New Diamond Discovery Possible in Canada's North
23 Juli 2014 - 4:22PM
Diamond explorer North Arrow Minerals (TSX-V:NAR) is set to
commence its first drill program with partner Arctic Star
Exploration at Redemption, a project located in the famed Lac De
Gras diamond district, currently home to three of the world's
largest diamond mines: Dominion's Ekati, Rio Tinto's Diavik, and De
Beers' Snap Lake.
North Arrow knows the Lac De Gras region perhaps better than any
other currently assembled diamond exploration team. The company's
Chairman, Gren Thomas, made the world-class discovery of the Diavik
Diamond Mine just 32 kilometers from where drilling at the
Redemption will take place. Diavik is currently the 5th largest
diamond mine in the world estimated to produce $787 million worth
of diamonds in 2014.
Thomas, an inductee in the Canadian Mining Hall of Fame,
discovered Diavik with the same pragmatic prospecting philosophy
that the North Arrow team is utilizing at Redemption –explore the
least trafficked land in the closest proximity to the largest and
most economic diamond deposit in world. In an exclusive
interview with Financial Press, North Arrow's Thomas explained,
"The exciting thing about Redemption…in looking for a new diamond
deposit near Diavik is yes, you already know you're in the right
area geologically; the rocks have been proven, but the other thing
is you don't have to find another Diavik. You have the
existing mine infrastructure nearby already. You don't
necessarily have to find a standalone mine. This has a real
impact on lowering your threshold for a new discovery."
North Arrow President and CEO Ken Armstrong noted that he sees
particular prospective appeal in Redemption as it hosts the
Coppermine train, which is "one of the last well-defined and
un-sourced kimberlite indicator mineral (KIM) trains in the Lac de
Gras region." KIM trains are common in terrains where a
glacier advanced over a kimberlite pushing and dispersing the
kimberlite material in the path that the glacier traveled. As the
glacier melted, the train was left in place, in essence creating a
trail to the kimberlite. The discoveries of Diavik and Ekati, as
well as world-class diamond discoveries in Russia's arctic have
been identified using a similar technique.
Kimberlite pipes are geological formations that serve as the
primary source of mined diamonds.
Prior to North Arrow's involvement in the project, Redemption
had over C$13 million invested in exploration with over 3,100 till
samples taken and 10 airborne geological surveys conducted on the
property. Given all of the exploration dollars spent on the
project, there have only been approximately 20 holes drilled, and a
lot of the past drilling encountered logistical complications
failing to provide a true indication of the targets
potential. The history of Redemption presents an optimal
opportunity for recently financed North Arrow to step in as project
operator.
In July of last year, North Arrow entered into an earn-in
agreement with Arctic Star, where North Arrow has the option to
spend C$5 million by July 2017 to earn a 55% interest in the rights
to Redemption. By the completion of the current drill program,
North Arrow will have already spent approximately C$2 million
towards the earn-in.
With the help of new geophysical technology and advanced mineral
chemistry that did not exist during the last diamond rush in Canada
following the discovery of Ekati and Diavik over 15 years ago,
North Arrow has singled out 6 to 8 "high-priority" targets to
drill, totaling 1000 meters. Any kimberlite discovery in the
Coppermine train could be a big boost for North Arrow
shareholders. Armstrong notes hitting kimberlite for the first
time in the Coppermine train would "provide validation of our
business plan." Given the indicator minerals found in the
train, there is good reason to believe that if kimberlite is
identified it will bear diamonds.
According to De Beers, only 6,400 kimberlite pipes have been
discovered in the world, of those only approximately 900 have been
classified as diamond bearing, and of those just about 100 have
been economic enough to mine. This past November North Arrow
stock surged 40% after the company announced that its exploration
efforts led to a diamond bearing kimberlite discovery at its Pikoo
property in Saskatchewan.
The North Arrow drill team arrived at the Redemption camp late
last week and the drilling program is set to run through the middle
of August. Results from the program can be expected shortly
after drilling is complete, if not before --if kimberlite is hit,
the results may be considered material and would merit an imminent
press release.
In addition to Redemption, North Arrow shareholders also
enthusiastically await results from one of the company's Nunavut
projects, Qilalugaq, where results from a bulk sample are expected
in early 2015. The results from the bulk sample could be a game
changer for the company, as Armstrong notes "strong results from
the sample could take North Arrow from an exploration company to a
developer."
North Arrow is one of the few pure diamond exploration companies
in the world today just as a boost in new demand for diamonds is
forecast to outpace new supply. Russia's Grib mine, which started
production last month, will be the first new non-alluvial diamond
mine to produce more than 1 million carats per year since Diavik
came online in 2003.
New global demand for diamonds is primarily coming out of China,
where the current generation is the first to adopt the Western
tradition of giving diamond engagement rings. The number of urban
Chinese brides being given a diamond engagement ring has increased
from less than 1% to greater than 50% over the last 20 years; half
of China's population of 1.3 billion is considered urban.
North Arrow is just off of its 52-week high of C$0.84 closing at
C$0.81 on July 18th. The stock trades close to 100k shares a
day on the Toronto Venture exchange under the symbol NAR, and NAHWF
in the U.S.
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CONTACT: North Arrow Minerals
Suite 960 - 789 West Pender Street
Vancouver, BC - Canada - V6C 1H2
Tel: +1.604.668.8355
Fax: +1.604.336.4813
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