Sunday 21st October 2018

Resource Clips


Posts tagged ‘labrador’

Streamers turn to cobalt as Vale extends Voisey’s Bay nickel operations

June 11th, 2018

by Greg Klein | June 11, 2018

It was a day of big moves for energy minerals as China bought into Ivanhoe, Vale lengthened Voisey’s and streaming companies went after the Labrador nickel mine’s cobalt.

On June 11 Robert Friedland announced CITIC Metal would pay $723 million for a 19.9% interest in Ivanhoe Mines TSX:IVN, surpassing the boss’ own 17% stake to make the Chinese state-owned company Ivanhoe’s largest single shareholder. Another $78 million might also materialize, should China’s Zijin Mining Group decide to exercise its anti-dilution rights to increase its current 9.9% piece of Ivanhoe.

Streamers turn to cobalt as Vale extends Voisey’s Bay nickel operations

At peak production, Voisey’s underground operations are expected to
ship about 45,000 tonnes of nickel concentrate annually to Vale’s
processing plant at Long Harbour, Newfoundland.

Proceeds would help develop the flagship Kamoa-Kakula copper-cobalt mine in the Democratic Republic of Congo and the Platreef platinum-palladium-nickel-copper-gold mine in South Africa, as well as upgrade the DRC’s historic Kipushi zinc-copper-silver-germanium mine. Ivanhoe and Zijin each hold a 39.6% share in the Kamoa-Kakula joint venture.

Even bigger news came from St. John’s, where Newfoundland and Labrador Premier Dwight Ball joined Vale NYSE:VALE brass to herald the company’s decision to extend Voisey’s Bay operations by building an underground mine.

The announcement marked the 16th anniversary of Vale’s original decision to put Voisey (a Friedland company discovery) into production. Mining began in 2005, producing about $15 billion worth of nickel, copper and cobalt so far. Open pit operations were expected to end by 2022. Although a 2013 decision to go ahead with underground development was confirmed in 2015, the commitment seemed uncertain as nickel prices fell. That changed dramatically over the last 12 months.

With construction beginning this summer, nearly $2 billion in new investment should have underground operations running by April 2021, adding at least 15 years to Voisey’s life. The company estimates 16,000 person-years of employment during five years of construction, followed by 1,700 jobs at the underground mine and Long Harbour processing plant, with 2,135 person-years in indirect and induced employment annually.

Nickel’s 75% price improvement over the last year must have prodded Vale’s decision. But streaming companies were quick to go after Voisey’s cobalt. In separate deals Wheaton Precious Metals TSX:WPM and Cobalt 27 Capital TSXV:KBLT have agreed to buy a total of 75% of the mine’s cobalt beginning in 2021, paying US$390 million and US$300 million respectively. They foresee an average 2.6 million pounds of cobalt per year for the first 10 years, with a life-of-mine average of 2.4 million pounds annually.

Both companies attribute cobalt’s attraction to clean energy demand and a decided lack of DRC-style jurisdictional risk. But Vale also emphasizes nickel’s promise as a battery metal. Last month spokesperson Robert Morris told Metal Bulletin that nickel demand for EVs could rise 10-fold by 2025, reaching 350,000 to 500,000 tonnes.

Total nickel demand currently sits at slightly more than two million tonnes, Morris said. New supply would call for price increases well above the record levels set this year, he added.

King’s Bay Resources reports initial drill results from Labrador nickel-cobalt project

January 16th, 2018

by Greg Klein | January 16, 2018

Although collared 150 metres apart, the first two holes on King’s Bay Resources’ (TSXV:KBG) Lynx Lake property both showed nickel-cobalt values above background levels over wide intervals.

King’s Bay Resources reports initial drill results from Labrador nickel-cobalt project

Lynx Lake has the Trans-Labrador Highway
bisecting the property, as well as adjacent power lines.

Hole LL-17-01 brought 0.058% nickel and 0.013% cobalt over 115.2 metres. LL-17-02 returned 0.057% nickel and 0.014% cobalt over 110.8 metres (not true widths). The thickness of the intervals and distance between the holes suggest “potential for a more localized zone of economic mineralization in the area,” the company stated. Assays for gold, platinum and palladium are expected later this month.

The initial drill campaign tested a small part of an approximately 24,200-hectare property. Under focus was the project’s West Pit, where airborne VTEM found a shallow anomaly of high resistivity measuring about 400 metres in diameter and 50 to 300 metres in depth. Historic, non-43-101 grab sample assays from the area graded up to 1.03% copper, 0.566% cobalt, 0.1% nickel, 5 g/t silver, 0.36% chromium, 0.39% molybdenum and 0.23% vanadium.

Other historic, non-43-101 grab samples from the property’s east side showed up to 1.39% copper, 0.94% cobalt, 0.21% nickel and 6.5 g/t silver.

King’s Bay now plans geostatistical and structural analysis to identify more drill targets. A field crew returns later this year.

Meanwhile a 6% copper grade highlighted last month’s results from the company’s Trump Island project in northern Newfoundland. Four of 15 outcrop samples surpassed 1% copper and also showed cobalt assays up to 0.12%.

In September King’s Bay offered a $250,000 private placement that followed financings totalling $402,000 that closed the previous month.

