kidl,
More WSP in the media....courtesy of Willp on SW....
Courtesy of Rapaport's site:
rapaport.com
Snap Lake Find
By Matthew Hart
In the wake of the amazing deal between Aber Resources Ltd., of Vancouver, and Tiffany & Co., the obvious question is — can it happen again? Tiffany's scored a major breakthrough by becoming the first retailer to establish a pipeline of its own straight into the rough supply, bypassing the Central Selling Organization (CSO) by a country mile. It got there by buying a 14 percent stake in Aber and acquiring the right, as many insiders believe, to "cherry-pick" the best stones out of Aber's share of production when the Diavik diamond mine turns on its tap in 2002. Other retailers with money in their pockets will now be asking if they should be looking for a deal of their own. If the answer is yes, they might want to start by calling directory assistance in Vancouver and getting the number for Winspear Resources.
This summer Winspear announced the results of its bulk sampling program at Snap Lake in Canada's Northwest Territories. The Snap Lake property lies 90 miles south of the Ekati diamond mine, which went into production last October and will produce four million carats of rough a year at an average price of $130 a carat. Ekati rough has been well received in Antwerp. (The Diavik diamond mine, in which Tiffany & Co., now has an interest, is south of and adjacent to Ekati.)
A small sample of 200 tons of ore taken from Winspear's property last year was valued at slightly more than $300 per carat, but the full sample of 6,000 tons fell short of this mark. The company recovered over 5,000 carats, and Antwerp valuators pegged the parcel at $105 per carat. One senior mining analyst, David James, was upbeat about the result: "All said, we think we have a new diamond mine for the Northwest Territories," he predicted. James is a vice-president of Canaccord Capital, and a close observer of diamond stocks.
In early July, I arrived in Yellowknife, capital of the Northwest Territories, for a flight into one of Winspear's exploration camps. At 5:30 a.m. Winspear collected me in a pickup, and a few minutes later we bumped through the gate at the airport and pulled to a halt in front of a twin-engined aircraft, revving up its engines on the tarmac. They wedged me into a canvas seat just behind the cargo door, and we took off.
An hour later the plane circled a sandy ridge, then dropped down for a landing. No sooner had I climbed out than a Jet Ranger helicopter clattered onto the esker and a short figure with flying hair tumbled out, ran at a crouch beneath the whirling rotor, and seized me firmly by the hand. Jennifer Irwin is the geologist in charge of Winspear's Hilltop camp, where the helicopter dropped us after a short flight. Two rows of neat, white tents stand on a point of Lac Nez Cloche. Irwin led the way into the office tent.
“We think we have a wash of pyropes through the whole property from up ice,” Irwin told me, rolling out a map and tracing a line through the block of claims that Hilltop camp was established to explore. Pyropes are a kind of garnet associated with diamond deposits. “Up ice” means the direction the last glacier came from when it covered the land. A glacier is said to flow “down ice.” Glaciers gouge out material as they go, and dribble it out here and there. If you find such material, its source will therefore lie “up ice.”
We climbed back into the helicopter and whisked away from camp. Soon we spotted a bright red backpack, then another, and the pilot found a patch of open ground to land. The backpacks belonged to Nick Pokhilenko and Dave Clarke, who'd been sampling below a ridge, or uplift, a geological fault in the ancient granite cap that covers this part of the world. Russian diamond geologists like to look near faults, and Pokhilenko is a Russian diamond geologist of the first rank. He has found five diamond pipes in Siberia. Gorbachev decorated him, and presented him with a cash bonus that was "enough to take three friends to dinner." Yeltsin decorated him too, but cut the cash to zero. He'll do better in Canada. Winspear's CEO, Randy Turner, brandishing stock options and hard currency, lured the Russian to the company's claims, where he has put in several months a year since 1994.
Armed with spades and white plastic buckets we trudged off over the rocky ground and into a grove of spruce. The ground was boggy and wet. Mosquitoes attacked us in clouds. Three of us pulled on bug hats — fine-meshed nets that hang around your head. Pokhilenko preferred mosquito repellent, drenching himself with spray every five minutes.
The geologists were looking for basal till, a sandy soil studded with fragments of rock. Basal tills are composed of material that has been transported only a short distance by a glacier. The source of the fragments should therefore be nearby. If the fragments contain pyrope garnets, then a diamond deposit could be close at hand. "The ice was coming at us across that lake," says Clarke. "Now we're sampling to see what we can pick up."
To concentrate samples in the field, Russian geologists “pan” the soils – sloshing them around in hand-carved wooden troughs and washing away the lighter soils. It's a system that relies on personal skill, "like playing a violin," says Pokhilenko. North American science tends to be suspicious of such methods, and the wisdom of panning is one of the issues Melissa Kirkley, Winspear's new chief geologist, must sort through. Kirkley, an American, is a well-known diamond geochemist, and a former doctoral student of John Gurney, the South African superstar of diamond indicators. "So far the system has worked well for us," Kirkley says of Winspear's field sampling. "I want to take a methodical look at it, but I'm convinced it does work well. We might want to do more tests to quantify what's been recovered and what is lost by the pans, but I think we'll be sticking with the system."
One morning we helicoptered over to Snap Lake, the site of Winspear's discovery. Piles of crumbly gray kimberlite — the common host rock of diamonds — lay all around. When Winspear brought Pokhilenko here in 1994, the Russian was more or less handed a map of the 2,500 square kilometres of claims, given the direction of the ice, and asked what he thought. "I had never seen geological conditions like these. The most important task is to construct in your head what happened geologically. Then you think — what do I need to know to find this bloody kimberlite?" In two days he isolated three small targets. A day and a half later they found the deposit, coming upon a train of indicator minerals with "big, purple pyropes like the end of your finger."
While the overall value of the Snap Lake sample is $105 per carat, the inclusion of larger stones might make a few mouths water on West 47th Street. There were 191 stones larger than three-carats, and nine specials. If there are other Tiffany's out there with an appetite for rough, one of the factors in Winspear's favor is its lack of a senior partner — a large mining company with the right to call the downstream shots. The only question still hovering in this writer's head is — if retailers start buying into mines, how long before De Beers starts buying retailers? |
