Shareholders of
For each share currently held, Winspear shareholders will receive 0.125 of a share of Diamondex. The Vancouver Stock Exchange has conditionally approved the listing of the shares of Diamondex. Final court approval is pending.
Winspear recently filed an amended statement of defense in the British Columbia Supreme Court in response to a lawsuit filed by
Aber’s action was taken in direct response to a claim made by Winspear, the operator and 67.76% owner of the project, that Aber elected not to participate in this year’s $12-million exploration program by failing to provide written notice of its intention to participate, and that therefore its 32.24% interest would be reduced to 16%.
Aber disputes Winspear’s claim and has stated that it verbally informed Winspear on numerous occasions of its intention to pay its share of the costs. Aber further states, in court documents, that the two companies generally dealt with each other in an informal manner in the context of their relationship under the joint-venture agreement. Aber says Winspear had previously waived the requirement of the formality to provide written notice and had not notified Aber of its intention to insist on written notice with respect to the 1999 budget and exploration program.
Aber says that, in the past, Winspear would provide the necessary execution documentation, which sometimes, but not always, included a place for Aber to sign to confirm its intention to participate. Aber further states that a copy of the approved 1999 budget and exploration program was sent by Winspear but that Winspear did not request that documents be signed in order to confirm Aber’s intention to participate in this year’s program.
In its statement of defense, Winspear denies that either Aber or it adopted any informal practices, or that it had adopted a practice whereby Aber was not required to provide written notice of its decision to participate in a particular exploration program as required under the terms of the joint venture. Winspear states that in 1996 and 1997, Aber served written notice that it would participate in the respective exploration programs for each of those years, whereas in 1998, Aber served written notice of its intention not to participate in the program. Aber’s 1998 decision not to participate resulted in a reduction of its Camsell Lake interest to 32.24% from 43%.
Winspear further claims it had no obligation to provide Aber with documentation to record its intention. “At all times, Aber had the contractual onus of preparing its own documents in order to serve notice upon Winspear of Aber’s intention to participate in the 1999 exploration program,” states Winspear.
Aber contends that Winspear’s actions to dilute Aber’s ownership in the Camsell Lake joint venture has been motivated by “malice and ill will” arising from a 1998 dispute and the rejection of a proposal made by Winspear to buy Aber’s interest in the Camsell Lake project.
In July 1998, a dispute arose pertaining to Winspear’s public disclosure of the results of its 1998 exploration program and the manner in which a meeting was held to propose a supplementary budget for additional exploration work in 1998. Aber states, in its court filing, that earlier concerns with respect to the accuracy and completeness of public information disclosed by Winspear in 1997 had led Aber to prohibit the use of its name in any press release issued by Winspear.
Winspear says it received an unsolicited proposal from Aber on Dec. 21, 1998, offering the sale of Aber’s interest in the Camsell Lake joint venture. On Jan. 13, 1999, Winspear rejected Aber’s offer and, in February, put forth its own proposal to buy Aber’s interest for $50 million in cash and shares. That offer was, in turn, rejected by Aber.
Winspear contends that Aber intentionally elected not to participate in the 1999 exploration program in order to further its position with respect to negotiations for the sale of its interest in the Camsell Lake joint venture to Winspear.
Aber is seeking a declaration from the court that it has the right to participate in the 1999 budget and exploration program for the Camsell Lake joint venture, or an order of relief against the forfeiture of its right to participate.
In the meantime, Winspear continues to advance the Camsell Lake project. At the company’s annual meeting in Vancouver, shareholders learned that the primary crush on a 6,000-tonne surface bulk sample of the NW Snap Lake dyke has been completed. Initial results from the first of two samples that collectively make up the 6,000 tonnes will be available mid-June, with preliminary carat values from both samples expected early in the third quarter.
The bulk sample was excavated from two pits set 260 metres apart on the northwestern peninsula of Snap Lake. The sample areas are just east of where last year’s 200-tonne mini-bulk sample was collected. The Snap Lake dyke has yielded the highest diamond values ever reported in the Northwest Territories. Last year’s 200-tonne sample returned a 226.72-carat parcel of diamonds for a preliminary grade of 1.14 carats per tonne. The diamonds were determined to be worth an average of US$301 per carat, which equates to an implied value of US$343 per tonne.
The 226.72-carat parcel included 25 stones weighing more than 1 carat, with the three largest stones — 10.82, 8.42 and 6.04 carats — accounting for 75% of the value.
The purpose of the 6,000-tonne bulk sample is to increase the confidence level of both the grade and the unit value of the NW Snap Lake kimberlite.
President Randy Turner told shareholders that this year’s winter-spring drilling program met its objective of outlining a resource of 5 million tonnes of kimberlite. A revised resource estimate prepared by the Canadian division of Mineral Resource Development Inc. is expected in June.
A total of 84 holes have been drilled since early February, raising to 154 the number of drill intersections recovered from the NW Snap Lake dyke in the past three years. The average down-hole thickness of kimberlite is 2.63 metres, whereas the true thickness believed to be about 90% of this.
Drilling has extended the NW dyke over a north-south strike length of 2 km and as far east as 2.5 km downdip from its exposure on the peninsula. Drilling suggests the dyke appears to be thinning towards the southern and northwestern limits, with a somewhat thicker zone averaging more than 3 metres trending to the northeast. The dyke remains open in either direction along strike, as well as downdip.
Twenty-one of 84 holes drilled so far in 1999 were closely spaced and designed to define the two bulk-sampling pits. Three additional holes were drilled in the northeastern arm of Snap Lake to test geophysical anomalies that may have represented a vertical feeder source. Two of these holes encountered 2.8 metres of kimberlite dyke material, whereas the third hole, collared 3.5 km east of the subcrop, failed to intersect any kimberlite.
Results from drilling to date indicates that while the NW dyke remains gently dipping, it also appears to be gently warped around the northeasterly trending axis, where the thicker parts of the dyke have been found. Turner still feels the cone-sheet theory of the kimberlite emplacement is valid. He said drilling shows a single-phase intrusive system of kimberlite.
Warmer weather has caused Winspear to stop drilling from the ice on Snap Lake, but the company will continue to drill with two rigs on the northern shore of Snap Lake into late June. A limited till-sampling program will be carried out during the summer on areas of the Camsell Lake property where previous sampling yielded unusual concentrations of indicator minera
ls.
During the winter, Winspear completed a 1,904-metre drilling program on its wholly owned Hilltop property, which adjoins the southwestern corner of the Camsell Lake property. The property comprises 265,000 acres and includes some 90,000 acres of scattered claim blocks in which
Drilling tested 14 targets, but no kimberlite was intersected. Exploration in the summer of 1998 had revealed several promising indicator mineral trains, some of which also have small kimberlite fragments. A follow-up program of till sampling, scheduled for this summer, will attempt to define the indicator mineral trains and test new ground recently acquired.
On the Carat property, in which Winspear is earning a 70% interest from
The 94,000-acre Carat property adjoins the northeastern corner of the Ekati mine property block, 350 km northeast of Yellowknife.
Meanwhile, Winspear has entered into an option agreement with
The property occurs at the southern end of the so called “Corridor of Hope.” It has undergone limited airborne geophysics and mineral indicator sampling. Turner told shareholders the property has “interesting structures and indicator minerals.”
An airborne geophysical survey is expected to begin in early May, followed by till sampling later this summer.
Winspear has budgeted about $2 million for summer exploration work outside of the Camsell Lake project.
Be the first to comment on "Winspear spins off exploration assets"