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MINING NEWS: Sparkle in the stubble? Two ventures hold hopes of commercial diamond industry on Canadian Prairie — Kensington Resources, Shore Gold Gary Park Petroleum News Calgary Correspondent
Saskatchewan, Canada’s so-called breadbasket because of its seemingly endless grain fields and also the country’s second-largest oil and gas producing province, has hopes of adding diamonds to the portfolio.
After years of probing beneath the Prairie and studying the results, two mining companies are inching closer to deciding whether they have the resources to go commercial.
Claiming to have control of the world’s largest diamond deposits, Victoria, British Columbia-based Kensington Resources and its joint venture partners have spent C$30 million since 1995 to identify 63 kimberlite bodies totaling about 9 billion tonnes.
Kensington says the Fort a la Corne venture, which covers 57,000 acres, does “not contain the same spectacular grades” as the Ekati and Diavik projects in the Northwest Territories. But it has offsetting advantages, being close to cities, services and infrastructure and offering a reasonable year-round climate.
The partners are now moving ahead with a C$7.6 million program that will stretch into 2005, with Kensington describing the central thrust as shifting from assessing the average grades of individual bodies to defining higher-grade zones “with the objective of delineating 80-100 million carats in ground.” No indication when decision will be made If those zones are pinpointed, more drilling will be needed, with no indication when a make-or-break decision will be made.
But what raises hopes among those on the outside is the participation of South African diamond giant DeBeers in the venture. Kensington and DeBeers each own 42.5 percent of the property, with 5.5 percent held by Saskatchewan-based uranium miner Cameco and the remainder (10 percent carried) by UEM Inc.
DeBeers already has stakes in the Snap Lake project, scheduled to be the third diamond mine in the Northwest Territories, plus the Gahcho Kue project in the Northwest Territories and the Victor project in Ontario.
Richard Molyneaux, chief executive officer of De Beers Canada, acknowledging the global shortage of diamonds, told the Financial Post that his company is as anxious as anyone to decide whether Fort a la Corne can be moved to the production stage.
But he said “we’re a long way before we can get to a decision point,” although that will happen “as soon as possible.” Junior Shore Gold also exploring Meanwhile, Saskatoon-based Shore Gold has early indications of a kimberlite body in the 500 million tonne range, also in the Fort a la Corne area, 40 miles east of Prince Albert.
The company, with 123 claims covering 68,500 acres, says the area has more than 70 kimberlites and more than 70 percent have been shown to contain diamonds.
Shore Gold has targeted 14 locations for drilling and is close to the midway point in a C$15 million program to assess 25,000 tonnes of rock and recover at least 3,000 carats for valuation.
By then the junior company, which is also exploring Saskatchewan for gold and copper, will have a fix on what the diamonds are worth from what it says is the “longest intersection of continuous kimberlite from a vertical drill hole ever reported in North America.”
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