DIAMONDS – Prima Fluorspar Corp. July 3 announced it has entered an option agreement with DG Resource Management Ltd. to acquire 100 percent interest in the Godspeed Lake diamond property in the southern portion of the Slave Province, Northwest Territories. Reflecting its new focus on diamond exploration, the company also announces that it has changed its name to Prima Diamond Corp. and will now trade under the symbol PMD on the TSX Venture Exchange. Prima President and CEO Robert Bick said, "Diamond exploration in Canada is attracting increased attention with world diamond supplies dwindling as several of the bigger mines decrease production while the demand for diamonds is increasing with particular growth in China and India.” The 42,000-hectare (104,000 acres) Godspeed Lake property borders the east side of Gahcho Kué, which is owned by a joint venture between De Beers (51 percent) and Mountain Province (49 percent). Prima said Godspeed is significantly under-explored compared with other properties in this area and represents excellent potential to discover additional kimberlites. In consideration of the grant of the option, Prima has agreed to pay to DG Resource C$150,000 cash and issue 4.5 million common shares of Prima payable as follows: C$10,000 upon execution of the option agreement (paid); C$100,000 cash and 2 million Prima shares upon TSX Venture Exchange acceptance; an additional C$20,000 within three months of TSXV acceptance; an additional C$20,000 within six months of TSXV acceptance; and issue an additional 2.5 million common shares one year after the TSXV acceptance. DG Resource will also retain a 2.5 percent gross overriding royalty on all diamond production. Prima will be entitled at any time to purchase 1 percent of this royalty C$2 million in respect of all minerals other than diamonds. The Agreement is subject to final acceptance of the Exchange.
DIAMONDS – Mountain Province Diamonds Inc. June 30 reported that the 2014 Tuzo Deep drill program at Gahcho Kué has confirmed the continuation of kimberlite to a depth of more than 740 meters below surface. In July 2013, Mountain Province released an updated independent National Instrument 43-101 resource statement for the Gahcho Kué diamond project diamond project in Northwest Territories, which incorporated the results of the 2012 Tuzo Deep drill program. The Tuzo resource from a depth of 300–360 meters was upgraded from an inferred to indicated resource, extending the indicated resource from surface to 360 meters below surface. In addition, the 2012 Tuzo Deep drilling resulted in the declaration of an inferred resource from a depth of 360-564 meters below surface. The recently completed 2014 Tuzo Deep drill program was designed to test the kimberlite to a depth of roughly 750 meters. Mountain Province President and CEO Patrick Evans said, “We are pleased that the 2014 Tuzo Deep drill program has confirmed the continuation of the kimberlite to a depth of more than 740 meters below surface. Based on the current geological model, it appears that the Tuzo kimberlite plunges further to depth to the northeast below 740 meters.” Core recovered from the program will be processed at the Geoanalytical Laboratories Diamond Services of the Saskatchewan Research Council. The Gahcho Kué joint venture (De Beers Canada 51 percent, Mountain Province Diamonds 49 percent) will assess the results of the 2014 Tuzo Deep drill program to determine possible next steps in upgrading the Tuzo Deep resource.
FINANCE – Mountain Province Diamonds Inc. June 27 reported the closure of a previously announced non-brokered private placement of common shares for gross proceeds of C$45.5 million. The company has issued 9.1 million common shares at a price of C$5 per share. The shares issued under the placement are subject to a four month hold period. Major shareholder Bottin (International) Investments Ltd. subscribed for two million shares under the placement using proceeds from the disposition of an equivalent number of shares to a third party. Proceeds of the private placement will be used to support the company’s share of capital expenditures at the Gahcho Kué diamond project and for general corporate purposes. A finder’s fee in the amount of C$755,250 has been paid in relation to the private placement. Mountain Province Diamonds is a 49 percent participant with De Beers Canada in the Gahcho Kué joint venture located at Kennady Lake in Canada’s Northwest Territories. Gahcho Kué consists of a cluster of four diamondiferous kimberlites, three of which have a probable mineral reserve of 35.4 million metric tons grading 1.57 carats per metric tons for total diamond content of 55.5 million carats.
