Voisey Bay deposit shows potential to become low-cost nickel producer

Few mineral projects have developed as quickly as Voisey Bay, a nickel-copper-cobalt project with open-pit potential favorably situated in moderate terrain 10 km from tidewater and about 35 km from Nain.

The discovery holes were drilled in the fall of 1994, but already it is obvious that owner Diamond Fields Resources (TSE) has a nickel-copper-cobalt deposit with the potential to become one of the world’s lowest-cost nickel producers, plus a land package prospective for similar discoveries.

This potential, and its implications for the future of the nickel industry, was not lost on Teck (TSE), the first major to secure a position (10.4%) in Diamond Fields. Teck also agreed to provide its engineering and mine development team through the conceptual design and prefeasibility study at no cost.

Meanwhile, exploration is continuing with three rigs, under the direction of Archean Resources and in consultation with Diamond Fields. For geologist Kerry Sparkes, previously with Noranda, working at Voisey Bay is a once-in-a-lifetime experience.

“I know I’ll never see anything like this again,” Sparkes told The Northern Miner during a recent site visit. And indeed, it was impossible not to be impressed by the boxes of core being brought in for splitting, particularly the massive sulphide portions where the sulphide crystals are often as large as a thumbnail.

About 50 people are employed by Archean on site, including 15 Inuit. Now that the Innu have dropped their protest against drilling efforts (part of a larger, unresolved land claims dispute with government), four Innu from Davis Inlet have joined the team. “This is a home-grown project and all the people on site are from Labrador or Newfoundland,” said Archean President Albert Chislett, who added that he expects government support to be strong in view of the region’s high unemployment.

So far, 81 holes have been drilled along a strike length of 600 metres, using, for the most part, a 50-metre vertical hole spacing. Most analysts agree that about 20-25 million tonnes of high-grade mineralization have been well-defined within the massive sulphide (pentlandite, chalcopyrite and pyrrhotite) ovoid body. There is also a sizable resource of lower-grade mineralization, and potential for more reserves to be defined in extensions to the west and east, and in targets not yet fully tested by drilling. A reserve calculation by Teck is expected shortly.

What’s more, the grades at Voisey Bay surpass those of Falconbridge’s Raglan deposit in the Ungava Peninsula of northern Quebec. Geological reserves there total 18.1 million tonnes grading 3.13% nickel and 0.88% copper, at six separate sites, with only 1.9 million tonnes considered minable by open-pit methods.

In contrast, the weighted average of the drill intercepts to date in the main ovoid at Voisey Bay is estimated at 3.71% nickel, 2.14% copper and 0.15% cobalt. The ovoid roughly measures 500 metres long and about 275 metres wide.

Voisey Bay has caught the mining industry by storm not only because of the remarkable consistency of the grades within the massive sulphide ovoid and the favorable metallurgy which appears to be amenable to low-cost, hydrometallurgical processing using pressure-leach, solvent extraction-electrowinning (SX-EW); but also because of its unique geological setting.

“I don’t [know of] a Canadian model for Voisey Bay,” said Anthony Naldrett, a geology professor at the University of Toronto and one of Canada’s foremost authorities on nickel deposits. “There are two analogies I would make, although neither fits exactly. One is Noril’sk in Russia, although it is deeper, larger and higher in grade; the other is Kambalda in Australia, although it is smaller than Voisey Bay.”

Naldrett said more work needs to be done before the genesis of Voisey Bay is understood. “It could be a feeder to a layered intrusive, but nickel deposits do not form as part of the process of layered intrusion. Something has to happel to shock the sulphides out of the system.”

Referring to a breccia zone which contains partly digested gneiss, he stated: “I think we see the genesis of the deposit here.”

Naldrett spent several days on site at Voisey Bay where he logged core to get a better handle on the geology. “What you have is an extensive sheet of troctolite sandwiched in gneiss a sheet with a top and a bottom, and not a dyke. I believe this to be a sill.”

He said this stratigraphy is present everywhere except in the southeast, where peridotite is noted within a layered intrusive. “The whole thing is dipping to the south and has a rake to the east.”

