Ashton produces more Renard glitter
Ashton Mining of Canada Inc ACA
Shares issued 49,062,149 Dec 19 2002 close $ 1.27
Friday December 20 2002 Street Wire
by Will Purcell
Ashton Mining of Canada and its partner, SOQUEM Inc., received some more good news from their Foxtrot project in the Otish Mountains region of Northern Quebec, with the results of another in a series of small mini-bulk samples from a cluster of kimberlitic bodies. The latest results were from Renard-3, and they were the best yet by far. Ashton now has three kimberlitic bodies that have produced encouraging grades at the mini-bulk stage, and one or two others appear to show promise as well. Although the Renard-3 grade is the best of the results so far, there is no real reason to suspect the result is just a fluke, and there are a few signs of hope that the grades at some of the other pipes might be a bit higher than indicated. As a result, Ashton will likely take larger samples from some of the Renard pipes in the coming months, something that should help sustain its Otish promotion.
Ashton processed 4.88 tonnes of rock from Renard-3, recovering diamonds weighing 6.54 carats using a 0.85-millimetre screen, and that indicated a grade of 1.34 carats per tonne, nearly double what the company had obtained from samples from Renard-2 and Renard-4. There were two distinct phases of material tested at Renard-3, but there was only a slight difference in grade between the two batches, and the sample sizes were too small to say if that difference was anything more than statistical variation. About 3.44 tonnes of kimberlitic breccia produced 4.45 carats of diamonds, for an indicated grade of 1.30 carats per tonne, while 1.44 tonnes of hypabyssal material yielded 2.09 carats for a grade of 1.45 carats per tonne. As well, the grade of the samples did not appear to be skewed by the presence of any particularly large diamonds. The largest stone weighed 0.73 carats, and at least four other diamonds weighed at least 0.20 carat. All that seems suggestive of a healthy diamond size distribution curve, but that is no great surprise considering the initial diamond counts from Renard-3.
Those counts were quite unusual and support the idea of a healthy diamond size distribution at Renard-3. The initial batch of rock produced only 19 diamonds, but several were quite large, and an additional 2,500 fragments, were believed to have been two diamonds larger than three millimetres that had been crushed during the recovery process. As a result, Ashton subsequently processed a second batch, and that continued to show great promise. In all, 206.1 kilograms of rock had contained 83 diamonds, counting the two crushed stones, and 19 of them would have been two-dimensional macros. Those rates pale in comparison with many kimberlites, economic or otherwise, but it was the presence of many larger macros that offered encouragement. In all, the samples produced six diamonds larger than one millimetre in two dimensions, and counting the two broken stones, that worked out to about 40 diamonds per tonne. In addition to the two crushed stones, Ashton did manage to recover a diamond measuring 2.7 millimetres in length in its first batch, and the second sample yielded a four-millimetre stone that weighed an impressive 0.13 carat. As a result, it should be no great surprise that the Renard-3 grade exceeded one carat per tonne; the only diamond deposit south of the Arctic to do so. All that could augur well for subsequent, larger samples from Renard-3. Diamond grades usually increase with larger samples, as larger stones and isolated, higher-grade sections are encountered.
That seems quite likely with some of the other Renard pipes, especially Renard-4, which produced diamond counts that were just as encouraging as its sister pipe. Ashton processed 153 kilograms of rock from Renard-4, recovering 54 diamonds, including 19 two-dimensional macros, numbers that compared well with Renard-3. Only three of the diamonds were large enough to remain on a one-millimetre screen, but one was larger than two millimetres in two dimensions, and a second was nearly three millimetres long. Ashton followed that up with a 4.81-tonne mini-bulk test from the body, and that material produced diamonds weighing 3.11 carats, for an indicated grade of 0.65 carat per tonne. Once again, there were some larger diamonds in the mix, but none were sufficiently large as to skew the result. Four diamonds weighed at least 0.25 carat, but the largest stone was just 0.32 carat, and that result offers hope that Ashton was actually a bit unlucky with its sample. As a result, it would be no great surprise if a larger sample from Renard-4 produced a higher grade than the initial batch of rock, perhaps in excess of one carat per tonne as well, with a bit of luck.
