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Posts tagged ‘Altius Minerals Corporation (ALS)’

Shining Potential

June 5th, 2012

Noble finds Awaruite among Ontario Nickel and Gold

By Greg Klein

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Awaruite—pronounced a-WHAH-roo-ite—is a naturally occurring nickel-iron alloy that might be described as naturally occurring stainless steel, according to Vance White, President/CEO of Noble Mineral Exploration TSXV:NOB. And the stuff bids fair to further enhance the company’s Project 81, which already offers not only gold and nickel targets but also timber rights in the Ontario’s Timmins region.

That’s not to say that anyone expects to mine shining pots and pans straight out of the ground. But, as White points out, “Awaruite lends itself to magnetic separation in processing, which can mean shipping a concentrate direct to steel mills without smelting. It has tremendous benefits from both an environmental and a cost standpoint. You don’t need the CAPEX or operating costs of a processing facility.”

Noble finds Awaruite among Ontario Nickel and Gold

Noble's Project 49: Awaruite, nickel, gold and infrastructure galore.

Elsewhere this alloy, which is usually found in ratios of approximately three parts nickel to one part iron, has attracted the attention of Cliffs Natural Resources NYE:CLF. In 2009, this giant supplier to the steelmaking industry entered a joint venture with First Point Minerals TSXV:FPX on the Decar Project in BC. First Point says it believes Decar is “the first property of its type anywhere in the world to be explored for possible commercial production of nickel entirely from awaruite.” And last year, Cliffs struck a strategic partnership with Altius Minerals Corp TSX:ALS, attracted by the company’s awaruite exploration in Newfoundland.

Noble‘s awaruite turned up in samples from Project 81′s Kingsmill Deposit that had previously been assayed for nickel. The new results prompted Noble to bring on new talent, metallurgical consultant Gordon Bacon, who boasts extensive experience in awaruite deposits around the world.

“We’re very pleased to see the awaruite occurrence and to retain Dr Bacon,” White says. “We look forward to the additional evaluation that he’ll be carrying out over the next few weeks.”

Kingsmill’s nickel assays had thus far been provided in two forms, aqua regia and total-digestion inductively coupled plasma (AR-ICP and TD-ICP). In an interview last March, Noble‘s VP Exploration Randy Singh explained the distinction. “Aqua regia dissolves the sulphide nickel. Total digestion is a four-acid digestion that dissolves everything, the silicate nickel and the sulphide nickel. We use both assays because if all your nickel is in silicates, it’s not economically possible to recover it. Any assay that is more than 0.25% nickel aqua regia gets a third assay. It’s a wet chemistry technique, which is an assay-quality analysis that’s even more accurate for sulphide nickel. It’s a much more involved analysis, and we’ll release those results when we receive them.”

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A Pleasant Surprise

March 26th, 2012

Zenyatta Finds Graphite while Exploring Ontario for Nickel-Copper

By Greg Klein

On completing its December 2010 IPO of $9.9 million, Zenyatta Ventures TSXV:ZEN began 2011 with big ambitions. The company set out to explore its Albany Project in northern Ontario, which may sit on a structure related to the Mid-Continent Rift, home of a number of significant deposits around Lake Superior. Zenyatta hoped for a nickel-copper-polymetallic deposit comparable to the Norilsk Nickel mine in Siberia, Vale‘s Voisey’s Bay operation in Labrador or Rio Tinto‘s Eagle deposit in Michigan. So far, that goal has proved elusive. But what the Albany Project (aka Arc of Fire) drill results do show, says President/CEO Aubrey Eveleigh, might be equally compelling—the possibility of an exceptionally large deposit containing the exceptionally unusual occurrence of vein-type graphite.

Vein (or lump) graphite is the rarest, hence most expensive, type of natural graphite. At the other end of the scale, amorphous graphite is the type most commonly found and is widely used for steelmaking, auto parts, sports equipment and other applications. Flake graphite is essential to the emerging markets that include solar panels, fuel cells, pebble-bed nuclear reactors and the lithium-ion batteries that are becoming standard for electronic devices and electric vehicles. But little is spoken of vein graphite—likely because there’s so little to speak of.

Zenyatta Finds Graphite while Exploring Ontario for Nickel-Copper

Currently the world’s supply depends on Sri Lanka, whose mines contain exceptionally pure graphite, often grading over 90%. The product transmits heat and electricity more efficiently than other graphite types and is easier to mould. As a result, it’s in high demand for specialized uses such as the electric brushes used in motors and generators and in powder metallurgy used to manufacture parts for industries that include the automotive, aerospace, energy and medical/dental sectors.