FINANCE – Nighthawk Gold Corp. June 25 said it has issued 17,262,500 flow-through units at a price of C40 cents per unit and 2,737,500 non-flow-through units at a price of C40 cents per unit for gross proceeds of $8 million. Each flow-through unit consists of one common share of Nighthawk, which qualifies as a “flow-through share” within the meaning of the Income Tax Act (Canada) and one-half of purchase warrant. Each non-flow-through unit consists of one common share and one-half of one warrant. Each warrant entitles the holder thereof to acquire one common share of Nighthawk at a price of C50 cents until Dec. 25, 2015. Primary Capital Inc., as lead agent, PowerOne Capital Markets Ltd. and Edgecrest Capital Corp. acted as agents for and on behalf of the company, with respect to the offering, pursuant to which they received a cash commission equal to 6 percent of the gross proceeds of the offering and 1.2 million broker warrants each of which is exercisable to acquire one common share at a price of C45 cents until Dec. 25, 2014. The securities issued are subject to a hold period expiring Oct. 26, 2014 in accordance with the rules and policies of the TSX Venture Exchange and applicable Canadian securities laws and such further restrictions as may apply under foreign securities laws. Nighthawk is focused on acquiring and developing gold mineral properties in the Northwest Territories. Its land position covers 930 square kilometers (229,791 acres) in the Indin Lake Gold Camp, located about 220 kilometers (136.4 miles) north of Yellowknife, NWT. The gross proceeds from the sale of the flow-through units will be used to continue exploration of the company’s Indin Lake gold property located in the Northwest Territories. The net proceeds from the sale of the units will be used for general working capital purposes. The offering remains subject to the final approval of the TSX Venture Exchange.
RARE EARTH ELEMENTS – On June 19, Canada’s House of Commons Standing Committee on Natural Resources released a document titled, “The Rare Earth Elements Industry in Canada – Summary of Evidence.” This summary was the outcome of a motion passed by the committee to study the “rare earths industry in Canada, given its economic potential and strategic relevance.” Hearings were held during late 2013 and early 2014. Avalon Rare Metals’ Pierre Neatby, vice president, sales and marketing, appeared before the committee in February 2014, where he noted there is a race to supply rare earths to the supply chain on a global scale and that “Canada’s opportunity is now. Neatby echoed the view shared by a cross section of industry players that the Canadian government should publicly support the development of this important emerging sector to become a serious global player in the industry. A panel with members from the Canadian Rare Earth Element Network, of which Avalon is a founding member and active participant, also appeared before the committee. In addition to describing some of the basics of the rare earth element industry including applications, global supply and demand and the role of China, the document discusses the potential economic and strategic opportunity for Canada and the key challenges facing rare earth development projects in Canada. It also speaks to current initiatives that support Canada’s REE industry, including CREEN, in its concluding section titled “The Role of the Federal Government in Advancing Canada’s Rare Earth Industry.” Avalon is encouraged to see the Canadian government’s growing interest in the sector; however, as noted in the document, “Canada’s public investment in REE research and development is relatively small.” Avalon continues to work with Natural Resources Canada and CREEN to promote increased Canadian government support for the industry. CREEN’s first Technical Workshop in Ottawa on June 17, 2014 was attended by Avalon’s senior vice president, metallurgy, Dave Marsh, and senior metallurgist, Henrietta Notzl. The workshop was co-sponsored by NRCan, Canadian Mineral Processors and the Metallurgy and Materials Society, and engaged rare earth process technology leaders from industry and academia. The main outcome was identifying and prioritizing pre-competitive research and development projects and targeted solutions expected to bring Canadian production into service by 2018. CREEN is in the process of fleshing out the proposed project lists, securing collaborative project sponsors and R&D funding. CREEN is also working on partnering with other national and international organizations to leverage existing research initiatives and funding opportunities. If you have any comments or questions on this Industry Bulletin, please do not hesitate to contact Avalon directly at [email protected]. Avalon Rare Metals Inc. is a mineral development company focused on rare metal deposits in Canada, including its Nechalacho Deposit, Thor Lake, Northwest Territories. The summary is available at http://www.parl.gc.ca/Content/HOC/Committee/412/RNNR/WebDoc/WD6669744/412_RNNR_reldoc_PDF/RareEarthElements-Summary-e.pdf).