Meanwhile, the Renard-3 result would seem to increase expectations for the grade at another Renard pipe that has not yet been mini-bulk tested. Renard-5 lies under a small lake, which prevented the collection of a larger sample earlier this year, but such a test is clearly in the cards once the ice is sufficiently thick. The initial diamond counts from Renard-5 were quite similar with what had been obtained from Renard-3 and Renard-4, with a small number of microdiamonds, but an encouraging proportion of larger macros. Ashton processed about 144 kilograms of rock for microdiamonds, and 53 stones were recovered, and 21 of those were two-dimensional macrodiamonds. That was the best proportion of 2-D macros of any of the Renard pipes, which is encouraging. Two of those diamonds were longer than one millimetre in two dimensions, including one that was longer than two millimetres in two dimensions. Renard-5 did have another chance to strut its stuff when Ashton processed another 364-kilogram batch for macrodiamonds, and it did not disappoint, as four diamonds were recovered larger than the 0.85-millimetre cutoff. Three were not particularly impressive, but the fourth stone weighed 0.92 carat, the largest diamond recovered from the Otish Mountains to date. That haul, combined with the initial microdiamond results, would seem to place Renard-5 among the better four of the eight Renard bodies that have been discovered to date.
Meanwhile, Ashton is waiting for the results of a second small test form Renard-2, one of its first two finds in 2001 that triggered a surge in speculative interest surrounding the Otish Mountains play. It was just a year ago that Ashton brought its first microdiamond counts to the market, and Renard-2 produced a sufficient parcel to excite the market. Unlike some of its Renard sisters, the pipe yielded a significantly larger number of microdiamonds, and a lower proportion of two-dimensional macrodiamonds, although the numbers and sizes of the largest stones were enough to offer encouragement. That hope was supported this spring, when Ashton recovered diamonds weighing 1.69 carats from a 2.44-tonne test, for an indicated grade of 0.69 carat per tonne. The largest stone weighed just 0.16 carat, but there were six diamonds that weighed at least 0.10 carat. That result could be indicative of a less favourable diamond size distribution curve, but it could also have resulted from a bit of bad luck. Ashton should soon have some additional answers about that, as it is awaiting the result of a further 1.8 tonnes of material.
Ashton now has three kimberlites in its Renard cluster that have promising grades, along with a fourth that could well be its match, but only larger samples will provide an accurate indication of the grade of each body. Ashton has traditionally taken samples of a few tonnes from its promising kimberlites in Alberta and the North, and then followed those up with samples weighing roughly 10 tonnes, if the results warranted it. Only one of its pipes managed to pass that muster, K-14 in Alberta, and it was subjected to a 480-tonne test. Ashton is likely still well away from that stage, but the company will likely consider a series of mini-bulk tests of up to 20 tonnes, based on the results to date.
Just when Ashton might consider such a step is unknown at this stage, as the company is still mulling over its plans for 2003. The partners say they plan "an aggressive exploration program for 2003," and a series of larger samples would clearly meet that bill, although Ashton might consider a program of additional delineation drilling on at least some of the pipes at this stage. One of the knocks against the company's Renard cluster is the fact that the bodies appear to be on the small side, and the company might decide that determining just how much rock is present in each would address a greater uncertainty than coming up with a better idea of the grade of each, at this stage at least. Nevertheless, it seems likely that Ashton will ensure it has enough new samples to process to satisfy the market's expectations.
One of those samples might come from Renard-6 as well. The body did not produce an initial diamond haul that was quite the match for its wealthier sisters, but a subsequent 457-kilogram batch of rock did yield a 0.26-carat diamond. That sample is far too small to produce an accurate indication of grade, although speculators armed with calculators and enough interest had undoubtedly arrived at 0.57-carat-per-tonne result. The results from Renard-6 and Renard-7 do seem to offer enough hope that Ashton will likely poke a few more holes to get a better handle on their actual diamond content. Meanwhile, Renard-1 and Renard-8 may not have shown enough to se much more work in the immediate future at least.
The latest Renard results took Ashton's stock on a ride Thursday. The stock traded up 20 cents to an intraday high of $1.45, before closing up two cents, at $1.27, its low for the day. Despite the string of encouraging results from the Otish Mountains project, Ashton's stock as been struggling of late, and that might play a role in determining the company's nest steps in the region, as most of the promising results have now been received. |
