Ashton finds a bit of sparkle at Stellaria
Ashton Mining of Canada Inc ACA
Shares issued 49,062,149 Jul 18 close $2.45
Thu 18 Jul 2002 Street Wire
by Will Purcell
The Kikerk Lake Stellaria kimberlite is diamondiferous, but speculators
might have to dig a bit deeper to find any real signs of hope from the
result. The kimberlite was discovered earlier this year by Ashton Mining of
Canada on the Kikerk Lake property in southwestern Nunavut, and although
the raw diamond counts were a bit disappointing, Ashton and its partners
are expected to test the find further, in the hopes of coming up with a
better result. As well, Stellaria offers hope that additional,
significantly diamondiferous kimberlites lurk on Ashton's ground in the
Coronation district.
Ashton sent 105.4 kilograms of Stellaria kimberlite off to its laboratory
for processing, and the company recovered 79 diamonds, or about 750 stones
per tonne. Included in that haul were 13 macrodiamonds, or about 125 macros
per tonne. Those numbers were not particularly discouraging on their own,
but the lack of any larger diamonds was clearly a disappointment. Just one
of the macrodiamonds was large enough to remain on a 0.5-millimetre screen,
which suggests a rate of just 10 two-dimensional macrodiamonds per tonne,
and none of the diamonds were longer than one millimetre, as the largest
stone apparently measured just 0.8 millimetres in length.
Stellaria is just 700 metres to the east of the Potentilla kimberlite,
which was discovered last September on ground the company shares with
Northern Empire Minerals and Caledonia Mining. Ashton processed about 208
kilograms of Potentilla kimberlite, coming up with 252 diamonds. That
parcel included 22 macro-sized stones, 10 of which were longer than 0.5
millimetre in two dimensions. Three of the diamonds were longer than one
millimetre, including one that was big enough to remain on a one-millimetre
screen. That stone was 2.13 millimetres long, which was the largest diamond
Ashton had recovered from any of the initial samples of its Coronation
kimberlites.
The Potentilla result was significantly better than the Stellaria counts,
but still, there is perhaps a bit of encouragement to be had from the
numbers. Drilling on Potentilla indicated two distinct phases of
kimberlite, and they appeared to have significantly different diamond
counts. The upper portion of Potentilla contained a kimberlite breccia,
which was above a zone of hypabyssal kimberlite. That hypabyssal zone at
Potentilla produced diamond counts that were only slightly better than the
Stellaria numbers. A total of 78.7 kilograms of the material produced 77
diamonds, about 975 stones per tonne, which was just marginally more than
had been found in Stellaria. Just seven of the diamonds were macros, a rate
of about 90 macro-sized stones per tonne, and that was less than Stellaria
had produced. Three of the Potentilla diamonds were longer than 0.5
millimetre in two dimensions, or just less than 40 per tonne. That was
better than the Potentilla result, although the sample is far too small to
make the result particularly meaningful. The largest of the Potentilla
macros measured just 0.8 millimetre in length.
Things were significantly different with the breccia at Potentilla. Ashton
processed 129 kilograms of the material, coming up with 175 diamonds, a
rate of about 1,350 diamonds per tonne. There were 15 macros in the mix, or
about 115 stones per tonne. Both of those figures were significantly higher
than what had been present in the hypabyssal material, but it was the
presence of larger diamonds that seemed especially encouraging. Seven of
the diamonds were two-dimensional macrodiamonds, and that worked out to
about 55 such stones per tonne. Furthermore, all three one-millimetre
diamonds in the Potentilla samples had come from the breccia material, and
that worked out to nearly 25 stones per tonne. Although just one of those
diamonds was large enough to remain on a one-millimetre screen, the two
others narrowly missed the mark, and all that would seem to suggest that
the breccia at Potentilla has a significantly higher diamond content than
the lower, hypabyssal phase.
That might be good news for Stellaria, where the initial sample was
determined to be hypabyssal kimberlite. Better diamond counts could be
lurking elsewhere in the body, if subsequent drilling encounters a breccia
layer, or another phase of kimberlite with a higher diamond content. Just
what the chances are of that are is hard to say. The fact that a breccia
layer was not encountered in the upper portion of the first drill hole
might be a bad sign, but only more drilling will tell for sure.
At this stage the Stellaria kimberlite does not appear to be particularly
large, which is also not a good indication. The anomaly is about 160 metres
long and 50 metres wide, and a vertical hole into the feature encountered
about 40 metres of kimberlite, beginning at a depth of about 55 metres. A
much more encouraging sign is that Stellaria occurs on a geophysical
feature that is about two kilometres in length, and a portion of the
feature is up-ice from a train of kimberlite indicator minerals. That train
may well indicate that there is more kimberlite to be found along the
linear feature, and Stellaria might well prove to be a kimberlite dike with
a considerable strike length. Dike or not, with a significant number of
G-10 garnets in the train, it could bode well for the diamond content of
the kimberlite source of the minerals.
