Zinc-copper find in Matagami boosts Donner shares

A new zinc-copper discovery at the Matagami project in Quebec sent Donner Metals (DON-V) shares up more than 33% today to 65 apiece an all-time high.

Two drill holes uncovered massive sulphide at the Bracemac zone grading 9.12% zinc and 1.21% copper over 16 metres and 13.98% zinc and 3.69% copper over 8.8 metres. Assays from a third hole have not yet been released.

Drilling has also intersected 8.6% zinc and 0.14% copper over 2.2 metres in the massive sulphide at Bell Channel, 10 km north of Bracemac.

Donner and joint venture partner Xstrata Zinc Canada, a division of Swiss-based Xstrata (XSRAF-O, XTA-L), have drilled 6,600 metres of a 45,000-metre drill program.

So far, eight holes have been drilled, two historic holes were deepened and one new hole was abandoned.

Donner can earn up to 50% in the Matagami project by spending $20 million on exploration and related work by 2011, in which case five separate joint ventures will be formed covering the property. Xstrata Zinc will have the option to earn back 15% by spending up to $20 million on a feasibility study.

The Matagami project covers more than 4,700 sq. km and includes about 2,100 claims covering 499 sq. km.

The Matagami mining camp has a historical production of 8.6 billlion pounds of zinc and 853 million pounds of copper. There have been 10 past producers of varying size, including the Matagami Lake deposit discovered in 1957, mined from 1963 to 1988.