Who’s Up Next?
The race to find new diamond-bearing kimberlitic pipes remains in full force all over the world. However, perhaps nowhere is it more active than in Canada, which has maintained its position as one of the most promising new locations for diamond mining. Everyone from De Beers right on down to junior mining companies has staked claims all over the Great White North. In fact, according to the Northwest Territories Department of Resources, Wildlife and Economic Development there are over 60 prospecting areas across Canada in which diamond exploration is taking place. Diamond giant De Beers has indicated that exploration to date — in some cases carried out with joint-venture partners — has led to the discovery of more than 200 kimberlites in 12 different areas of Canada. De Beers estimates that well over half of these kimberlites are diamondiferous. In 2004, over 30 percent of De Beers global exploration budget was spent on the search for diamondiferous kimberlites in Canada.
On the following pages is a roundup of the three sites that are expected to go online in the coming years as well as some of the major exploration projects and the new kimberlite discoveries.
MINING PROJECTS
Northwest Territories (NWT)
Name: Snap Lake.
Location: Snap Lake, approximately 220 kilometers northeast of Yellowknife, NWT, Canada.
Owner: Wholly owned by De Beers Canada.
Investments, Financial: Approximately $136 million has been spent by De Beers Canada.
Expected life: 22 years.
Recent Developments: De Beers received the final regulatory approvals required for the construction of a mine at Snap Lake on May 31, 2004. The mine engineering plan, process plant design and equipment selection is being finalized in preparation for the construction phase. Construction — phase two of the project — is scheduled to begin in early 2005 with site preparation and civil works. Work in 2005 will focus on preparation of the site, which will include major earthworks and the installation of foundations for future infrastructures. Construction is scheduled to be completed in mid-2007; the mine will then be commissioned and production will begin. The mine is expected to reach full production in mid-2008. Once the Snap Lake mine is complete, it will be the first De Beers mine outside of Africa and Canada’s first fully underground diamond mine.
Ontario
Name: Victor Project.
Location: James Bay Lowlands of Northern Ontario, Canada.
wner: Wholly owned by De Beers Canada.
Project Features: Victor is one of 18 kimberlite pipes discovered on the property, 16 of which are diamondiferous. It has a surface area of 15 hectares and consists of two pipes that coalesce at the surface: Victor Main and Victor Southwest.
Investments, Financial: Approximately $80 million has been spent by De Beers Canada.
Expected life: 12 years.
Recent Developments: De Beers hopes to receive approval for the Environmental Assessment in the first quarter of 2005 and operating permits in mid-2005. The company anticipates making a decision regarding mine development in mid-2005, after the permits have been received and an agreement is finalized with the Attawapiskat First Nation. According to the project timeline, construction is scheduled to begin 2005, production buildup in mid-2007 and full production in mid-2008.
Nunavut Territories
Name: Jericho.
Location: Near the north end of Contwoyto Lake in West Kitikmeot, Nunavut Territory (NT), Canada.
Owner: Wholly owned by Tahera Diamond Corporation.
Expected life: A minimum of eight years.
Recent Developments: Tahera announced in early October 2004 that it entered into a diamond purchasing, marketing and project financing agreement with Tiffany & Co. According to the terms, Tiffany will purchase or market all of the diamond production from the Jericho Diamond Project and will provide Tahera with a $28 million loan facility to assist in financing construction of the project. The jeweler will purchase a significant portion for its own manufacturing requirements and will sell the balance of the production on behalf of Tahera in the international market. The agreement extends over the entire life of the project. Tahera will pay no selling or other fees on the diamonds purchased by Tiffany and will share in the diamond manufacturing profits on a formula basis dependent on diamond size. However, Tahera will pay a fee for the marketing of the portion of production that Tiffany does not purchase.
Tahera is targeting completion of all permitting activities for early 2005 in time to utilitze the 2005 winter road for project mobilization. It plans to commence construction of the sites, facilities and the open pit in early 2005. Full commercial production is expected to commence in late 2005/early 2006.
EXPLORATION PROJECTS
Northwest Territories (NWT)
Name: Gahcho Kué.
Location: South of Lac de Gras, NWT, Canada.
Owners: A joint venture between De Beers Canada Exploration Inc., 51 percent; Mountain Province Diamonds Inc., 44 percent and Camphor Ventures, 4.9 percent.
Project Features: Eight diamondiferous kimberlite occurrences have been found on the property, which was formerly known as Kennady Lake.
Investments, Financial: Approximately $66 million has been spent by the joint-venture partners.
Expected life: 15 years.
Recent Developments: The 5034, Hearne and Tuzo kimberlite bodies on the property are currently undergoing a $20 million technical study and are considered potentially economically viable. The study is scheduled for completion by mid-2005. If the project proceeds toward mine development, it is expected that permitting and stakeholder consultation will take an additional three to four years, followed by three years for mine construction. Exploration will also continue to determine the potential of other kimberlite bodies. A detailed project study report will be completed by mid-2005 and will provide information to advance the project to mine permitting — if the project proves economically viable. Also completed by that time will be a full environmental baseline study report that will include stakeholder consultation with the primary affected aboriginal groups, federal and territorial agencies.
Saskatchewan
Name: Fort à la Corne.
Location: 50 kilometers northeast of Prince Albert, Saskatchewan, Canada.
Owners: A joint venture between De Beers Canada Exploration Inc., 42.25 percent; Kensington Resources Ltd., 42.25 percent; Cameco Corporation, 5.5 percent and Uranerz Exploration and Mining (UEM) Inc., which carried 10 percent.
Project Features: The claim covers 63 of the over 71 kimberlites found in the area, which together form one of the largest diamondiferous kimberlite clusters in the world. The kimberlites appear to be large and tend to have broad champagne glass forms lying under 100 meters of glacial cover.
Investments, Time and Financial: The project has been underway for approximately 14 years and $25 million has been spent by the joint-venture partners.
Recent Developments: De Beers current emphasis is on moving the project toward a decision regarding prefeasibility as quickly as possible. Future planned work includes: drilling mini-bulk sampling holes to obtain a small macrodiamond sample of approximately 100 carats as well as a drilling program to test newly defined kimberlite targets in the southern claim area, which were identified by airborne magnetic and electromagnetic surveys.
KIMBERLITE DISCOVERIES
In addition to the mining projects and the exploration in later stages, there have also been a number of significant, still-developing kimberlite discoveries in Canada. The following are among the many.
In the NWT, De Beers and GGL Diamond Corp. have recovered diamonds from the Dolye Lake Project, which is located southeast of the Slave Craton. In Nunavut, Tahera has conducted mini-bulk sampling on the Anuri pipe on its Rockinghorse Property. On Melville Peninsula, there has been an extensive program conducted on the AV1 and AV2 kimberlites of the Aviat Project, a joint venture between Stornoway Diamond Corporation, BHP Billiton and Hunter Exploration Group. At the Churchill Diamond Project, a joint venture between Shear Minerals, Stornoway, International Samuel Exploration and BHP Billiton, there have been 10 diamondiferous kimberlites found.
In Alberta, Ashton Mining has discovered 25 diamondiferous kimberlites in Buffalo Hills. In Quebec, the Ashton Mining/Soquem Inc. joint venture is sampling some of the ten kimberlite pipes found on its Foxtrot Property in the Otish Mountains. In Saskatchewan, Shore Gold is conducting bulk sampling of its Star property kimberlite. |