Meanwhile, drilling on the Potentilla anomaly would seem to suggest that
the kimberlite body is small as well. The kimberlite has a maximum surface
area measuring 110 metres by 50 metres, and several drill holes produced
kimberlite depths varying between 55 metres and more than 200 metres. All
of that would suggest that Potentilla is a small kimberlite, containing
perhaps a few million tonnes of kimberlite. Nevertheless, Ashton had enough
hope for Potentilla that it collected a 5.5-tonne sample of kimberlite for
macrodiamond recovery. That mini-bulk sample will provide the first real
indication of the grade of the body, and it will also provide a much
clearer picture of the different diamond content and size distribution
between the breccia and hypabyssal material.
Ashton is also completing a mini-bulk test of the Artemisia kimberlite,
located about 15 kilometres west of Potentilla, and the results of the two
samples will probably have a significant impact on the market's faith in
Ashton's Coronation project. The Artemisia kimberlite produced better
diamond counts than any of Ashton's finds in the Coronation region,
although a larger sample quickly cooled a developing diamond fever. The
company initially processed 332 kilograms of Artemisia kimberlite,
recovering 1,241 diamonds. That was about 3,750 stones per tonne, and the
120 macros recovered worked out to about 360 macrodiamonds per tonne of
Artemisia kimberlite. There were 38 two-dimensional macros in the Artemisia
sample, or about 115 stones per tonne.
Those counts were much higher than that which Potentilla and Stellaria
delivered, but there was no real sign that larger diamonds would be
abundant at Artemisia. Four of the diamonds were longer than one
millimetre, and two of them were larger than one millimetre in two
dimensions, but that was no better than what the breccia phase of
Potentilla had delivered. Although the sample sizes are too small to place
much meaning on the results, the numbers would offer some hope that
Potentilla might have a modest supply of larger diamonds, at least in the
breccia phase.
Ashton subsequently collected a 1.16-tonne surface sample from Artemisia,
and that rock produced diamonds weighing 0.20 carat, which indicated a
grade of 0.17 carat per tonne. That was not encouraging, and the result
sent Ashton's stock into a tailspin. The company's promotion had peaked in
early February at $4.65, but the Artemisia test helped drive Ashton's
shares back below $3. Although investors were falling off the bandwagon in
droves, the Artemisia sample was far too small to be meaningful, and Ashton
collected 11 more tonnes of material this spring by drilling. The results
of that program are expected soon, and they will provide a somewhat clearer
picture of the grade at Artemisia.
Ashton is also waiting on diamond counts form a second recent kimberlite
find in the region. The Thrift kimberlite was discovered this spring, about
2.5 kilometres to the southwest of Artemisia. Like the other finds, Thrift
appears to be quite small, measuring about 100 metres in diameter.
Nevertheless, elevated macrodiamond counts from Thrift and a better grade
from the Artemisia sample would be good news for Ashton and its
10.6-per-cent partner on the Kim property, Pure Gold Minerals. If the
diamond counts warrant the work, conducting an initial mini-bulk test of
Thrift should not be a difficult proposition, as the kimberlite outcrops on
surface, much like at Artemisia. As a result, Ashton might well be tempted
to bang off a quick, one-tonne sample of Thrift kimberlite, to obtain a
first indication of its macro content.
Although it will be the advanced exploration programs at Artemisia,
Potentilla and the two new finds that will largely drive the market's
interest in Ashton's Nunavut diamond play, the company is expected to
direct a considerable amount of its attention to the discovery of new
bodies on its large land holdings in the region. Ashton has several
promising trains of kimberlite indicator minerals that it is attempting to
find a source region for, and surface sampling programs are expected on
some of the newly acquired ground, in the hopes of finding more mineral
trains.
That work could prove to be significant in a region that has produced one
or more clusters of kimberlites. A significant number of the discoveries in
the Coronation region have proved to be diamondiferous, and there are signs
that several of them have diamond grades in excess of 0.05 carat per tonne.
Although such a grade would certainly not be economic in Nunavut, very few
of the kimberlites in the world have such a grade. As a result, most
explorers involved in the Coronation play remain optimistic that the
results suggest that the first economic deposit will soon be found.
The market also seems hopeful, although not to the same extent as early
this year. Ashton's shares jumped eight cents on the news Wednesday, to an
intraday high of $2.60, but the stock has since given back the gains,
closing down four cents Thursday, at $2.41. |
