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Gold/Mining/Energy : Winspear Resources -- Ignore unavailable to you. Want to Upgrade?

To: average joe who wrote (12779)	1/20/1999 11:43:00 AM
From: Gord Bolton	Read Replies (1) \| Respond to of 26850

datetime:18 Jan 1999 05:28:00 / WINSPEAR RESOURCES LTD WINSPEAR RESOURCES LTD. ("WSP-V;WSPEF-L") - Camsell Lake Property Additional Results From Evaluation Randy C. Turner, P.Geo, President and Director of Winspear Resources Ltd. is pleased to report additional results from its evaluation of the diamonds recovered from processing two 100-tonne mini-bulk samples that were obtained from the subcrop of the NW dyke, Snap Lake area, Camsell Lake property, NWT. This property, which is situated 230km northeast of Yellowknife, is operated through a joint venture in which Winspear has 67.7% interest and is Operator. BACKGROUND: The NW dyke at Snap Lake was discovered by diamond drilling in 1997 when it was intersected by 13 drill holes. Because of very encouraging results obtained from caustic fusion analyses for microdiamonds in these drill core intersections, two 100-tonne samples were obtained from the dyke in the Spring of 1998 and processed in the Kennecott plant located in Yellowknife. Cleaned diamonds recovered from the plant weight 226.72 carats which establishes the grade of the kimberlite sample at 1.14 carats/tonne. Three independent diamantaires in Antwerp valued these diamonds at US$301/carat. NEW RESULTS: Coarse Diamond Size Distribution: The value of kimberlite comprising the mini-bulk sample from the NW dyke is enhanced by the presence of three large gem-quality diamonds weighting 10.82, 8.42, and 6.04 carats respectively, two of which were recovered from Pit 2 and one from Pit 1. Furthermore, an additional 22 diamond were recovered that weight between 1.01 and 5.00 carats. Seven of these 22 diamonds were recovered from the Pit 1 sample and the remaining fifteen were recovered from the Pit 2 sample. The combined weight of the 25 diamonds that weigh more than one carat is 67.72 carats; this represents 29.8% by weight of the total parcel. These weights were established in the process of obtaining a detailed study of the diamonds by Dr. Malcolm E. McCallum, results of which are reported below. The three large diamonds contribute approximately 10% of the weight and about 75% of the value of the total parcel. The balance of the parcel exclusive of the three large stones is valued at US$83.26/carat. This distribution of values is in keeping with results that would be expected from an occurrence with a significant population of large, high-value gem stones. Several noteworthy aspects of these 200 tonne mini-bulk sample results are: * Although this mini-bulk sample is regarded as too small to accurately predict either value or grade for the kimberlite comprising the NW dyke, it is important to note that the kimberlite does carry large gem-quality diamonds. * The diamond population obtained from the mini-bulk sample for stones greater than 1 carat in size is not large enough to be statistically relevant. However, the average diamond size of the recovered diamonds less than one carat is consistent with that of a producing kimberlite with a high average stone-size and a bottom cut-off similar to that used in the Kennecott plant. * The three large diamonds recovered from the mini-bulk sample contribute 25.28 carats or approximately 10% of the total weight of diamonds recovered. The value of the remaining diamonds is US$83.26/carat (approximately Cdn$122/carat) which equates to a value of approximately US$94.90/tonne (about Cdn$140/tonne). MRDI Canada, a division of H.A. Simons Ltd. has estimated in a scoping study on potential mineability of the NW dyke kimberlite that total operating costs (Mining, Processing, General & Administration) of a combined open pit/underground mine based on known characteristics of the NW dyke, assuming a ten-year mine life and 1000 tonnes/day production rate, is Cdn$86.41/tonne (approximately US$59/tonne). Winspear notes that the smaller diamonds alone would more than cover the estimated operating costs. * As the 200 tonne mini-bulk sample contains relatively large, high quality gems, the NW dyke may differ significantly from most other kimberlites reported to date from the NWT in that a significant portion of its value may be contained in large, high-value diamonds. * Diamonds to be recovered from the larger 6000 tonne bulk sample planned for the Spring of 1999 will more accurately reflect grade and value characteristics of kimberlite from the NW dyke. Geostatistical evaluation of diamonds recovered from the 200 tonne mini-bulk sample points to the likelihood that larger diamonds will be recovered from this bulk sample. Although the quality of these larger diamonds cannot be predicted by geostatistical techniques, the fact that the three largest diamonds recovered from the NW dyke are good gem diamonds suggests that more large gems will be recovered from a larger bulk sample. Diamond Study: The parcel of diamonds recovered from the two 100 tonne kimberlite samples obtained from the NW dyke comprises 1387 diamonds. A study of 1291 diamonds from this parcel was undertaken by Dr. Malcolm E. McCallum, a recognized international expert with considerable experience in this field. The remaining 96 diamonds that were not studied in detail represent the smallest screen-size of diamonds recovered. Because plant recovery in this small size range is inefficient, these diamonds were considered to be unrepresentative of the size class and were omitted from the study. Although the small size of this diamond parcel precludes rigorous statistical treatment, Dr. McCallum considers that the observed distribution of the physical properties is statistically relevant. The main conclusions of his report are as follows: * The various physical characteristics exhibited by the three large gem diamonds (10.82, 8.42, and 6.04 carats) recovered from the kimberlite are completely consistent with those observed in smaller stones from all size fractions. * There is a very strong correlation of morphological characteristics between diamonds recovered from each of the two sample sites. * The number of large stones recovered from this sample is unusual but not unprecedented. Based on the high concentration of large diamond fragments in the +9 and +11 size fractions, as well as evaluation of size-frequency distribution curves, preferential breakage of larger, poorer quality stones appears likely to have occurred either by late magmatic or induced processes. Dr. McCallum subsequently has commented that some of the overgrowth features present on many diamonds in this population have not been reported from other localities in NWT and may provide a unique signature for diamond parcels from the NW dyke at Snap Lake. Winspear notes that kimberlite of the NW dyke is also unusual in its intrusive form and compositional characteristics of its indicator minerals. Summary: Significant points of the information presented above are as follows: * Diamonds recovered from the mini-bulk samples have size/frequency distribution characteristics consistent with a coarse diamond population. Although the number of large diamonds recovered from the mini-bulk sample is too few to be statistically significant, large gem-quality diamonds do occur in kimberlite from the NW dyke. * Removing the value represented by the three largest diamonds from the value of the total parcel of recovered diamonds results in an average value per tonne that is about 60% higher than total estimated operating costs for a combined open-pit/underground mining operation. Results have been received for caustic fusion analyses of 500kg of kimberlite representative of the mini-bulk samples and from kimberlite intersections obtained from the 1998 drill programs. These results will be released shortly when preliminary evaluation of them has been completed. Winspear regards these results as very encouraging and supportive of the recently announced 1999 program on the property estimated to cost about $12 million. This program, which will mainly comprise bulk sampling and diamond drilling, will get underway as soon as winter conditions permit. TEL: (604) 687-6644 Randy C. Turner, P.Geo, President/Director FAX: (604) 687-1405 1-800-686-7744 Toll Free EMAIL: randarc@helix.net INET: www.winspear.com