Mining News: Northern Neighbors: High diamond grades persist at Kelvin North

Kennady Diamonds Inc. Oct. 5 reported diamond recovery results from some 2.4 metric tons of kimberlite recovered from the Kelvin North Lobe during the spring drill program at the Kennady North property in Nunavut. The sample, which was processed by caustic fusion at the Geoanalytical Laboratories Diamond Services of the Saskatchewan Research Council, averaged 2.6 carats per metric ton for diamonds of commercial size. The four largest diamonds recovered from the Kelvin North Lobe sample are described as: 0.23 carat off-white, transparent, broken octahedral with inclusions; 0.19 carat off-white, transparent, broken octahedral with minor inclusions; 0.18 carat off-white, transparent, broken octahedral with inclusions; and 0.17 carat off-white, transparent, octahedral with no inclusions. A total of 198 individual diamonds from the above sample were described by the SRC. All but three are described as white and off-white. Two diamonds are described as yellow, only one as brown and none as gray. Three previous samples from Kelvin North Lobe returned similar grades: 2.57 carats per metric tons from a five metric ton sample; 2.74 carats per metric ton from a 2.7 metric ton sample; and 2.59 carats per metric ton from an 18.88 metric ton sample. The company plans to collect a 500 metric ton bulk sample from the Kelvin North Lobe during the winter of 2016.

Kennady Diamonds Inc. also reported the closing of the first tranche of a previously announced non-brokered private placement for gross proceeds of about C$15 million.

The company has issued 3,672,773 common shares at a price of C$2.75 per share and 1,393,235 flow-through common shares at a price of C$3.40 per share. The shares are subject to a four-month hold period expiring Jan. 31.

Proceeds from the private placement will be used to fund all aspects of the company’s Kennady North Project until the end of 2017, including drilling and bulk sampling, evaluation, a preliminary economic assessment, a definitive feasibility study, permitting and for general corporate purposes. The company has received commitments for the balance of the placement and anticipates closing the final tranche on or about Oct. 5, 2015.

- Shane Lasley