Research Report- from the Research Department of Wolverton Securities
by Tracy Hurley M.Sc., M.B.A., P.Geo., Mining Analyst- March 1, 1999.
Troymin Resources Ltd. (MSE:TYR)
Shortly after recommending TYR last April, Monopros Limited (Canadian subsidiary of De Beers) entered a joint venture with the company to earn up to 60% interest in their 1 million acre package of properties in the Buffalo Hills area, northern Alberta. Over the summer field season, Monopros completed detailed mapping, geochemical sampling and detailed helicopter geophysics over 23 (considered highest priority) of the 300 delineated airborne targets.
Based on the results, Monopros selected 3 drill targets on the Bison Lake block and 1 target on the Muskwa Lake block and commenced drilling in January. Only 3 holes were completed; unseasonably warm weather conditions prevented access to the third Bison target. Failing to intersect kimberlite in the 3 holes, Monopros decided to terminate its agreement with TYR prior to the February 28 anniversary date.
The Bison Lake and Muskwa Lake blocks lie north and south respectively of Ashton Mining's main kimberlite discovery block. Ashton has discovered 26 kimberlites in the Buffalo Hills area to date, 17 of which are diamondiferous. The results of one bulk sample (K-14 kimberlite) and 5 mini-bulk samples (K-5, 6, 11, 14 and K-91 kimberlites) on Ashton's ground have so far been uneconomic. However, Ashton remains encouraged by the overall prospectivity of northern Alberta for diamonds, as reflected in their $7.4 M exploration budget for 1999.
Monopros' withdrawal after only three drill holes is surprising, especially given the persistence demonstrated by other industry experts in the Buffalo Hills area. The work completed to date will keep the majority of the permits in good standing for a couple of years, thus enabling TYR to further evaluate the properties themselves and/or seek another joint venture partner.
TYR announced in early January it had acquired 5 blocks of ground totalling 35,200 acres in the vicinity of the Teck-Sumitomo Pogo deposit (geological resource of 10 M tons @0.52 oz./ton or 5.2 M oz.), 140 km ESE of Fairbanks Alaska. The company is planning a first pass prospecting and geochemical survey for the upcoming field season.
TYR is also planning a trenching and/or drilling program on its Prospector Mountain, Yukon property (joint venture with Almaden) to follow up on 2 areas of anomalous gold-copper-molybdenum-silver mineralization and coincident chargeability anomalies.
TYR had been trading in the $0.30–$0.40 range prior to Monopros' withdrawal from the Buffalo Hills joint venture. The stock subsequently dropped to $0.15–$0.20 on relatively light volume. The Alberta diamond play is far from over, although renewed speculative interest won't happen until better results are obtained. The Pogo play is anticipated to heat up with the upcoming field season. With over $1.8 M in cash and upcoming field programs, TYR is still recommended as a Speculative Buy at current prices.
Contact: Tom Boychuk (604) 681-7610 or 1-800-557-1545
Jack McCleary (403) 298-0252
E-mail: troymin@troymin.com
Website: troymin.com |
