Radisson, Que. —
Dianor was formed in 1987 to explore for gold and base metals under the name Ressources Kimex. In 1993, Kimex consolidated its shares on a 1-for-10 basis and adopted the name Ressources Dianor, legally adding the English version, “Dianor Resources,” in 1997.
While Dianor picked up its first key James Bay properties in 1997 for their gold and base metal potential, by 2000, the company had begun to dabble in diamond exploration by sampling a few breccia bodies that contained zinc-bearing chromites.
In June 2001, Dianor announced the watershed discovery of a clear, yellow microdiamond on its PEM 1404 property, which encompasses 5 sq. km about 65 km south of Radisson and 7 km east of the Matagami-Radisson Highway.
Processed by the Saskatchewan Research Council, the diamond has the dimensions 0.1 by 0.1 by 0.08 mm and is octahedral/cubic in shape. It was contained within a 13.6-kg sample taken from a 0.8-to-4-metre-wide xenolithic lamprophyre (or more precisely, spessartite) dyke that extends more than 100 metres and is part of a swarm of similar dykes to the east.
The discoverer, current Dianor President John Ryder (who was serving as a technical consultant to Dianor at the time), described to The Northern Miner how he went about picking up diamond claims during that period: after some initial reconnaissance work in the field, he simply went into a local provincial mining office and spent some time on their digital database. He combed through all the airborne magnetic surveys flown by the federal and provincial governments in the area, and punched in key words such as “diatreme” and “breccia,” and left a short while later with 300-400 actual outcrop references identified by 1-to-50,000-scale geological mapping carried out by provincial geologist Jean Goutier and others from 1995 to 2000. Some of the outcrop data even included whole-rock chemistry and full lithological descriptions.
“That saved us millions of dollars, rather than having to go and find those outcrops ourselves,” said Ryder. “The Quebec mines ministry is light years beyond any other survey: everything is computerized on the spot, and you can get all the data right off the web.”
Dianor then synthesized those data and ran them through mathematical filters before making its final staking decisions, which resulted in the staking of 230 claims by early 2002. In particular, Dianor staked circular magnetic anomalies and areas mapped as heterolithic breccias and xenolithic-bearing lamprophyre dykes.
Since then, Dianor has been working year-round from a 15-person exploration camp built on the shore of Lake Ekomiak, 65 km south of Radisson and just a hundred metres off the paved, all-season Matagami-Radisson Highway. A year-round commercial airport is 40 km north of the camp, and the coastal Cree community of Wemindji is 130 km to the west.
The regional centre of Radisson (population 2,000) is the town built in 1974 to service the Quebec government’s $21-billion, 15,000-MW, 800-km-long series of La Grande hydroelectric dams and power stations. The system’s largest power station, the Robert-Bourassa (or LG-2), is at the eastern edge of town.
In other words, if a mine were ever built in the area, it could take advantage of the excellent infrastructure that is already in place — an advantage that did not exist when Ekati and Diavik were being developed in the Northwest Territories.
Agreements
In early 2002, even as it was launching a $1.5-million follow-up diamond exploration campaign, Dianor negotiated two new partnerships in the region:
— In February 2002, Dianor entered into a joint venture with Wemindji Exploration (Wemex), a private company owned by the community of Wemindji.
Together, Dianor and Wemex staked 89 claim blocks north and south of
q A month later, Dianor and Wemex entered into an agreement with Ekati discoverer Charles Fipke’s privately held diamond company,
Lucky Panda was subsequently vested into publicly traded
Ryder noted that since the opening of the Ekati mine, Fipke has been receiving an offtake of non-gem-quality, inclusion-filled diamonds from the mine and has built up an extensive, proprietary database of geochemical and mineralogical information that he intends to use for diamond exploration elsewhere, including James Bay.
Commented Ryder: “There’ve been a lot of advances: [Fipke has] developed a series of chemical plots and charts that enable him to tell if a kimberlite indicator mineral has come from a diamond-bearing kimberlite, and even if it has come from kimberlite bearing large diamonds.”
