Disappointing assay results from one of its Labrador properties have brought skyrocketing Cartaway Resources (ASE) back to Earth, dragging the owners of neighboring properties back down with it.
Assays from the first two holes drilled at the Cirque property, 80 km northwest of the Voisey’s Bay nickel-copper-cobalt deposit of Diamond Fields Resources, showed no nickel concentrations above 0.3% and no copper above 0.185%, shattering expectations that “Voisey’s Bay II” had been found.
Over the past year, Cartaway had traded between 90 cents and $3.20. But when the 1996 exploration season began, earlier this month, the stock began to rise. News of net-textured-to-massive base metals found in core from the Cirque property saw Cartaway stock shoot up to $26 on May 16. But when the results (shown on page 15) were released the following day, the shares plummeted to $6.50 within minutes of the news, and the opening bid on the next trading day was just $2. Share prices of companies with claims in the vicinity of the Cirque property, many of which had doubled solely on the basis of claim proximity, fell back to early-May levels.
On the third hole, Cartaway encountered a new body of sulphide mineralization at depth in a layered succession of gabbro and anorthosite in four zones between 127.3 and 194.8 metres down. Cartaway had reported that, on visual inspection, the chalcopyrite in the core appeared to be in the range of 5-10%, which would mean 1.75-3.5% copper. But when the assays came in, there was no copper concentration greater than 0.23%.
In a press release, Cartaway President John Ivany said: “The company is currently reviewing the procedures which gave rise to this disappointment.” He went on to say that all hope is not lost at Cartaway, as the company owns 30,000 claims in Labrador and, to date, has identified almost 50 drill targets. In addition, he said, the Cirque property cannot be written off by three low-grade holes, for the geophysical anomaly on the property is exceptionally strong and indicates the presence of a large body of sulphides.
“The events of the past week have demonstrated how visual estimates of core can lead to unreasonably high expectations, as reflected in both stock trading volumes and prices,” Ivany stated in the release. “An old lesson in the exploration business is that the assays tell the tale. With that in mind, the company will only report on the quality of future holes once the assay results are in hand.”
Despite the disappointing results, Cartaway is continuing its drill program at the Cirque property. Drilling will soon begin on three more holes arranged in a fan from a new setup a short distance from the first one (where each of the first three holes was drilled at a different angle).
Assay results from the first three holes drilled on the Cirque property are shown below:
HoleFromToWidthCopperNickelCobalt
(m)(m)(m)%%%
18.1167.90.060.110.034
26.3539.513.150.1240.070.04
6576110.0420.0340.016
97.4106.559.150.1510.1910.061
121124.33.30.1120.1430.081
29.541.5320.1660.0870.045
49.8859.229.340.1850.1450.062
102.36 111.69.240.1380.0880.037
120.47122.051.580.160.2740.093
310.8 31.4520.650.121 0.069 0.043
37.40 41.00 3.60 0.132 0.128 0.075
53.70 57.50 3.80 0.185 0.094 0.053
106.30 125.30 19.00 0.121 0.073 0.041
127.30 134.30 7.00 0.230 0.168 0.082
147.80 155.60 7.80 0.204 0.189 0.073
167.80 170.60 2.80 0.068 0.098 0.058
176.80 194.80 18.00 0.227 0.145 0.080
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