ZINC/LEAD/SILVER – Canadian Zinc Corp. Oct. 7 reported the start-up of an underground program at its Prairie Creek zinc, lead, silver mine located in the Northwest Territories. Following a tender process, Procon Mining and Tunneling Ltd. has been awarded the contract to carry out mine rehabilitation, exploration, mine development and initial production at the Prairie Creek Mine. The contract was signed at ceremonies held Oct. 6 in the company’s office in Fort Simpson, and in Nahanni Butte, NWT, to mark the occasion. Attendees included representatives of the local communities of Nahanni Butte and Fort Simpson, the president of Procon Mining, Jim Dales, and Minister David Ramsay for Industry, Tourism and Investment of the Government of Northwest Territories. Alan Taylor, chief operating officer of Canadian Zinc, said, “We are excited to be getting back to work underground and to be again working with Procon. This program marks the next step towards production at the Prairie Creek Mine.” The underground mine exploration and development program has been divided into stages. The first stage will be to re-open and access the underground by dewatering and re-installing electrical and ventilation services to the 650 meter-long decline tunnel, which is located at the end of the 870-meter underground level. The 870-meter level portal is located at the mine site adjacent to the mill building. Two other existing underground levels are developed on the 930-meter and 970-meter levels.

Canadian Zinc plans to carry out an exploration diamond drill program from underground drill stations located at the end of the decline tunnel, with the objective of upgrading part of the currently inferred resources to an indicated category. The drilling will be completed on four, 50-meter sections and is estimated to comprise about 6,000 meters of diamond drill coring over 21 holes. This exploration activity will be carried out under the scope of Land Use Permit MV2012C008 and Water License MV2001L2-003 issued from the Mackenzie Valley Land and Water Board. An underground drilling rig and other equipment will be mobilized into the site by Procon. During dewatering of the decline, hydrological monitors will be installed in the 870 tunnel bedrock walls to measure groundwater aquifer flows. Data from this monitoring program will provide necessary information to predict future underground hydrology pumping requirements and plan water management on surface. At the same time as the underground program is proceeding, the company also will continue upgrade and repair work on the existing surface facilities. This surface program will include completing further site testing and engineering design work for the proposed Water Storage Pond and the Waste Rock Pile. Additional rehabilitation work will be completed on the existing camp to upgrade the trailers to more efficient standards for winter accommodations. Continued demolition of the old mill powerhouse generators and switchgear to prepare the powerhouse for the proposed new power generating equipment also will be carried out. Further upgrades of workshops and the sewage treatment plant will be completed.

DIAMONDS – Kennady Diamonds Inc. Oct. 6 reported the diamond recovery results from a 25-metric-ton mini-bulk sample from the Kelvin Kimberlite at its Kennady North property. The sample was processed by dense media separation at the Geoanalytical Laboratories Diamond Services of the Saskatchewan Research Council. “The Kelvin total sample grade of 2.16 carats per tonne is in line with our guidance of ‘better than 2 carats per tonne’ and confirms the potential for Kelvin to host a high-grade diamond resource. It’s apparent, however, that the number of larger diamonds in the sample is lower compared with previous Kelvin samples. A higher frequency of larger diamonds in previous samples resulted in sample grades well above 2 carats per tonne. The sampling and treatment methods used for the mini-bulk sample will be reviewed to understand the reasons for this,” said Kennady Diamonds CEO Patrick Evans. “In the meantime, we expect to recover a further 28-tonne mini-bulk sample as part of the current summer/fall Kelvin drill program and this sample will be dispatched to the SRC for processing as soon as possible. We expect the diamond recovery results from this second mini-bulk sample to aid in understanding the diamond size frequency distribution of the Kelvin kimberlite.” The three largest diamonds recovered from the Kelvin mini-bulk sample are described by the SRC as: 1.27 carat off-white, transparent, broken, and irregular with inclusions; 1.00 carat white-colorless, transparent, dodecahedron, twin with minor inclusions; and 0.70 carat white-colorless, transparent, dodecahedron, twin with minor inclusions. As part of the summer-fall exploration program, delineation, infill and bulk-sample drilling at the Kelvin kimberlite is continuing. Roughly 14,000 meters of drilling has been completed to date and about 25.3 metric tons of kimberlite has been recovered. Based on the success of the program, Kennady Diamonds is reviewing its tonnage target for the Kelvin-Faraday kimberlite corridor, which currently stands at 7 million to 10 million metric tons.