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Weekly UpdatesA potential diamond mine that pays for itself?
Executives at Dianor Resources will find out over the next 18 months as they, prepare to take a 50,000 tonne bulk sample from its Leadbetter diamond project near Wawa if.
With government approvals in hand to proceed, the Val d'Or, Que. junior calls it an "important milestone" in advancing the project since they first began exploration in April, 2005.
"The bulk sample will be the first in a major series of steps to eventually mine, but it's function is to give the grade and value of diamonds which determines the economics," said company president John Ryder.
The company's rehabilitation and closure plans were filed with the Ministry of Northern Development and Mines in the spring and has since received approval. It's a major regulatory requirement before commencing advanced exploration programs.
There is the bonus of other elements present that can help pay for operations.
"We know there's gold present, rubies and sapphires, but don't know their potential economic benefit," said Ryder.
Between 40 to 60 per cent of the conglomerate has produced samples containing detectable gold.
"This is what makes Leadbetter different from any other diamond operation in the world," said Ryder. The diamonds are the main focus, but we're also lucky to have these other minerals as a bonus."
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The diamonds, rubies and sapphires will be extracted from two underground ramps on the property, 12 kilometres northeast of Wawa. With positive results, it will lead to starting pre-feasibility and feasibility studies.
Dianor has performed more than 43,000 metres of exploration drilling to get an idea of the size of the 2.69 billion-year-old Archean conglomerate and its potential diamond grades. Dianor followed that up with a series of mini- bulk samples to take a look at some of the stones.
"All of that was positive and now we have to go through the next stage to take this very large bulk sample," said Ryder.
Trucking costs would be too prohibitive to take a 50,000-tonne sample off-site, so they will be assembling a DMS (dense media separation) plant to crush the material on-site. The diamonds recovered will be sent to a secure facility for cleaning and weighing.
The gold will be recovered by use of a Nelson concentrator.
The company expects to recover between 12,000 and 20,000 carats to determine grade and per carat diamond values. Exploration drilling indicate they are averaging just shy of four-carats-per tonne.
So far, the economics of this advanced project appears to be tilting toward developing an open pit, but Ryder is careful in choosing his words.
"We're very impressed with the results that we've got to date." Because of the property's easy accessibility by road and near-surface diamond-bearing rock which contribute to a low cost operation, "we feel very confident that things will go forward."
Should the results prove positive, they'll launch into a project pre-feasibility study, another major step toward economically proving up an operating mine.
In 2007, tonnage estimate for the 2.69 billion-year-old rock is in the range of 549 million to 583 million tonnes of diamond-bearing rock, much of it near surface.
"You don't need very high diamond prices, and very high diamond grades to have an economic deposit," said Ryder.
www.dianor.com
By IAN ROSS
Northern Ontario Business
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