Geology
The geology of Quebec’s James Bay region has two major similarities with Ontario’s James Bay region, where
Most importantly, the entire James Bay region is underlain by the Superior craton, the world’s largest Archean craton and a prime hunting ground for diamonds. Dianor’s properties are in the eastern part of the Superior Craton, in the northern portion of the La Grande subprovince. Structurally, the properties are at the intersection of three major features: the Kapuskasing structural zone, which has been mapped to Wawa, Ont., and could extend as far as Quebec’s Torngat Mountains; the Wemindji-Caniapiscau structural zone, which extends from Wemindji eastward to Schefferville in the Labrador Trough; and the smaller Sakami graben structure.
Also, both sides of James Bay share a similar glacial history that makes looking for diamonds a tougher task than in most other spots in Canada: there is a thick layer of unconsolidated marine sediments deposited in a 135-to-200-km-wide swath around the shoreline of James Bay.
These sediments were deposited when the craton under James and Hudson Bay was depressed by the weight of kilometres-thick continental glaciers that covered the area for 2 million years but then melted 6,000 years ago, allowing the ocean to flood the land before the craton sprang back to create the shoreline we know today.
On Dianor’s claims, Ryder described the marine sediments as being a “major technical difficulty.” They can be 20-40 metres thick, consist of sands, silts and marine clays, and have reduced the appearance of rock outcrops to only 10% of the territory.
As well, beneath these marine sediments are glacial tills that can display at least four different ice-flow directions.
Clearly, it’s critical that any geologist working in the area has a keen eye and is able to differentiate between marine and glacial sediments, since it is the tills that host the most meaningful kimberlite indicator minerals and other clues as to the direction of ice movement, and hence the potential location of a diamond deposit.
The similarity between marine and glacial sediments also means that past Quaternary mapping in the area always needs to be viewed with some skepticism in case units were mapped incorrectly.
The chief geological difference between Ontario and Quebec’s James Bay regions is that thin Paleozoic limestone units cover the Archean basement rock on the Ontario side and are almost completely absent in Quebec.
There is an advantage to having this cover: airborne magnetic surveys produce better data, since the limestone acts as a filter to weed out background noise. On the other hand, any diamond deposit hidden under this limestone cover can only be discovered with a drill bit, which is expensive.
MMI analysis
The usual procedure for diamond exploration in Canada is to carry out till sampling and geophysical surveying to generate targets, and then to proceed with a drilling program.
The process is often slow and costly. For instance at Wemindji, De Beers and Majescor spent practically 10 years and $5 million tracking a 32-km-long indicator-mineral train back to its diamond-bearing kimberlite-sill source, discovered in 2002.
“In our view, the standard modus operandi of doing diamond exploration is not going to work well in this terrain,” said Ryder. “It will work, but we don’t have twenty million dollars, I don’t have ten years, and we’re not the size of De Beers.”
To deal with the problem of thick marine and glacial overburden, Ryder has introduced mobile metal ion (MMI) technology to Dianor’s exploration crews. MMI is a high-resolution, soil-geochemistry mapping technique developed by the Australians, initially for exploration of precious and base metals. MMI analyses measure extremely low concentrations of metals in ion form. For diamond exploration, the element suite to be examined includes nickel, cobalt, chromium, niobium and palladium.
In the James Bay region, the MMI sampling process is quick and easy: Dianor’s field crews dig through the peat with an auger, and 10 cm below the last appearance of peat, they take a sample.
“The beautiful thing about MMI [as opposed to till sampling], is that the source of the soil anomaly is in the bedrock directly below it,” said Ryder. “The MMI won’t necessarily find the kimberlite, but it will certainly be able to help us eliminate what isn’t kimberlite. All we’re doing in this process is reducing the risk.”
He hopes that someday the system can be calibrated to eliminate 70% of deceptive targets, such as carbonatites or gabbros, which can give geophysical signatures similar to kimberlites, thereby saving time and money that might have been wasted by drilling. (Assisting Dianor with the interpretation of its MMI data is Mark Fedikow, a Winnipeg-based geochemistry consultant.)
Experimental work by De Beers has shown that an MMI anomaly is detectable above its Delta #1 kimberlite pipe in Attawapiskat, and MMI anomalies outlined on Dianor’s ground have indicated geochemical signatures similar to the one seen at Delta #1.
