Diamond play gains credibility in 93

If 1992 was the year diamond fever swept Canada, 1993 will be remembered for the solid exploration results that made even diehard skeptics concede that this country may soon have its first diamond mine.

While it has been known for decades that the Archean-age cratons covering large portions of Canada have potential for producing diamonds, it took almost 10 years of hard work by a little-known junior company for the first discoveries of economic significance to be made.

It is now safe to say that the most advanced diamond project being developed in North America today is that of Dia Met Minerals (TSE) and its senior partner, BHP Minerals Canada, in the Lac de Gras region north of Yellowknife, N.W.T.

So far, the partners discovered 26 diamondiferous kimberlites within what appears to be one of the worlds richest kimberlite clusters or fields. The discovery of the first diamond-bearing pipe, Point Lake, was made in April, 1990, by Dia Met Chairman Charles Fipke. His discovery was the culmination of 10 years of geologic detective work which involved tracking a glacial dispersion train of indicator minerals for hundreds of kilometres from the Mackenzie Valley to Lac de Gras.

The indicator minerals associated with kimberlite typically pyrope garnets, chrome diopsides, chromites and ilmenites provided not only a detectable pathway to the source pipe, but also geochemical information which enables explorers to select diamondiferous targets.

In 1992, a 160-tonne bulk sample of the Point Lake target was performed, from which were obtained 101 carats of macrodiamonds (25% of gem quality and some in the 1-to-3-carat range).

By 1993, however, several targets more prospective than Point Lake (and of equal size or larger) had been identified. Several of these were tested by bulk sampling in early 1993, returning such encouraging results that the figures from Point Lake were soon considered too low to justify further exploration.

Key data which came from the joint venture in 1993 were valuations for macrodiamonds from three pipes sampled earlier that year. These valuations were based on the mean of six independent estimates.

A 49.8-tonne sample from Pipe 4, containing 62.11 carats (31% of gem quality) was determined to have a mean value of US$112 per carat (for the entire sample, not just the gem fraction). The remaining two pipes have a mean value of US$81 and US$81 per carat, respectively. These results, which rivaled those of producing South African and Russian pipes, established that Canada has the potential to become a producer of high-value diamonds. BHP and Dia Met are now carrying out larger bulk samples of 3,500-5,000 tonnes on two targets. One will be tested by a large-diameter drill, the other by an underground program. Smaller tests may be done this winter on other prospective pipes, particularly 93-J, a kimberlite which yielded an impressive 155 macros and 259 micros from 60.5 kg of core.

The joint venture also revealed that kimberlites at Lac de Gras are geologically young (the isochron age of one pipe being 52 million years) and relatively uneroded.

The discoveries made by Dia Met also sparked a staking rush which ranks among the biggest in Canadian history. Another large major, Kennecott, moved quickly to position itself in the Lac de Gras region through joint ventures with junior companies. These include VSE-listed Kettle River Resources and Dentonia Resources, and ASE-listed Horseshoe Gold. Also involved are TSE-listed Aber Resources and SouthernEra Resources and VSE-listed Commonwealth Gold.

In the Lac de Gras camp, Kennecott is now bulk-testing its main target, which consists of the Tli Kwi Cho (or DO-27) pipe and its satellite pipe, D0-18. So far, core drilling on DO-27 has yielded 349 macros and 1,111 micros from 1,739.6 kg of core. The $10-million underground program, now under way, will provide the first information on the approximate grade of these pipes and the percentage of gem-quality diamonds contained therein.

A more recent discovery, the Torrie pipe, was made by three juniors: ASE-listed Tanqueray and Fibre-Klad, and VSE-listed Mill City Gold. The pipe has so far yielded 39 macros and 152 micros from 161.6 kg of core. Several other majors, namely Monopros and Ashton Mining of Canada, are active in the North, as are a large number of juniors.

But diamond exploration was not confined to the Northwest Territories in 1993; almost every Canadian province, exluding the Martiimes, received some attention during the year.

Activity in Alberta, still in the early stages, has been secretive. The province is underlain by protons and parts of several archons and is therefore considered prospective for both kimberlites and lamproites. Saskatchewan has received considerable attention since the

Uranerz-Cameco-Monopros joint venture announced the discovery of diamonds at Fort a la Corne. A cluster of kimberlitic bodies was discovered under 100-metre-thick overburden, yielding a high percentage of gem-quality stones. The preliminary grade estimates of the various bodies are low, however, and more work is required before economic significance can be estimated with any confidence.

This year, Rhonda Mining (ASE) and Aaron Oil (ASE) discovered one macro and 19 micros from three holes which tested an apron which surrounds a neighboring Uranerz-Cameco-Monopros kimberlitic target.