Cominco steps up pace of property evaluation

Turning a supertanker around in a narrow channel is tricky business. Sometimes you have to come to a full halt to change direction, an analogy that probably applied to Cominco before it was taken over by Teck Corp.

But since that time, Cominco has taken a much more aggressive approach to minerals exploration and indeed has raised its profile in that sector quite dramatically. Key properties are being evaluated at a much faster rate and the focus has shifted to developing mines in a timely fashion.

The company has just optioned its Tulsequah Chief property in northwestern B.C. to Redfern Resources which is now controlled by Comaplex Resources International. The mine, which has lain dormant for over 30 years, hosted one of Canada’s premier mineral deposits — and there is still potential to expand the remaining reserve base at the mine. Teck had also expressed interest in the property but its arms-length approach with Cominco and a desire to act as operator precluded such a deal.

Comaplex and Redfern pooled mutually-held claims in the area to secure an agreement with Cominco. In a complicated transaction, Redfern took out Comaplex’s interest in their joint venture for 1.9 million shares all of which are escrowed. This allowed Redfern to negotiate with Cominco and secure a $1.5-million private placement to close the deal. Comaplex now controls Redfern.

The agreement with Cominco gives Redfern the right to earn a 40% interest in the Tulsequah Chief and related properties for an expenditure of $3 million over a 4-year period. Half the funds are in place and Redfern President John Greig confirms the company may do a flow-through offering at a later date.

The Tulsequah Chief deposit was originally thought to be replacement ore in a shear zone that was structurally controlled by the intersection of two faults. So all past exploration efforts were predicated on that assumption. But Mr Greig says the mineralization is genetically massive sulphide in nature , similar to Westmin Resources’ Buttle Lake operation on Vancouver Island.

According to J. Michael Kenyon, a Redfern director, “there is no reason to believe that the Tulsequah Chief area holds any less potential for an economic deposit of the Buttle Lake or Greens Creek size.” (Both Mr Greig and Mr Kenyon are highly qualified and experienced geologists.) Earlier diamond drilling at the Tulsequah Chief outlined reserves below the 5,200 level but the program did not fully delineate any of the lenses encountered. Importantly, the tonnage per vertical foot has increased from 520 in the upper workings to 2,500 at the lowest level.

Surface exploration has already started including line-cutting, mapping and sampling. In addition, Cominco engineers are preparing a report on their recent examination of the 5,200 adit level which will probably be rehabilitated for underground drilling purposes. The surface program should cost about $300,000 and first stage expenditures of $1.8 million would probably be accomplished in one calendar year, Mr Kenyon estimates.

Existing reserves now stand at 780,000 tons grading 0.07 oz gold, 2.9 oz silver, 1.3% copper, 1.6% lead and 8% zinc but not all of this is mineable. The property has a production history so the metallurgy is understood and no significant recovery problems were ever reported. Concentrate was barged down the Tulsequah river to the coast.