Ryder is also unconventional in not placing much emphasis on the amount of G-10 garnets in Dianor’s till samples: “Let me put this in perspective: G10 garnets have a sixty per-cent chance of coming from graphite and not diamonds, and De Beers’ Attawapiskat pipes have mostly G9s and not G10s.”
Corporate show-down
While Dianor was formulating its plan of attack for its 2002 exploration program, the mood was souring between Dianor’s board of directors and a group of dissident shareholders led by director Daniel Duval, a long-time accountant at Agnico-Eagle’s LaRonde division.
Dianor’s chairman and chief financial officer at the time, David McDonald, was criticized for squandering the company’s funds and not adequately advancing the company’s mineral projects. The make-up of the board was also assailed for not including enough independent directors.
The dissident group won a proxy battle in the summer of 2002, beating out the incumbent directors’ proposed slate of McDonald, Louise Vezina (McDonald’s wife), Pierre Bernard, Paul Anataki and Gilbert Beaudoin.
Duval stayed on as director and became chairman and CFO, and three new independent directors were brought in: Jules Dionne, Pierre Paquet and Christian D’Amours. Ryder, who had become Dianor president in January 2002, added CEO and director to his titles.
Company insiders and shareholders today say Ryder has brought four qualities to the company: an insistence on financial probity; good relations with shareholders and other stakeholders; strong technical skills; and a passion for mineral exploration.
In July 2002, the head office was moved from Montreal to Val d’Or, Que., though Ryder is still based in Toronto, and in January 2003, Toronto-based diamond consultant Nicholas Sayce was retained as an investor-relations advisor.
Exploration
The boardroom drama had abated by mid-2002, leaving Dianor free to focus on exploration. Field crews examined some 120 targets using helicopter support, taking soil, glacial-till and rock samples, plus additional magnetic surveys.
From that work, 45 specific targets were selected based on their potential to be kimberlite bodies. Carl Verley, who helped discover the Kennady Lake diamond deposit in the Northwest Territories, helped Dianor interpret the geophysical data.
In early 2002, more microdiamonds had been recovered from two lamprophyre dykes sampled near the 2001 discovery. One diamond was yellow-beige, and the other white and frosted.
Whole-rock analysis and the mineralogy of these xenolithic lamprophyre dykes proved similar to the diamond-bearing lamprophyre dykes found in Ontario’s Wawa region, on the northern shore of Lake Superior (T.N.M., Dec. 2-8/02).
Although Dianor has now mapped more than 400 lamprophyre dykes, diamond-bearing ones rarely have the tonnage or continuity to be economic deposits. However, they can signify the presence of a larger diamond-mineralizing system. For instance, in the Wawa area, bedrock-hosted diamonds were found first by prospectors in lamprophyre dykes years before much-larger-tonnage, diamond-bearing volcanic-breccia rocks were uncovered by such juniors as
(A visit to Dianor’s project area quickly reveals why Dianor found and sampled the lamprophyre dykes first: the dykes are well-exposed on a rocky ridge, while any potential kimberlite pipes or diamond-bearing tuffs in the area — which are generally softer and thus more easily eroded — are likely hidden beneath swamps and thick layers of glacial and marine sediments.)
About 80% of the diamond properties staked by Dianor were chosen for their potential to contain diamond-bearing kimberlite, while the remaining 20% consist of “Wawa-type” volcanic, heterolithic-breccia targets.
Dianor has so far delineated 10 areas of Wawa-type volcanic centres on its properties, five of which are found on its Lac de l’Astree property. These 10 centres are not deformed as they are in Wawa, which will make it easier to unravel their geological history.
In January 2003, Dianor reported that two microdiamonds had been found at L’Astree. Both are white and clear. One has the dimensions 0.24 by 0.12 by 0.1 mm, whereas the second is 0.24 by 0.14 by 0.08 mm. Both diamonds were recovered from 24-kg samples taken from l’Astree’s Bear volcanic-centre showing.
“This is very good news,” said Ryder. “There’re no ifs, ands or buts: we have Wawa-type diamond-bearing rocks in James Bay.”
Wawa-type rocks can be economic down to a grade of 0.3 carat per tonne, and last winter, Pele found a 0.72-carat stone, proving to skeptics that small-but-still-commercial-size stones can be found in this deposit type.
