Kennady delivers Faraday resource

A maiden resource for Kennady Diamond’s (TSXV: KDI) Faraday kimberlites has added 5 million carats to the diamond resource at the company’s Kennady North project in the Northwest Territories.

The company reported on Oct. 3 that the Faraday 2 and 3 kimberlites contain 3.3 million inferred tonnes at 1.54 carats per tonne. Faraday 1 wasn’t included in the estimate because of insufficient drilling.

The Faraday cluster is located 2.5 km northeast of the project’s Kelvin kimberlite — which contains 13.6 million carats in 8.5 million indicated tonnes at 1.6 carats per tonne — and only 10 km northeast of De Beers’ and Mountain Province Diamonds’ (TSX: MPVD; NYSE: MPVD) new Gahcho Kué diamond mine.

Kennady’s president and CEO Rory Moore tells Diamonds in Canada during a phone interview that the company has seen an improvement in diamond quality at the Faraday kimberlites.

“The grade is very similar to the grade at Gahcho Kué and Kelvin, but what’s particularly nice about the Faraday kimberlites is the high value of the carats, which is considerably higher than Kelvin,” Moore says.

Diamond valuation results for Faraday 2 and 3 weigh in at US$98 per carat, whereas at Kelvin values average US$63 per carat.

“And if you break it down even further, the Faraday 2 kimberlite is looking even more stellar, in that the grade is 2.24 carats per tonne with a value of US$112 a carat,” he adds. “That’s essentially US$250 rock to mine, which is pretty rich ore.”

And there’s lots of room for Faraday 2 to grow, he adds.

Recent drilling has extended the kimberlite beyond the current resource estimate by another 150 metres. The final hole of the 2,800-metre program intercepted 64.6 metres of kimberlite, one of the longest kimberlite intercepts ever drilled at Faraday 2.

“Faraday 2 certainly doesn’t look to be petering out anytime soon,” Moore says. “We see it as one of the many opportunities to build significant tonnes at the project.”

At Faraday 1, bulk samples returned modelled diamond values of US$108, US$164 and $267 per carat for the low, base case and high values, respectively. The work also confirmed that the kimberlite links up with Faraday 3 at its northwestern tip.

The company is finalizing details of an upcoming drill program, which will further expand the Faraday 2 kimberlite, and test additional targets across the 610-sq.-km property.

The kimberlites at Kennady North are angled and tabular in shape  — unlike the carrot-shaped kimberlite pipes seen at Gahcho Kué  — and fall within a distinct structural corridor, which the company has coined the “KFC.”

“There’s a structural alignment between the kimberlites at Faraday, Kelvin and Gahcho Kué,” he says. “And we control the bulk of the KFC both north and south of the mine, so essentially, we control the whole trend. We’ve outlined a number of very nice exploration targets to drill this winter, so we’re hoping that will lead to some new diamond discoveries.”

Moore is no stranger to diamond discoveries. Nearly three decades ago — before diamonds were discovered in Canada — Moore was hired as a consultant by Chuck Fipke, founder of Dia Met Minerals, to lead interpretations at the company’s Ekati project in the Northwest Territories.

Moore says he was attending a conference with Fipke and mentor John Gurney in Saskatoon in 1991 when a geologist on the rig at Ekati called Fipke and said “the eagle has landed.”

“Chuck was very paranoid about security back then and thought his phone was being tapped, so we set up a code phrase for the geologists to use if kimberlite was hit in the hole,” he says. “When we got the call that day, we immediately jumped in a twin engine aircraft and flew out to site. John Gurney and I positively identified the kimberlite, and we knew we were well on the way to some serious excitement.”

So when Kennady approached Moore early last year, asking if he’d like to assume the role as president and CEO, Moore couldn’t resist.

“For me, going back to the Northwest Territories is just fantastic, I get to relive those early days of discovery and excitement,” he says.

Kennady has 50.9 million shares outstanding for a $147.7-million market capitalization.

–This story originally appeared in the November 2017 issue of Diamonds in Canada.