Cdn Royalties fixes resource figure on Expo

Canadian Royalties (CZZ-T) has released a resource figure for the Expo nickel-copper deposit in Nunavik, northern Quebec, that substantially increases the grade over historical estimates, while decreasing the tonnage.

Strathcona Mineral Services calculated an indicated resource of 4.4 million tonnes grading 0.8% nickel, 0.8% copper and 0.04% cobalt, plus 1.5 grams palladium, 0.3 gram platinum and 0.1 gram gold per tonne. There is an additional inferred resource of 645,000 tonnes, with 1.8% nickel, 1.5% copper, 0.08% cobalt, 2.5 grams palladium, 0.7 gram platinum and 0.1 gram gold per tonne.

Work by Amax in the 1970s had outlined a resource, based on the standards of the time, of 17 million tonnes with average grades of 0.47% nickel and 0.51% copper. A higher-grade core of 3.8 million tonnes grading 0.75% nickel and 0.85% copper made up part of that resource.

The new result was in line with the company’s expectations, based on drilling on the deposit in 2003 and 2004. Indications from the drilling, and from re-logging and supplementary chemical analysis of old Amax core, were that a zone of stringer-style and net-textured sulphides could be blocked out as a higher-grade resource, leaving lower-grade disseminated mineralization out of the estimate.

The estimate also puts the first number on the precious-metal content of the Expo deposit. In the 1970s-era drill program, the cores were not analyzed for platinum, palladium, or gold; nor were they run for cobalt.

The resource estimate was constrained by a pit limit with 50 walls, and a cutoff net smelter return of US$24 per tonne. Those limits caused about 2 million tonnes of net-textured sulphides to be left out of the final resource figure.

Based on the price assumptions in the resource estimate, cobalt would account for about 10% of revenue, and precious metals, another 10%, showing the importance of minor-metal credits to the economics of the deposit.

Including in-pit dilution, the indicated tonnage rises to 5 million tonnes grading 0.7% nickel, 0.7% copper, 0.04% cobalt, 1.3 grams palladium, 0.3 gram platinum and 0.1 gram gold per tonne. The inferred tonnage rises to 722,000 tonnes, with grades falling to 1.2% nickel, 1% copper, 0.05% cobalt, 1.7 grams palladium, 0.4 gram platinum and 0.1 gram gold per tonne.

Two drills are now at Expo, testing targets along extensions of the known mineralized body, and filling in areas to confirm the existing resource.

Earlier resource estimates at the Mesamax and Mequillon deposits bring the whole property’s resource to 10.6 million tonnes. Mesamax, mainly a massive-sulphide body, has 1.8 million tonnes grading 2.1% nickel, 2.6% copper, 0.08% cobalt, 3.8 grams palladium, 1 gram platinum and 0.2 gram gold. Mequillon, a net-textured deposit like Expo, has 4.2 million tonnes with an average of 0.6% nickel, 0.9% copper, 0.03% cobalt, 2.4 grams palladium, 0.7 gram platinum and 0.2 gram gold.

Canadian Royalties has a 70% interest in the property. The rest is held by Ungava Minerals (UGVAF-O).