|36 year old cautious guy, thanks for the sincerity. My motive? Be fair, honest and upfront with like minded threadsters to share thoughts and hopefully to make good money. I'll be riding the wave up with you, Kidl, and I think many more visitors to the cafe. THe DDN story is just starting to unfold.|
Diamonds North ponders mini-bulk tests
2008-01-18 16:27 ET - Street Wire
by Will Purcell
Mark Kolebaba's Diamonds North Resources Ltd. may need three core drills at its Amaruk property in central Nunavut next year, based on the latest diamond counts from the Qavvik kimberlite cluster. The Qavvik-3 and Qavvik-4 kimberlites produced diamonds at better rates than Qavvik-1 and Char, two pipes that yielded enough gems to prompt mini-bulk tests last year. If those mini-bulk samples pan out as Mr. Kolebaba hopes, Diamonds North will have ample reason to collect larger batches of kimberlite from several intriguing finds this year. Another multimillion-dollar drilling program appears in the works as a result.
In a Jan. 14 press release, Diamonds North said it recovered 183 diamonds from 72.8 kilograms of kimberlite from Qavvik-3, a rate of 2,500 stones per tonne. Ten of the diamonds sat on a 0.30-millimetre screen, or 5.5 per cent of the parcel. The Qavvik-4 kimberlite produced 129 diamonds from 65.7 kilograms of material, a rate of about 2,000 stones per tonne. Seven of the stones remained on a 0.30-millimetre screen, accounting for 5.4 per cent of the parcel. Both samples consisted of kimberlite chips recovered by a reverse circulation drill used to test new targets.
Although the microdiamond rates are impressive, the proportions of larger stones are not, and many kimberlite plays with higher microdiamond rates and comparable proportions of larger gems ended badly at the mini-bulk stage. Diamonds North is betting that its reverse circulation drill destroyed most of the larger diamonds, skewing its numbers dramatically.
If Mr. Kolebaba is right, Diamonds North will need larger samples from at least three of the Qavvik kimberlites. Last year, the company processed 397 kilograms of reverse circulation cuttings from Qavvik-1, recovering 368 diamonds larger than a 0.106-millimetre sieve. That worked out to just 925 stones per tonne, a rate less than half what Qavvik-3 and Qavvik-4 recently produced. The size distribution profile was not significantly different, as just 32 of the Qavvik-1 diamonds remained on a 0.30-millimetre screen, or about 8.7 per cent of the parcel.
Diamonds North subsequently collected 1.2 tonnes of kimberlite from Qavvik-1 and another 850 kilograms of rock from Char, another Amaruk pipe that yielded diamond counts comparable with Qavvik-1. Mr. Kolebaba said the company was having the material processed by caustic fusion, which will provide the complete microdiamond profile for the samples.
If the two tests do produce significant diamond counts and larger stones prove Mr. Kolebaba's theory about diamond breakage, then mini-bulk samples of Qavvik-3 and Qavvik-4 could easily yield more sparkle than the first discovery in the Qavvik cluster. That would also be the case at Tuktu-1, which produced even more microdiamonds and a comparable size distribution profile. Further, the company has several other Tuktu bodies that could also be worth testing.
Mr. Kolebaba said he is planning to have more drills at Amaruk this year, perhaps as many as three reverse circulation rigs to test new targets and as many core rigs to collect larger batches of kimberlite from the best of the 2007 discoveries. That points to an exploration program potentially larger than last year's effort, which cost an estimated $6-million.
The Tuktu field lies just 15 kilometres west of Qavvik and several of the pipes in each group are tightly clustered. The size and geometry of each body is still uncertain, but Diamonds North did produce substantial kimberlite intersections from each, suggesting the company could have significant tonnage potential if the pipes make the grade.
Diamonds North closed down nine cents to $1.38 Thursday on 266,500 shares.