So how did Zenyatta’s aspirations turn from a Voisey’s Bay to a Sri Lankan-type target? “We flew our property with an airborne survey and got a very large conductor that measures 1,400 metres by 800 metres,” explains Eveleigh. “That’s a whopping conductor. We thought it was copper-and-nickel massive sulphides. It’s covered with swamp so we had to drill blindly. But we started to get this graphite-rich breccia zone. Basically, from top to bottom we were getting all this graphite. So it’s pretty large and pretty unique because it’s a hydrothermal graphite deposit unlike what anybody is promoting in North America right now. There is one in Sri Lanka that’s similar to it, and that’s a vein-type graphite.”

Results announced January 19 from one hole show eight separate breccia zones, the first starting at 79.8 metres and the last ending at 522 metres. The following assays were released.

  • 4.6% carbon over 9.9 metres
  • 4.2% over 67.5 metres
  • 3.3% over 7.9 metres
  • 2.5% over 48.2 metres
  • 3% over 26.4 metres
  • 4.2% over 5.5 metres
  • 2.1% over 7.5 metres
  • 3% over 16 metres

A mineralogical study at Lakehead University found graphite ranging from fine (-270 mesh) to coarse (+40 mesh). The next step is bench-scale testing to better determine the deposit’s purity, flake-size distribution and recoverability. Results from SGS Canada are expected within two to four months.

“This could be exceptional; it could be very valuable; and certainly the market is bullish on graphite right now,” says Eveleigh.

Meanwhile, drilling will resume presently. “We need to determine the size of it. If we judge by the airborne conductor, it looks pretty big, but you still have to prove that. So we’re stepping out quite a ways, like 200-metre step-outs. If it’s still there, we can extrapolate in between and say this looks like a pretty big deposit. If it’s as big as the conductor suggests, it will be one of the biggest graphite deposits in the world.”

If it’s as big as the conductor suggests, it will be one of the biggest graphite deposits in the world —Aubrey Eveleigh

About 4,000 metres of drilling is planned. And the company’s still looking for that big nickel-copper find in its 121,000-hectare Albany Project. “We have 28 different claim blocks,” Eveleigh points out. “We found the graphite on one block and we’re advancing that, but we’re also exploring the other 27 blocks.”

The graphite deposit has “good access and good infrastructure,” he adds. It sits four kilometres from an all-weather logging road, 30 from the Trans-Canada Highway and 70 from a rail line.

As a geologist, Eveleigh’s career began with Noranda and includes a seven-year stint as a partner in a consulting firm that worked for around 50 juniors and majors. He also held a highly successful position with Wolfden Resources and is currently president of Eveleigh Geological Consulting, which has provided expertise for companies including Rio Tinto, Goldcorp TSX:G, Agnico-Eagle TSX:AEM, Diavik Diamond Mines and BHP Billiton.

Zenyatta’s team includes Barry Allan, an exploration geologist turned Senior Mining Analyst for Mackie Research Capital, and Cliff Davis, who boasts over 40 years’ experience in open-pit and underground mining. Brian Davey, a member of the Moose Cree First Nation, has 28 years’ experience in issues mostly related to First Nations economic development. Some other management and advisory staff include Don Bubar, president of Avalon Rare Metals TSX:AVL and Roland Butler, co-founder of Altius Minerals TSX:ALS, which holds a 10% interest in a 3% Voisey’s Bay net smelter royalty.

The company has an 80% earn-in option with Cliffs Natural Resources CLF, which calls for $10 million of spending over four years. Zenyatta has already earned 25% by completing its airborne survey. Cliffs holds 11.8% of Zenyatta’s shares.

Cliffs also helps with technical support, so we’re moving this along together,” Eveleigh says. “They obviously like these projects, and they’re very supportive of us.”

Insiders hold 23.5% of Zenyatta shares while another 35% is institutional. At press time Zenyatta had 39.6 million shares trading at $0.15 for a market cap of $5.9 million.

Eveleigh will make a presentation at OnPage Media’s May 2 Graphite Express-Conference at Toronto’s Sheraton Hotel. Click here for free registration.

Disclaimer: Zenyatta Ventures Ltd is a client of OnPage Media, and the principals of OnPage media may hold shares in Zenyatta.

The Iron Hub

September 28th, 2011

Alderon Sees Massive Kami Production

By Greg Klein

Something big is happening in Labrador and, according to Alderon Resource TSXV:ADV Executive Chairman Mark Morabito, it’s part of the most underreported story in mining. “Everybody knows Chinese steelmakers want to diversify their iron ore supply away from the Big Three, which are Vale, Rio Tinto and BHP Billiton. So the Chinese are out there making deals with earlier-stage companies. But that’s had a domino effect.”

Morabito explains that as these steelmakers are making these investments and securing future offtake, they’re crowding out their competitors. “They’re forcing the Koreans, Japanese, Turks and Indians into earlier-stage deals as well. So a company like ours has all sorts of future customers it can choose from.”

