From e-mail (w/ permission): "April 11/98 -- The RESOURCE INDICATOR has issued an April 7, 1998 Situation Alert on Marum's recent news release (see below, reproduced with permission). They are also offering a free month trial offer as shown below."
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SITUATION ALERT THE RESOURCE INDICATOR
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Vol. 2, No. 18 Staking VALUE early
April 7, 1998
MARUM RESOURCES INC. marumresources.com
The Alberta Geological Survey report "Diamonds in Alberta" outlines
the potential of the Chinchaga and Hearne terrane to host diamonds.
Marum has a position in approximately 1.3 million acres in northern
and southern Alberta.
DECLARATION: I established a small position following the initial
write-up on March 6, 1998. Following the one week wait period, I
will accumulate more on dips.
ACCUMULATE ON DIPS (MMU.a/$0.275)
Recent Write-Up: March 26, 1998 (MMU.a/$0.23)
Recent Comments: Accumulate
Recent High/Low: $0.30/$0.20
Trailing Mental Stop Loss: $0.20
Marum and joint venture partner Caribgold (CG.t/$0.69) released an
exploration update from the Chinchaga Diamond Project in Alberta
yesterday afternoon. It is clearly the best progress to date from any of
the area juniors. Diamond exploration is a very slow process but it is
even slower when planned in a hurry, as learned by some of the other
area juniors. So far, the first stage of exploration appears to be a
success as Marum and Caribgold will clearly increase their knowledge
base at a fraction of the cost of other area juniors.
DEDUCTION VS. OBSERVATION
It is obvious that the release has been very carefully drafted. This in
itself should tell you that the partners are optimistic but cannot
honestly conclude the intersection of kimberlite or volcanic material.
One will have to read between the lines if one is to extract any
information for use in order to make an informed decision on any
further speculation. What I pick up from the release is outlined below.
* Marum only staked land which they believed prospective for
kimberlite and which had the opportunity to intersect bedrock at
shallow depths. The maximum depth of overburden encountered
was 9.4 metres. This gives me some confidence that Marum's and
the project consultant's (Apex) experience in the area will prove to
be a valuable asset as they move forward.
* As indicated in the March 6, 1998 Situation Alert, Cretaceous-age
beach sands, now sandstones, in the area, have shown some
evidence of diamonds and associated indicators in the past. The
drilling indicates that Cretaceous-age shales, sands and mudstones
were intersected. Although the release does not document any
observation of indicator minerals, I speculate that Olivine and
Pyropes will be found in the samples. Marum has been active in
the area since 1994 and has found such indicators in the past.
* The Ashton kimberlites are believed to be approximately 80 to 90
million years old. The release appears to imply that MMU has
intersected rocks of the same age period and of similar character.
This moves us a step closer towards saying that the Chinchaga and
Buffalo Hill regions may be very similar geologically and thus
hold the same potential.
* Three targets, in one cluster, yielded multiple thick pyroclastic ash
horizons up to 2.5 metres thick. I speculate volcanic activity as the
source of the ash. In this region, the compression ratio is believed
to be approximately 5 to 1. The maximum total observed ash, not
counting the "sand" ash, was about 5 metres. This means that the
ash intersected measured approximately 25 metres thick at one
point. Numerous thick intersections also indicated that the source
of the ash is in the area.
* The above three targets also intersected 'green sands'. Weathered
kimberlite, in a wet environment, provided the weathering is not to
intense, can look like green clay. This weathering, or alteration
can occur at depth. The release also suggests that these green
sands occur at various depths in the three targets. If this is true,
the location of the green sands, within the cores, suggests a very
active and complicated geology which is consistent with a periodic
volcanic source vent. I have contacted the company and have been
informed that the unofficial consensus is that the green sand is
really an "accretionary lapilli" ash dump which is represented by
green ash balls formed when thunderstorms rains trough thick ash
clouds on the slopes of erupting volcanoes. The entire section in
the holes appears, based on very preliminary interpretation, to
represent a typical volcanic "tuff ring" sequence of a base mud
deposit, overlain by pyroclastic fine ash deposits, which are in turn
overlain by a very thick (up to 5 metres) lapilli bed.
* Target six yielded 133 feet of core and is in the same cluster as
target seven (believed to be 4 km away). In the March 6, 1998
Alert, I indicated that the auger drill can go as deep as 150 feet in
loose sandstone, up to 75 feet in crater kimberlite and three feet in
diatreme kimberlite. As indicated above, even if the whole
intersection consists of sandstone, the sandstones in the area have
shown some evidence of diamonds and associated indicators in the
past. The analysis of this core should also provide the joint venture
with some clues towards the understanding of material encountered
in target seven.
* Target seven, which is in the vicinity of the three above mentioned
targets, intersected some bedrock impenetrable by the auger drill in
two holes. The 'impenetrable' bedrock cannot be a boulder as the
holes were ten metres apart (and besides, there are no known large
boulders in these rock units). Also worth noting is that the hard
unit lies under green-black sands. At the depth indicated, volcanic
material is the only explanation I can come up with. Also, as noted
in earlier Alerts, the host kimberlite in Alberta is denser than the
surrounding sandstones and thus harder to drill through, especially
with an auger drill. These are speculative comments at this point
but we will know the truth in the next stage of drilling as this will
most likely be a priority target.
