STOCK MARKETS — Diamond interest keeps western markets

Investor interest in diamond exploration continued to shore up western markets which began edging downwards toward the close of our report period ending June 8.

The Vancouver Stock Exchange’s composite index was off almost four points at 1,026.13 from a week ago, while the resource index was ahead 30 points at 1677.97 from last week. Mining analysts are starting to see evidence of the summer doldrums creeping into market action and they expect summer trading will be largely results-driven.

The most active trader on western markets was Alberta-listed Spider Resources, ahead 8 cents at 47 cents for the week. The junior is involved with Montreal-based KWG Resources on a diamond project involving Ashton Mining of Canada (TSE) in the James Bay Lowlands of northern Ontario. Ashton will proceed with sole funding of the Kyle Lake and MacFadyen #1 kimberlites, recently discovered by KWG in the Spider #1 joint venture program.

Ashton can earn up to a 51% interest in the project, at which point partners KWG and Spider would retain a 49% interest.

KWG previously reported the discovery of 2 macrodiamonds and 7 micros on the MacFadyen target (163.6 kg of core) and 10 macros and 91 micros from the Kyle Lake target (106.6 kg of core). Results are still awaited from five other kimberlites, most of which are outside of the Ashton agreement area. VSE-listed Southern Copper eased off 2 cents to 77 cents after reporting on the progress of its Brazilian diamond exploration. The junior is searching for the primary source of alluvial diamonds in the district and is also doing pre-feasibility work for the production of alluvial diamonds along rivers within its concessions.

Southern Copper has been collecting rock samples from numerous occurrences on its concessions, as part of its search for primary diamond deposits. The results of some preliminary indicator mineral analysis suggest these occurrences may represent ultramafic intrusions.

Trading was brisk in Mill City Gold. The junior was ahead 30 cents at $2.16. Investor interest is related to anticipation of results from a 27-tonne bulk sample from the Yamba Lake diamond project in the Northwest Territories, held by Mill City and Alberta-listed Tanqueray Resources. Tanqueray gained 55 cents to reach $4.35.

Carson Gold lost 40 cents at $4.50 after TSE-listed Vengold announced the sale of shares and warrants of Carson. Both companies are active in Venezuela’s Kilometre 88 district.

Not all trading activity on western markets was related to diamond exploration. Madison Enterprises posted a healthy gain of 95 cents to reach $3.45 after announcing the start of a drill program on the Belencillo property in Panama.

The program is operated by TSE-listed Adrian Resources, whose work to date has identified a geological resource of about 17.7 million tons grading 0.029 oz. gold per ton and 0.31% copper. The deposit remains open to expansion in all directions. Adrian has been exploring several copper and copper-gold deposits in Panama, the largest and most advanced of which are on the Petaquilla property.

Madison and Adrian are both headed by geologist Chet Idziszek, who led the team that discovered the rich 21B gold deposit at Eskay Creek in northwestern British Columbia.

Idziszek’s former boss, Murray Pezim, is back in the swing of things with his “Back to Canada” movement. The Pez has brought on board several former Noranda executives who will take a second look at some of Canada’s best mineral districts in Ontario and Quebec. Another junior in the stable, Goldnev Resources, recently announced plans to acquire indirectly a gold-copper project in Alaska.

Drilling on the Zackly property has outlined a deposit with drill-indicated reserves of 1.4 million tons averaging 0.132 oz. gold per ton and 2.19% copper, plus exploration targets.

TSE-listed Hemlo Gold Mines, which can acquire a half interest by spending at least US$5 million, will carry out the 1994 program aimed at defining skarn reserves outside the known mineralization and expanding current reserves. Goldnev was up 42 cents at $1.84 after reporting on its Zackly property acquisition plans.