Alderon Sees Massive Kami Production

As a result, Alderon has signed something like 14 non-disclosure agreements with “primarily Asian steel concerns” interested in its Kamistiatusset Project in Labrador. With iron ore prices projected to stay in the $180-to-$200-a-tonne range and global steelmaking expected to double over 15 to 20 years, Kami’s become a major player in the iron ore boom of the Labrador Trough, which straddles the Quebec-Labrador border.

“There are no other iron ore projects in Canada that can get to production before us,” says Morabito. “We’ve identified a billion-tonne-plus deposit in an area that has low-cost power, right beside a common-carrier railway leading to a port that’s undergoing major expansion. And we’re going to continue our track record of success—we under-promise, we over-deliver, and we’re going to continue doing just that.”

Anyone troubled by the semantic confusion of promising to under-promise might consider Alderon’s ambitious timeline compared to a PEA that can, in retrospect, seem quaint.

Released September 8, it projected a 2.7-year payback on a $989 million CAPEX with a 40.2% pre-tax IRR, a US$3.07 billion NPV discounted at 8% and a total operating cost excluding royalties of US$44.87 per concentrate tonne averaged over a 15.3-year mine life. The study covers rail facilities, port expansion in Sept-Iles and an open pit with concentrator producing 8 million tonnes a year of 65.5% iron.

The PEA was based only on one deposit of 376 million tonnes grading 29.8% iron indicated and 46 million tonnes grading 29.8% inferred.

Just five days later, however, an updated 43-101 reported numbers for all three Kami deposits, boosting the indicated category to 490 million tonnes grading 30% and the inferred to 598 million tonnes grading 30.3%.

But Alderon’s not stopping there, Morabito says. “If we convert all the inferred from the second resource estimate into the indicated, and pick up some additional tonnage, we’re looking at a resource of 1.2 to 1.4 billion tonnes. That would make it bigger than Consolidated Thompson.”

The reigning king of the Labrador Trough, Consolidated Thompson began production last year, quickly doubling its initial 8-million-tonne capacity. Last June, it was bought out by Cliffs Natural Resources for $4.9 billion.

“We’re re-categorizing and upgrading our resource with definition drilling,” Morabito continues. “We’re doing some geotechnical drilling and pit design drilling, but exploration is over.”

We’ve got a mix between operators and mine builders, and it’s a potent mix that gives us a competitive edge. We’re taking this into production ourselves —Mark Morabito

Definition drilling continues until March or April 2012, with feasibility slated for completion in 3Q 2012 and permitting in 3Q 2013. Pilot production begins in 4Q 2014 and commercial production in 2015.

Alderon is part of a pullulating mining camp. Kami is located fewer than seven kilometres from the Bloom Lake Mine that Cliffs recently picked up. Cliffs also runs the nearby 5.5-million-tonne Wabush Mine.

Steelmaking giant ArcelorMittal owns the Mount Wright and Fire Lake mines, which are slated for a $2.1-billion upgrade to raise production from 14 million to 24 million tonnes by 2013.

Iron Ore Company of Canada plans to increase its 17-million-tonne Carol Project to 26 million by 2013. Additionally, there’s talk of 50 million tonnes by 2016. Rio Tinto holds 58.7% of IOC, with Mitsubishi Corp holding another 26.2%.

When it comes to talk of Alderon’s management, Morabito’s enthusiasm overcomes his modesty. “We’ve got the best team of any development-stage iron-ore project in the world, I think,” he says. “I secured the project originally. Directors Stan Bharti and Bruce Humphrey were two principals with Consolidated Thompson; so we joined up and brought together people who’ve been working in Newfoundland and Labrador for years.”

IOC alumni now working with Alderon include President/CEO Tayfun Eldem and COO Brian Penney and Directors David Porter and Matt Simpson. “Our Executive VP of Environmental and Aboriginal Affairs is Todd Burlingame,” Morabito adds. “His last big permitting project was the Lower Churchill hydro project, 3,000 megawatts and right in the same area with all the same stakeholders. Gary Norris was the former head of the Newfoundland civil service; he’s our VP of Government and Community Affairs. Our chief geologist, Ed Lyons, was chief geologist of Consolidated Thompson and Director Brad Boland was its CFO.”

“So we’ve got a mix of operators and mine builders, and it’s a potent mix that gives us a competitive edge,” Morabito says. “We’re taking this into production ourselves.”

Alderon is backed by Forbes & Manhattan, the merchant bank that helped steer Consolidated Thompson through the 2008 crisis.

At press time, Alderon had 82.7 million shares trading at $2.55 for a market cap of $210.9 million. As of September 22 insiders held 11.9%; Altius Minerals TSX:ALS held 39.3%; and the company had working capital of $16.2 million.