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August 21, 2014 --- Vol. 08, No. 34August 2014

Northwest Territories

POLYMETALLIC – TerraX Minerals Inc. Aug. 19 reported results from 84 (60 grabs and 24 chip) samples from the Ryan Lake Pluton area of its Yellowknife City gold project in the Northwest Territories. Highlights include values of 141 grams per metric ton gold, 445 g/t Ag, 3.01 percent and 6.32 percent molybdenum in grab samples. The Ryan Lake Pluton is immediately east of Ryan Lake on the western margin of the Yellowknife project. This pluton is granodiorite to quartz diorite in composition, and contains numerous thin quartz veins, some with apparent potassium feldspar, near its margins. A number of wider (0.5 to 2 meters), north-northwest trending quartz veins contain variable amounts of molybdenite, pyrite and lesser chalcopyrite. The veins intrude the pluton and the surrounding mafic stratigraphy. The most significant structure is Shear 17, which can be traced for 1,200 meters. TerraX collected 84 samples, including 24 chip samples, from veins within Shear 17 and from nearby sub-parallel veins. Gold results varied from below detection to 141 g/t, which was from a grab sample of a vein close to Shear 17. Silver values ranged from below detection to 445 g/t. Copper varied from 7 ppm to 3.01 percent. Molybdenum ranged from 1 ppm to 6.32 percent. A chip sample from the northern portion of Shear 17 returned 6 meters grading 2.03 g/t gold, 0.09 percent and 0.05 percent molybdenum. The highest copper and silver values were from a grab sample at the northern end of Shear 17. A chip sample from the trench that produced the 6.32 percent molybdenum ran 0.5 meters grading 1.75 percent molybdenum and 88 g/t silver; both samples had greater than 1 percent bismuth. The vein that produced these high grade Mo samples is 100 meters west of Shear 17. TerraX said it is very encouraged by the results of the brief examination of this area but does not pretend to fully understand the metal distribution there. The mineralization style is different than the mesothermal gold style that comprises the bulk of the Yellowknife project (except Homer Lake); the abundance of molybdenum and copper, and the spatial association with the Ryan Lake Pluton, would point to a more porphyry style of mineralization. Known historical drilling tested a 500-meter strike length of Shear 17, however, the highest molybdenum, copper and silver values encountered by TerraX are removed from the area that was drilled. The results from the Ryan Lake Pluton are part of a recently completed prospecting and mapping program in which approximately 960 samples were collected and assayed for a range of elements. Assay results are pending from drilling recently completed at the Crestaurum and Barney mesothermal gold targets.

DIAMONDS – Dominion Diamond Corp. Aug. 19 reported that the Ekati Diamond Mine and the Diavik Diamond Mine performed exceptionally well in the second fiscal quarter of 2015 (May through July). Rough diamond production, sales and pricing have all exceeded plan. At Ekati, diamond production totaled 802,000 carats grading 0.76 carats per metric tons in 1.06 million metric tons. That compared with 483,000 carats grading 0.44 cpt in 1.1 million metric tons during the same period of 2013 and was substantially ahead of plan for the second consecutive quarter due to higher than expected grades coupled with operational improvements to the processing plant implemented by the company over the past 10 months. Following the completion of open pit mining at the Fox pipe in May, increased resources have been allocated to waste stripping at the Misery pipe. Mining at Koala underground and Koala North is continuing according to plan, with the final development work for mining the remaining material in Koala North expected to be completed by the end of August. The company has received the final approvals to proceed with the development of the Pigeon pipe. The pumping out of the water from the Pigeon test pipe has been completed and waste stripping is expected to commence in August 2014. During the second quarter, Dominion promoted the Misery South and Misery Southwest satellite pipes to inferred mineral resources (total of about 3.9 million metric tons at an overall average grade of 1.3 carats per metric ton). An updated Ekati Mine Plan, including the inferred resource at Misery South and Southwest, was published on July 21. The company estimates that process plant improvements implemented over the last 10 months have increased the recovered grade by about 15 percent during the six-month period ending July 31; the process plant improvements are ongoing. The resulting additional diamonds are not currently included in the reserves and the mine plan. Once the process improvements have been substantially completed, Dominion intends to incorporate these higher recovery rates into an updated reserve statement later this year. The Diavik Diamond Mine continues to deliver a strong performance substantially ahead of plan for the second consecutive quarter of fiscal 2015. Ore mined at the Diavik Diamond Mine, where Dominion holds a 40 percent ownership interest, was 20 percent ahead of plan for the second quarter, and 16 percent ahead of plan for the fiscal year to date. On a 40 percent basis, the mine produced 879,000 carats grading 3.49 carats per metric tons in 248,000 metric tons. That compared with 602,000 carats grading 2.76 cpt in 207,000 metric tons during the year-ago period. This performance results from higher production from all three kimberlite pipes due to favorable ground conditions and improved availability of equipment. Ore processing was 29 percent ahead of plan for the three months ended July 31, and 23 percent ahead of plan for the fiscal year to date. This was predominately due to greater ore availability as a result of higher mining rates and improved equipment availability, equipment efficiencies and utilization of the processing plant. Dominion recorded total second quarter sales of US$277.3 million (US$261.8 million in Q2 fiscal 2013).

