Virginia Gold Mines an exploration pioneer in northern Quebec

The Quebec government is encouraging mining companies to explore outside of the province’s traditional mining camps. Two associated juniors, Virginia Gold Mines (ME) and Explorations Diabior (ME), have taken up the call by generating projects that are already attracting interest from majors.

The companies, which plan to merge into a single entity (to be known as Virginia Gold Mines) this May, recently signed a joint-venture agreement with Barrick Gold (TSE). The deal covers portions of the project known as La Grande, situtated in the James Bay area.

Virginia and Diabior began work in this under-explored region by taking till samples on surface. “We found between 25 and 300 gold grains in each of the till samples and, because of that discovery, found a number of zones and a sericite schist horizon we think have similarities to Hemlo,” says Andre Gaumond, president of both Virginia and Diabor.

Work to date has identified other geological environments, such as quartz veins that fit the Val d’Or model, and plenty of iron formation. The lack of competition enabled the companies to tie up ground along 40 km of length.

Gaumond says majors are now taking a keen interest in the region. “We staked one area and found that we had been completely surrounded by Phelps Dodge.” Gaumond says that, at first, he found it “weird” that this company was staking iron formation. Since then, however, speculation has grown that the large copper producer is interested in the region’s potential to host a deposit similar to Salabo in Brazil — a huge, producing copper-gold deposit associated with iron formation.

Virginia and Diabior have identified several gold showings that are yet to be fully tested at La Grande. The results were sufficient to attract Barrick. However, Gaumond was not keen to option those prospects until more work was done. “We did a deal only on the northern and southwestern portion of La Grande, where there is known iron formation but where no work has been done,” he explained.

Barrick has the right to earn 50% of those areas by spending $3 million on exploration over four years and paying $250,000 to Diabior. The companies will take turns operating the project until the development stage.

Virginia and Diabior also hold a sizable land package in the Eastmain greenstone belt, north of Matagami. The companies were initially attracted to the region as it hosted an impressive arsenic anomaly.

So far, 12 gold-bearing zones have been discovered on the Eastmain Ouest project, in which Soquem has rights to earn a 50% interest. Three of these — PP-51, LA-Dome C and K — have been tested, with mixed results. LA carried good grades over narrow widths, while the PP-51 had better widths but lower grades. “We think it is a monster, with more than 15 million tonnes at 1 gram, but it is not economic,” Gaumond says. “What we are hoping to find is a higher-grade pocket of at least 1 million tonnes.”

Drilling to test the K showing began in March. The zones are all within a 2.4-km radius of the Eastmain River. For the most part, the river follows a fault that not only separates sediments from volcanics but has secondary structures that are gold-bearing. “We think it is like the Cadillac fault, with all the things we need to find deposits,” Gaumond says.

The companies are also working the nearby Auclair project, which has a geophysical signature similar to the Musselwhite gold deposit in Ontario, namely the presence of a regional fold of iron formation. Stripping, trenching and drilling are planned for 1996.

Elsewhere, in the Labrador Trough area of Quebec, Virginia anticipates another year of work by partner Kennecott on the Sagar project, where the target is an Olympic Dam-type deposit. The ongoing work program is focused on seeking the source of numerous, large, mineralized boulders.

“We have the same metallic association — gold, copper, uranium and rare earths,” Gaumond says, adding “that’s why Kennecott is here. And this belt is the only Proterozoic belt in the world without a mine in production.” Gaumond cautions that while the target is exciting, the project is not without challenges. “First, there are no roads and second there is no outcrop, particularly in the valley. We have to work it

as a blind target, similar to

the Athabaska Basin in Saskatchewan.”

Gaumond says the strategy of going outside Quebec’s traditional mining camps is leading to some interesting new projects. He cites the companies’ new property in the Grenville, which comprises 15 km of troctolite with copper, cobalt and nickel mineralization. A feeder dyke has been identified in the middle of a fault that cuts an anorthosite intrusion. As well, up to 15% pyrite has been noted, which attests to the presence of sulphides.

“The beauty of this project is that the troctolite has digested sediments, which is the recipe for Voisey’s Bay,” Gaumond says.