DIAMONDS — Ashton expects more discoveries in Alberta

Diamond-hunter Ashton Mining of Canada (ACA-T) is in the midst of an aggressive reconnaissance program at its Buffalo Hills joint-venture properties in northern Alberta.

Since 1997, the company has identified 32 kimberlites, 20 of which were reported to be diamondiferous. However, although Ashton has been encouraged by the presence of commercial-sized stones, none of the pipes tested appears to be economic.

The reconnaissance program, budgeted at $7.4 million, is aimed at following up on magnetic anomalies on Buffalo Hills and the surrounding areas, says Ashton President John Auston. “Our work this year is more widespread and focused on target definition.”

Diamond-bearing kimberlites have been discovered over a large area — some as far as 50 km from the original discovery, and Ashton says the occurrence of numerous widespread kimberlite pipes suggests that more lie undiscovered.

The company’s exploration strategy includes airborne and ground magnetic surveys, as well as heavy mineral sampling.

Buffalo Hills is a joint venture among Ashton, Alberta Energy (AEC-T) and Pure Gold Minerals (PUG-T). Once this year’s program wraps up, Ashton and Alberta Energy will each hold a 45% interest in the central 5.5-million-acre land package. The remainder will be held by Pure Gold. Ashton and Alberta Energy will each hold a 35% stake in the surrounding 21.3-million-acre Cayo land package, with Pure Gold holding the remaining 30%.

To date, Ashton has performed one bulk sample on material from pipe K14 and taken mini-bulk samples from four other pipes: K5, K6, K11 and K91. Results are summarized in the accompanying table.

In last winter’s drill campaign, the partners identified six kimberlites, only three of which were found to contain diamonds. The most promising pipe, BH-225, discovered near the K-14 kimberlite complex, yielded five macrodiamonds and 67 micros from a 96.4-kg sample. (A macro is defined as exceeding 0.5 mm in at least one dimension.)

Ashton also holds 500,000 acres in the Slave craton of the Northwest Territories and Nunavut. The claim package comprises the Cross and Roundrock properties, on which, to date, the company has found a total of four kimberlites.

The 43,450-acre Cross property is part of the Lupin joint venture, in which Ashton stands to earn a 51% interest from Pure Gold Minerals and Tenajon Resources (TJS-V). Exploration since 1993 has uncovered the Orion, Cross and Ursa kimberlite pipes.

Diamond analysis of a 2.4-tonne sample from the Cross pipe recovered seven diamonds larger than the commercial threshold of 1 mm. The stones had a combined weight of 0.174 carat, indicating a diamond grade of 7.3 carats per 100 tonnes for the material tested.

Analysis of the Ursa kimberlite returned four micros from a 150-kg sample. However, although the kimberlite is diamondiferous, Ashton says the body is probably uneconomic.

An analysis of 1,171 kg of material from the Orion kimberlite returned one macro weighing 0.29 carat, and, again, grade projections suggest that the body is uneconomic.

Ashton holds a 51% interest in the 51,803-acre Roundrock property, part of the joint venture of the same name; Pure Gold and Lytton Minerals (LTL-T) hold the remainder. Exploration began in 1995, resulting in the discovery of the Aquila kimberlite.

Drilling at Aquila revealed that the body is highly irregular and smaller than anticipated. Ashton says it too is probably uneconomic, and no further work is planned.

Exploration is under way in the vicinity of the Roundrock and the Star properties. “Lots of reconnaissance work and heavy mineral sampling have occurred this summer” says Auston, who adds that the company is also looking at some of the newer and bigger claim blocks it holds north and east of Lupin. A sampling program was recently completed on these propeties, known as Ric, Rock and Con, and results are pending. The properties comprise 398,070 acres and are part of the Slave Regional joint venture, in which Ashton can earn an 81% interest from Pure Gold.

In Quebec, reconnaissance exploration is under way on Ashton’s equal joint venture partnership with Quebec government-owned Societe quebecoise d’exploration miniere (Soquem).

At last report, Ashton had $7 million in working capital and 28 million shares on a fully diluted basis.