This “sandwich,” Naldrett explained, goes on for 4 km to the west of the main ovoid. “Within this sheet of troctolite is a river of massive sulphides and I see no reason why there would be just one river. One thing that has to be done is to drill this sheet downdip.”

The recognition that massive sulphide mineralization occurs in troughs within an extensive sheet of troctolite enhances the potential of the property, and, moreover, provides a model for the exploration team to look for similar bodies elsehwere in the sheet.

Geophysical methods appears to work well at Voisey Bay, and they show that the deposit has been affected by faulting (shearing, normal faults and thrust faults), and that the geology appears to be more complex in the east. This has prompted the geophysical team to make comparisons with the Finnish nickel deposits. However, for several reasons, Naldrett does not share this view one being that the Finnish deposits are highly metamorphosed, whereas Voisey Bay is not.

On the metallurgical front, Naldrett expects Voisey Bay ore will be easy to beneficiate. “It has some of coarsest pentlandite and chalcopyrite I’ve ever seen,” he said. The U of T professor believes it was Voisey’s Bay subsequent history, rather than the initial cooling period, that governed the coarse nature of the mineralization. “There was a fair amount of oxygen in this, which is why we are seeing magnetite with a large grain size.” During the site visit, Sparkes and Diamond Fields geologist Dennis Dunn showed core from hole 73 (line 1200) through its entire geological sequence. The hole penetrated the typical gneiss or granodiorite hangingwall and then the troctolite unit, which has an upper disseminated zone (with a spotted appearance), followed by better-grade disseminated sulphides and then high grade massive sulphides, through to the base of the troctolite where blotchy droplets of sulphides are evident. Erosion prevents the top sequences from being seen in the ovoid; hence drilling goes through overburden right into the massive sulphides.

While the nickel grades remain relatively constant, changes are evident in the ratio for copper-to-nickel. “Once the modelling is done, we should see a nice copper halo in the deposit,” Sparkes said.

Geophysical work by Dighem is still in progress on the land package, which has been divided into five blocks. Geophysicist Terrence Crebs is clearly excited about results in hand from four of these blocks. “We are seeing good conductors on every block,” he said.

Now that most of the snow has melted from the ground, operators will focus on defining geophysical targets such as Zorba and Archie, as well as the Edge prospect, which Crebs describes as a “Voisey-Bay look-alike.” Drilling on these outside targets is expected to start in July.

Mapping and surface prospecting are expected to begin shortly, and the team of geologists is eager to learn more about the project’s overall setting in order to guide ongoing exploration.

Diamond Fields and Archean are reluctant to comment on Voisey Bay’s potential for precious metals and platinum group elements, except to say that work in this area is ongoing and that some portions of the deposit may have these commodities in payable quantities. So far, however, they appear not to be abundant in attention-grabbing concentrations.

This may actually be advantageous if Diamond Fields pursues a fully integrated operation at Voisey Bay using hydrometallurgy an option that will be examined in the prefeasi
bility stage. It has not gone unoticed that John Paterson, a metallurgist with more than 30 years’ experience in process operations, has joined the company as executive vice-president of nickel operations.

Voisey Bay is believed to be well-suited to the use of pressure-leach/SX-EW processing proven technology which not only has environmental advantages over conventional milling, smelting and refining, but which is also uses less energy. Another advantage of pressure-leach/SX-EW is that it provides a dramatic increase in cobalt recoveries over the smelting route.

Pressure leaching will allow the project to be built up in stages by the addition of modular units, in much the same way that autoclaves are added to a gold operation. Selective solvents would be used during the SX-EW process to extract the copper, nickel and cobalt.

It is speculated that mining and milling costs at Voisey Bay may be so low as to result in “negative-cost” nickel, after credits for cobalt and copper are taken into account. This may explain why Diamond Fields Co-chairman Robert Friedland does not appear to be willing to give up much more than a small slice of the pie.

Much work remains to be done in order for Voisey Bay’s full potential to be fully understood, and it is still early to speculate as to which major company (or companies) will participate in the project in the years to come.