* The distribution of pipes in the Alberta play are believed to be
primarily related to the crustal structures of the Peace River Arch.
Core recovered from the targets can be tested for evidence of deep
crustal origin. Evidence of this will attract more investors to the
area.
* The original targets were defined using existing, widely spaced, oil
company airborne magnetic surveys (in addition to other
information). The 200 metre grid will allow the joint venture
partners to fine tune their target selection process. The air mag
survey is expected to be completed by the end of the week and
covers the current area of interest, 100% Marum land, and the
Marum/Micrex (MIX.a/$0.52) joint venture. Interpretation of the
data takes approximately two weeks.
Cores will be split and all "volcanic" sections will be analysed. The
ash is washed with an oxidant (to prevent the clays from swelling) and
screened to trap any solids. A chemical analysis will also be
conducted on small portions of the Ash. Target seven yielded about 7
metres of till, including a basal till, and about 13 metres of green sand
and mixed mudstones. This material will also be analysed.
The results from the lab are expected in approximately three to six
weeks. Positive results from this analysis has the potential to
challenge the mainstream. In the February and March Alerts, I went
through a logical thought process to show that, contrary to popular
views, the Chinchaga region cannot yet be ruled out for diamond
prospectivity. I believe the results will show that volcanic activity has
taken place in the area. It also has the potential to challenge the
mainstream through the discovery of indicator minerals and the
presence of diamonds. This is a very speculative comment but is also
backed by the past discovery of indicator minerals and two diamonds
in sandstone.
ACTION OVER WORDS
Marum is the leader in the area and has been highlighted due to
management experience and a technically sound, financially
responsible exploration project. With this news release, the action of
the joint venture partners speak louder than the words. The
conservative operator has taken an aggressive approach towards the
next stage of exploration. The 200 meter Air-Mag survey was
approved and commenced prior to any results from the lab. This will
not only give them the needed information required to select the next
round of priority targets, but will maintain their leadership role in the
area. Only Marum, CaribGold, and Micrex will have an analysis of
drill cores representative of the area to include in their decision making
process.
The partnership will also employ two drills for the next stage of
exploration. This again should give them an edge over the other
players in the area and allow them to drill a large number of targets.
The auger drill can conduct the initial scout drilling with the rotary
drill used to follow-up on any encouraging results.
>From their action, it is clear that the joint venture partners are putting
their, and thus shareholder, money behind their quiet optimism. Other
area juniors such as Mount Hope (MH.a/$0.52) and Pure Gold
(PUG.t/$1.00) are also flying their properties in the region.
With the general mining market showing signs of improvement, the
next stage of exploration by the area juniors in Alberta should be able to attract a significant amount of speculation. Some of the best, and
yet untested, targets exist on 100% Marum land. The next stage of
drilling will not only generate a higher expectation of success, but also
leverage success due to 100% owned targets and a higher market
profile.
With 30% insider ownership and a current market capitalization below
$9 million, MMU is highly leveraged to any success in the program.
Management also has near term incentive to perform as most of the
outstanding options and warrants are held by insiders with prices
ranging from $0.12 and $0.40. Under the right conditions, these
options and warrants may be exercised to raise some money.
Exploration in the Alberta Diamond Play will reach a feverish pitch
during the summer of 1998. I suggest we continue to participate in the upcoming speculation by accumulating Marum, Troymin and New
Claymore.
Sincerely,
Sudhir Khanna, P.Eng.,
Editor, The RESOURCE INDICATOR
Staking VALUE before others
<<<<>>>><<<<>>>><<<<>>>>
On April 1, 1998, I set up a $10,000 Resource Indicator Performance Portfolio (RIPP). The RIPP will only trade in stocks followed by The RESOURCE INDICATOR. All trades in the RIPP will be announced by E-mail.
___ RIPP Value = $11,675 _________________________________
MMU.a 30,453 @ $0.275 = $8,375
VIN.v 10,000 @ $0.330 = $3,300
---------------------------------------------------------
___ RIPP Transactions ___________________________________
MMU.a April 1/98 Buy 30,453 @ $0.23 $7,000
VIN.v April 1/98 Buy 10,000 @ $0.30 $3,000
______________________________________________________
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FREE ONE MONTH TRIAL OFFER
RESOURCE INDICATOR Benefits:
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I don't make money.
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* Risk managed accumulation strategies.
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* Every write-up is updated at least once per month.
* Free timely SITUATION ALERTS issued on any significant
news or developments.
* The Editor is available to answer subscriber questions.
Please visit:
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for more information.
<<<<>>>><<<<>>>><<<<>>>><<<<>>>><<<<>>>>
As always, you can E-mail me at khannas@interlog.com with any
comments or questions.
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TRI offers a well thought out and written analysis, don't ya think?
-j
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