POLYMETALLIC – TerraX Minerals Inc. Aug. 18 reported assay results from a further 113 samples of the approximately 960 surface samples taken during a six week prospecting and mapping program now completed at the Yellowknife City gold project in the Northwest Territories. This batch of samples were collected during mapping of a 1,300-by-650-meter area immediately west of Homer Lake in the northern part of the Yellowknife project, with 99 grab and chip samples collected for assay and an additional 14 samples collected for whole rock analysis. Assay results ranged from below detection to 6.61 grams per metric ton gold, below detection to 357 g/t silver, 3 parts per million to 1.51 percent copper, 9 ppm to 7.02 percent zinc, and 5 ppm to greater than 20 percent lead. Two metal domains are apparent: a gold-copper domain to the west and a gold-silver-lead-zinc domain to the east. TerraX said both targets have good size potential. The origin of the two mineralization styles has not yet been determined, but both are considered worthy of further drill testing. Maps showing the distribution of mineralization at Homer Lake are available at www.terraxminerals.com. These domains were tested by two drill holes each in April, prior to their recognition. Holes TNB14-001 and 002 tested an electromagnetic anomaly in the western domain. The anomaly was determined to be caused by pyrrhotite and lesser chalcopyrite stringers. By contrast, holes TNB14-003 and 004 were drilled under the main trench in the eastern domain. These holes intersected high grade polymetallic zones surrounded by lower grade, but still polymetallic, mineralization. The best result was from hole TNB14-004, which returned 3.42 meters grading 3.41 g/t gold, 69.3 g/t silver, 3.67 percent lead and 3.17 zinc within a broader zone of 71.15 meters grading 0.25 g/t gold, 14 g/t silver, 0.73 percent lead and 0.57 percent zinc. TerraX President Joe Campbell said, "The Homer Lake mineralization has now been traced at surface over a strike length of approximately 1.5 kilometers and has been intersected by TerraX drilling to 150 meters vertical depth from surface, in historical drilling to (more than 300 meters) vertical depth, and mineralization remains open down-dip from this drilling. The nature of the mineralization remains unclear (synvolcanic or epigenetic), but the large areal extent and high polymetallic grades provides us with an excellent base metal target to supplement the numerous gold targets that are the primary focus of TerraX’s exploration on the YCGP.”

DIAMONDS – Kennady Diamonds Inc. Aug. 18 provided an update on the 2014 summer drill program at its Kennady North diamond project in Northwest Territories. Exploration, delineation and mini-bulk sample drilling is currently underway at the Kelvin kimberlite. Drilling across the north-northwest lobe of the elongated Kelvin kimberlite pipe continues to cut 24- to 77-meter kimberlite intercepts (including minor country rock. Kennady Diamonds CEO Patrick Evans said, “Delineation drilling at the north lobe of the Kelvin kimberlite pipe is exceeding expectations and initial exploration drilling at the Kelvin dyke is returning promising kimberlite intersects. Based on the results to date, we have revised our tonnage estimate for the Kelvin-Faraday kimberlite corridor from the previous 5 to 8 million metric tons to 7 to 10 million metric tons.” Following the mobilization of a third drill rig, drilling at the Kennady North project has advanced rapidly. As a result, Kennady has further increased its estimate for the summer drill program to approximately 12,000 meters. The focus remains on delineation, exploration and mini-bulk sample drilling at the Kelvin and Faraday kimberlites, as well as exploration drilling at the MZ and Doyle kimberlites and at least four new exploration targets. To define the down-dip to the northwest of the Kelvin kimberlite dyke a fence of holes is being drilled from northeast to southwest along the western shore of Kelvin Lake. Past ice-based drilling of the Kelvin dyke has returned kimberlite intercepts ranging from a few meters to over 20 meters. If the current drill program is successful is proving continuity of the dyke to depth, the potential exists for considerable additional tonnage at the Kelvin kimberlite. To date, approximately 14.8 metric tons of kimberlite has been recovered from Kelvin. This is in addition to the 25 metric tons recovered from Kelvin during the spring drill program. The 25-metric-ton sample is currently being processing at the Geoanalytical Laboratories Diamond Services of the Saskatchewan Research Council. Results from the Kelvin mini-bulk sample are expected early in the fourth quarter of 2014.


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