold River properties in Lunenburg Cty. The claims were transferred to Lotus by A. Wayne Lockerby in exchange for Lotus shares.

Lotus’ board of directors includes Lockerby, a Halifax stockbroker and the company’s president; lawyer Robert A. Street; accountant Edward J. LaPointe, and Dr Warren B. Ervine, consulting geologist.

Scotia Prime Resources, a subsidiary of ase-listed Petroco of Texas, has encountered visible gold in each of the first three holes it has drilled on the Seal Harbour gold mine property in Guysborough Cty., N.S.

President Craig Miller reports that the gold occurs in two distinct zones, one of which is the west- plunging extension of the ore zone mined during the late 1930s by Seal Harbour Gold Mines, which milled about 535,000 tons grading 0.08 oz gold per ton in five years of operations. The second zone appears to be a new one.

The holes were drilled near the boundary between claims held on the west by A. Wayne Lockerby of Dartmouth and on the east by Robert Gingell of Maryland. Both groups of claims are under option to Scotia Prime. The core will be sampled once a complete section has been drilled off and interpreted.

In addition to the drilling program, Miller emphasized that a detailed geochemical survey now under way on the Lower Seal Harbour property holds great promise for the discovery of new, near- surface mineralized zones along what earlier prospectors called the Golden Stair, a northwest-trending zone of auriferous drift that extends for more than two kilometres from the ocean to the Seal Harbour mine, where it intersects an east- west structure.

Scotia Prime geologists have found an area of extensive trenching along the Golden Stair southeast of the mine, possibly at the spot where abundant rich drift was reported to have been found in 1935 north of the village of Seal Harbour. There is no record of the source of this gold ever having been found. Claims covering this area are wholly owned by Scotia Prime.

Four Seasons Resources of Vancouver has announced the completion of five diamond drill holes in the first-phase drilling program on the Mitchell property in Restigouche Cty., N.B., about 35 km northwest of Bathurst.

All drill holes have intersected well-altered volcanic and sedimentary rocks in the vicinity of the Knowles vein and the West zone, according to director Ashton Mullan. Hole 5 intersected a 12-ft width of mineralization containing a 6-ft section of combined lead, zinc and copper sulphides visually estimated at 5%. Hole 4, drilled under the Knowles vein, intersected 8 in of lead-zinc mineralization. The mineralized sections are expected to contain significant silver values.

The property is being worked as a joint venture shared between Four Seasons and F.S.R. Maritimes Exploration. In 1959, Dome Exploration drilled several holes on the property, which at that time was a copper prospect.

Stratabound Minerals Corp., a gold exploration company recently posted for trading on the ase, received more than $312,000 in proceeds from its first public issue of 692,000 shares at 45 cents per share.

Besides properties in the Indin Lake gold district in the Northwest Territories, the company will be exploring its Shear gold mine property in southern New Brunswick. Small-scale, high grade gold production grading 0.5 oz per ton took place on the property in 1940. Dump samples at the shaft contain arsenopyrite, magnetite, pyrite, pyrrhotite and chalcopyrite and have assayed up to 0.28 oz.

The Chamber of Mineral Resources of Nova Scotia has published a brochure entitled Mineral Resources of Nova Scotia — Economic Benefits. The publication outlines the significant economic impact the mineral resources sector has had upon the province’s economy. In 1986, for example, the sector contributed almost $300 million in direct expenditure to the provincial economy and was responsible for more than 11,000 jobs. Copies of the brochure may be obtained from the Chamber’s office at Suite 202, 5525 Artillery Pl., Halifax, N.S. B3J 1J2.

The Nova Scotia Department of Mines and Energy will hold its annual open house Nov 25-26 at the Lord Nelson Hotel in Halifax. Mines Minister Joel Matheson will be the luncheon speaker.

Department geologists will give presentations on their current activities and there will be technical displays by provincial government geologi
sts, the Geological Survey of Canada and universities, according to Dr Howard Donohoe of the department.

In conjunction with the open house, the Chamber of Mineral Resources of Nova Scotia is sponsoring a special symposium on mineralization and mineral deposits in the province, with emphasis on precious metals.

Invited speakers from exploration companies, government and university research groups will discuss their work, and some of the projects supported by the Canada- N.S. Mineral Development Agreement will be described by mines department staff.

The symposium will also be held at the Lord Nelson Hotel, on the afternoon of Wednesday, Nov 25.