Ashton Mining of Canada Inc -
Ashton finds new sparkle
Ashton Mining of Canada Inc ACA
Shares issued 29,249,415 2000-07-19 close $0.78
Thursday Jul 20 2000
by Will Purcell
Just when it seemed that the Alberta diamond play had finally run its course, Ashton Mining of Canada Ltd. has managed to pull another rabbit out of its hat. The company has released a new batch of microdiamond recovery results from three kimberlite pipes discovered several months ago. One of those kimberlites was barely diamondiferous and a second was not much better, although the presence of a larger macrodiamond was at least a little bit intriguing. However it was the third pipe, K-252, upon which Ashton and its joint venture partners are likely to hang their hopes for the coming year.
A sample weighing 65.5 kilograms taken from kimberlite K-252 was found to contain 106 diamonds, of which five were macrodiamonds. At least two of those macros were fairly large for such a small sample, exceeding one millimetre in length. The largest was 2.35 millimetres long and 2.19 millimetres wide, although it was only 0.63 millimetres deep. Such a stone might have a weight around 0.025 carat, depending on its shape. A second diamond probably had a quite similar weight, and it may be octahedral in shape. That stone was almost 1.7 millimetres long, again a substantial diamond for such a small sample.
The K-252 pipe contains two distinct phases of kimberlite. The current results represent the kimberlite breccia portion of the pipe, and microdiamond recovery results from a 45-kilogram sample of medium-grained volcaniclastic kimberlite are expected next month, and what the diamond population of that phase will be is anybody's guess at this stage.
Ashton and its partners gleefully noted that the results from K-252 were among the best obtained from the 35 kimberlites discovered thus far on the joint venture ground. Although the sample size is very small, that comment appears to be a bit of an understatement, as at a similar stage, no other Alberta pipe possessed such large diamonds.
Based on the very small sample taken from just one phase, pipe K-252 contained 1.6 diamonds per kilogram, which indeed does rank among the best of the Alberta results. Only K-91 returned better results. A 117-kilogram sample taken from that kimberlite had contained 1.64 diamonds per kilogram. The pipe once believed to me the most prospective, K-14, contained about 1.2 diamonds per kilogram, not counting a sample that contained a large proportion of fractured microdiamonds, and only 0.6 stones per kilogram were found in K-11.
The total diamond count is often an unreliable measure of the economic potential of a pipe, and the frequency of larger stones is usually a far better indicator. The macrodiamond count from K-252 appears good, with 76 macros per tonne. Pipe K-14 contained just 54 macros per tonne, while K-11 had 74 similar sized stones per tonne. Again, the results from K-91 were superior to all of the pipes, including K-252, with 103 macros per tonne.
It is at the still larger sizes that K-252 begins to look even better. The small sample contained two stones large enough to be recovered in a bulk sampling process, and they were probably sufficiently large to be considered commercial-sized diamonds. A sample nearly twice as large was taken from K-91, with only one macro found that just exceeded one millimetre in length. Three one-millimetre stones were recovered from K-11, with the largest measuring 1.7 millimetres in length. The K-11 sample was about three times larger than that taken from K-252. The largest diamonds previously found at the caustic dissolution stage previously came from K-14, where at least three diamonds exceeded one millimetre, with two measuring about 2.5 millimetres in length. The K-14 samples weighed about five times more than the K-252 kimberlite, however.
The combined weight of the two largest diamonds and the third macro taken from K-252 might well be about 0.05 carat, which would indicate a theoretical grade of about 0.76 carat per tonne. Although grade calculations for samples smaller than a several tonnes are wildly inaccurate and quite meaningless at this stage, the results do show that the K-252 sample contains an intriguing array of diamonds. Even if a further 240-kilogram portion of kimberlite were barren, the grade from the new pipe would still equal the best results from any of the mini-bulk samples.
The encouraging result is far from a sure thing, however, and Ashton and its partners have been down this road before. Last year, Ashton announced that a 96.4-kilogram sample taken from BH-225 had contained 72 diamonds, including five micros. Two of those micros exceeded one millimetre in length, although the other two dimensions were just over 0.5 millimetre. These results, although not as good as K-252, were certainly pleasing. Ashton set to work, collecting about one tonne of kimberlite from the pipe and sending it to its dense media separation plant in North Vancouver. The results, announced a month ago, effectively killed the pipe. A total of 990 kilograms of kimberlite contained only 0.035 carat of macrodiamonds, for an effective grade of 0.035 carat per tonne. The two largest diamonds, which likely accounted for almost all of the diamond weight, were both about two millimetres in length.
Nevertheless, the Alberta diamond play appears to have a new lease on life, if only for another year. Ashton announced that further drilling and sampling would be completed to assess the size and diamond potential of the pipe. If that additional drilling continues to result in the recovery of larger macrodiamonds, the pipe may well be slated for mini-bulk testing later this year.
Meanwhile, the results from K-8 were certainly curious. A total of 274.2 kilograms of kimberlite was collected from the body, but only five diamonds were recovered. One of these diamonds was a macro, and it well may have been the largest macrodiamond recovered by Ashton this year. The stone was 2.3 millimetres in length, and the remaining two dimensions also exceeded one millimetre by a healthy margin. Despite the presence of the larger diamond, K-8 is unlikely to see much in the way of further exploration, due to the poor overall diamond count, which seemingly indicates that the larger stone was a bit of a fluke.
The third pipe evaluated was kimberlite K-160, which contained just two microdiamonds in a sample that weighed 45.9 kilograms. With such a low diamond count and the absence of macro-sized stones, further work on this kimberlite is highly unlikely.
If K-252 continues to provide encouraging results, there is likely to be renewed pressure to find additional kimberlites in the area. The body is not large, with a surface diameter estimated at about 150 metres. The pipe might contain about 15 million tonnes of kimberlite to about 300 metres, which is unlikely to be sufficient to support a mine in any case. If it were to contain economic values of diamonds, the previously bulk tested K-14 might well get another look, in search of higher-grade sections.
As a result, additional prospecting in the general area surrounding K-252 is likely. That region hosts the better pipes found to date, including all of the pipes that were mini-bulk tested, except K-11, which lies about 30 kilometres to the east. Whether that work will identify any new pipes is another matter entirely, as the bulk of Ashton's efforts have been concentrated in that region, and all of the obvious targets have already been tested. Nevertheless, there may just be one or two more tucked away, containing enough diamonds to keep the Alberta diamond play alive for a few more years.
Many investors who regularly follow the Alberta project continue to keep the faith, despite the continual disappointments that have flowed from the Buffalo Hills. Ashton's stock remained mired near the 60-cent mark for the last half of 1999, but rallied through the winter, hitting a high of $1.50 early in March, coincident with the discovery of the three new pipes. Since then, the stock has retreated back to the levels of last year, testing 60 cents early last week. Ashton has recovered in recent days and gained another eight cents after the news Wednesday, closing at 78 cents. |