In June 2003, Dianor reported that, out of 287 heavy-mineral concentrate samples collected throughout its James Bay properties in 2002, 134 contained 2,491 potential kimberlite indicator minerals. These were sent along to Fipke’s C.F. Minerals laboratory in Kelowna, B.C., for electron microprobe analysis.
One more good sign was that most of these kimberlite indicators were found in tills down-ice from magnetic or MMI anomalies. In addition, 21 samples contained 33 gold grains and five samples contained 12 metallic silver pieces.
By August 2003, Dianor had kicked off a shallow drilling program testing several dozen targets, of which six had coincident MMI and magnetic anomalies. The geological drilling is unlikely to provide many thrills to the market, but it is crucial work insofar as it will result in a database of different geological settings that create seemingly attractive geophysical and MMI signatures.
Like many diamond explorers, Dianor’s progress is being hampered by the relatively slow return of assays from Canada’s overloaded diamond-processing labs. (Even samples sent to Fipke’s lab have to wait their turn!). As of late August, Dianor was still waiting for geochemical assay results from till samples taken a year earlier.
Dianor also jumped into the Otish Mountains diamond rush in Quebec, staking 11 claims around the Renard diamond-bearing kimberlites discovered by
“We were late getting to the Otish Mountains, and ended up with a small presence,” admitted Ryder.
In Quebec’s James Bay and Otish Mountains regions, Dianor now has 239 diamond properties totalling 738 sq. km.
Dianor’s gold assets have taken a back seat to diamonds, but with the gold sector on the rebound, the company decided in March 2002 to funnel all its remaining gold and base metal assets into a newly created, wholly owned subsidiary,
Originally, Threegold shares were to be distributed to Dianor shareholders, but that plan was shelved.
There are still reasons not to forget about these properties’ metals potential: roughly a quarter of Dianor’s till samples have contained visible gold, and the MMI work has generated some interesting base metal targets.
The diamond-bearing PEM 1404 property, for instance, has been the subject of gold exploration dating back to 1958-60, when Main Exploration carried out work that included trenching. Noranda explored the area in 1989-91, completing detailed structural analyses, and in 1989, MSV Resources explored the property. Dianor acquired PEM 1404 in 1997, and followed up in 2000 with a 498-metre drill program that cut 68 metres grading 0.89 gram gold in a monzonitic intrusive body.
Ontario prospects
Dianor has a growing presence in Ontario, having signed an option agreement in January 2003 with a prospector and a geologist to acquire 22 claims totalling 11.5 sq. km, dubbed the “Cluster project.”
The claims are in northeastern Ontario’s Larder Lake and Porcupine regions, some 35 km west of the Kirkland Lake kimberlites and 45 km northwest of the Cobalt-New Liskeard kimberlite cluster in the Lake Temiskaming structural zone, which extends 300 km north to the Victor pipe.
Dianor can earn a full interest in the claims by paying $10,000 in cash and 100,000 treasury shares and spending $250,000 on exploration over three years. The vendors would retain a 2% net smelter return royalty on any non-diamond production and a 2% gross overriding royalty. Dianor can buy back half the royalty for $1 million.
During the summer at Cluster, Dianor carried out reverse-circulation drilling, ground-magnetic surveying, and MMI sampling.
In August, Dianor signed another option agreement in Onario, this time with
To obtain a 100% interest in the diamond potential of Globex’s claims, Dianor will pay $4,000 cash, issue 60,000 shares, and fund two short drill holes to test a gold showing and one longer hole to confirm reported ultramafic breccias. The option agreement is subject to a 1% net diamond royalty payable to Globex. In addition, Globex will have access to Dianor’s drill core for gold analysis, with Globex retaining a 100% ownership of all metals or minerals except diamonds.
Dianor reports that Lac Minerals drilled several short holes in the Pacaud area in the 1970s and intersected ultramafic breccias that could be kimberlitic. Dianor began drilling at Pacaud in early October.
Dianor had 50.9 million shares outstanding in May 2003, following a few financings totaling $1.4 million that were carried out in previous months. CTI Capital acted as agent for a $900,000 offering in January.
Posting a 52-week high and low of 16 and 6.5, respectively, Dianor shares last traded at 11.5, generating a market capitalization of $6.7 million.
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