North American Nickel sees good signs at Maniitsoq

VANCOUVER — The 4,800 sq. km Maniitsoq nickel-sulphide project in southwest Greenland may seem like a large-scale play for a junior, but that ambition may pay off for Vancouver-based North American Nickel (TSXV: NAN; US-OTC: WSCRF).

The company has been on the ground at the property for just over a year, and on Aug. 23 it released preliminary drill results from its Imiak Hill target that triggered a 62% jump in its share price.

North American Nickel has so far outlined three closely spaced, north-trending, near-vertically dipping, steeply south-plunging mineralized zones at Imiak Hill. Though the company does not expect results from multi-element assays for six weeks, it announced that hole 13-026 cut 19 metres of sulphide mineralization averaging 40–45% total sulphides, including numerous sections containing 65–80% sulphides, within noritic host rocks at Imiak Hill’s nickel-copper-cobalt zone.

“It is impossible to say anything about grade at this point, but we are optimistic. The nickel tenure method is a fairly standard way to evaluate, and our guys out there are familiar with it,” chairman and CEO Rick Mark said during an interview, noting that Falconbridge determined that 100% sulphides correspond with an 8% nickel grade, based on work completed in the 1990s.

“A good way to look at the model is like the palm of your hand, with the fingers coming up. We have Imiak, we have the [Spotty target] and we’re looking for a third one in the triangle,” he says.

During preliminary drilling in 2012, the company cut 123 metres grading 0.81% nickel, 0.21% copper, 0.029% cobalt, 0.12 gram platinum per tonne and 0.11 gram palladium per tonne at Spotty Hill in hole 12-005. Meanwhile at Imiak, North American Nickel’s drilling results were highlighted by 26 metres averaging 0.98% nickel, 0.44% copper and 0.04% cobalt.

“If we get something there we can start to talk about three of these structures coming up from a source. And the question then is whether it is large enough. [Chief geologist] John Patterson has told us since the beginning that what you expect from a nickel deposit is that it will get better at depth, and down below you typically find the major deposit,” Mark says.

In mid-June North American Nickel got good news from a mineralogical analysis on recoveries from Spotty Hill and Imiak Hill. The company was aiming to quantify nickel, copper and cobalt-bearing minerals within the samples and determine the liberation and association characteristics of the nickel and copper sulphides. All three samples demonstrate high-potential nickel recovery. Mineralogical limiting grade-recovery curves indicate maximum potential nickel grades of 35% at recoveries of 84–87%.

“The first question asked by many experts and guys experienced with nickel is: ‘Where is the pentlandite?’” Mark says. “And I really don’t think the news could have been better on that front. [Quantitative Evaluation of Minerals by Scanning Electron Microscopy] is a new technology, and it’s interesting because historically it would have taken much longer to get that kind of data . . . that adds up to another positive for us, and we haven’t really encountered many negatives on the project yet.”

Over the first half of 2013 North American Nickel has closed two tranches of a non-brokered private placement worth $7 million. The company placed 41 million shares at 17¢ per share, which brings it to just over 116 million shares outstanding.

North American Nickel has traded within a 52-week window of 12¢ to 38¢, and jumped 62% after the Imiak Hill drill results, on nearly 3 million shares traded. The company closed at 27.5¢ per share at press time.