King’s Bay Resources samples 6% copper in Newfoundland, awaits Labrador cobalt assays

December 15th, 2017

by Greg Klein | December 15, 2017

A three-day Phase I field program in northern Newfoundland brought encouraging copper grades for King’s Bay Resources’ (TSXV:KBG) Trump Island project. Out of 15 samples taken from outcrop, four surpassed an upper detection limit of 1% copper, with results showing:

King’s Bay Resources samples 6% copper in Newfoundland, awaits Labrador cobalt assays

  • >10,000 ppm copper, 303 ppm cobalt and >6 ppm silver

  • >10,000 ppm copper, 1,213.6 ppm cobalt and 21.1 ppm silver

  • >10,000 ppm copper, 634.5 ppm cobalt and 27.4 ppm silver

  • >10,000 ppm copper, 272.3 ppm cobalt and 28.7 ppm silver

With those numbers from aqua regia digestion Ultratrace ICP-MS analysis, King’s Bay sent the first sample to a second lab for additional tests using ICP and ore grade analysis, with the following result:

  • 6.07% copper, 0.03% cobalt and 14.4 ppm silver

Grab samples don’t represent the entire property, King’s Bay cautioned. But the company sees further exploration warranted for next spring. The boat-accessible property’s historic work dates to historic times, when in 1863 a miner from Cornwall reportedly extracted a supply of copper and cobalt for shipment to Wales. Non-43-101 results from 1999 grab sampling near the Cousin Jack’s mineshaft showed 3.8% copper, 0.3% cobalt, 2.9 g/t gold and 10.9 g/t silver. The 200-hectare property has yet to be drilled.

Last month King’s Bay wrapped up an initial two-hole, 502-metre program at its Lynx Lake cobalt project in Labrador. Assays are expected in early January but the company reported intervals of net textured gabbro totalling 164.3 metres, along with a 14.9-metre intercept of mineralized biotite gabbro. The holes targeted the West Pit area, where the company anticipates a VTEM anomaly to range from 50 to 300 metres’ depth and about 400 metres in diameter. A highway and powerlines run through the 24,000-hectare property.

King’s Bay offered a $250,000 private placement in September.

Paved with mineralization

October 27th, 2017

Norman B. Keevil’s memoir retraces Teck’s—and his own—rocky road to success

by Greg Klein

Norman B. Keevil’s memoir retraces Teck’s—and his own—rocky road to success

Profitable right from the beginning, Teck’s Elkview mine “would become
the key chip in the consolidation of the Canadian steelmaking coal industry.”
(Photo: Teck Resources)

 

“We were all young and relatively inexperienced in such matters in those days.”

He was referring to copper futures, a peril then unfamiliar to him. But the remark’s a bit rich for someone who was, at the time he’s writing about, 43 years old and president/CEO of a company that opened four mines in the previous six years. Still, the comment helps relate how Norman B. Keevil enjoyed the opportune experience of maturing professionally along with a company that grew into Canada’s largest diversified miner. Now chairperson of Teck Resources, he’s penned a memoir/corporate history/fly-on-the-wall account that’s a valuable contribution to Canadian business history, not to mention the country’s rich mining lore.

Norman B. Keevil’s memoir retraces Teck’s—and his own—road to success

Norman B. Keevil
(Photo: Teck Resources)

Never Rest on Your Ores: Building a Mining Company, One Stone at a Time follows the progress of a group of people determined to avoid getting mined out or taken out. In addition to geoscientific, engineering and financial expertise, luck accompanies them (much of the time, anyway), as does acumen (again, much of the time anyway).

Teck gains its first foothold as a predecessor company headed by Keevil’s father, Norman Bell Keevil, drills Temagami, a project that came up barren for Anaconda. The new guys hit 28% copper over 17.7 metres. Further drilling leads to the three-sentence feasibility study:

Dr. Keevil: What shall we do about Temagami?

Joe Frantz: Let’s put it into production.

Bill Bergey: Sounds good to me.

They schedule production for two and a half months later.

A few other stories relate a crucial 10 seconds in the Teck-Hughes acquisition, the accidental foray into Saskatchewan oil, the Toronto establishment snubbing Afton because of its VSE listing, an underhanded ultimatum from the British Columbia government, getting out of the oyster business and winning an unheard-of 130% financing for Hemlo.

Readers learn how Murray Pezim out-hustled Robert Friedland. But when it came to Voisey’s, Friedland would play Inco and Falconbridge “as though he were using a Stradivarius.” Keevil describes one guy welching on a deal with the (apparently for him) unarguable excuse that it was only a “gentleman’s agreement.”

Norman B. Keevil’s memoir retraces Teck’s—and his own—rocky road to success

Through it all, Teck gets projects by discovery or acquisition and puts them into production. Crucial to this success was the Teck team, with several people getting honourable mention. The author’s closest accomplice was the late Robert Hallbauer, the former Craigmont pit supervisor whose team “would go on to build more new mines in a shorter time than anyone else had in Canadian history.” Deal-making virtuoso David Thompson also gets frequent mention, with one performance attributed to his “arsenal of patience, knowledge of the opponents, more knowledge of the business than some of them had, and a tad of divide and conquer…”

Partnerships span the spectrum between blessing and curse. International Telephone and Telegraph backs Teck’s first foray into Chile but frustrates its ability to do traditional mining deals. The Elk Valley Coal Partnership puts Teck, a company that reinvests revenue into growth, at odds with the dividend-hungry Ontario Teachers’ Pension Plan. Working with a Cominco subsidiary, Keevil finds the small-cap explorer compromised by the “ephemeral response of the junior stock market.” And smelters rip off miners. But that doesn’t mean a smelter can’t become a valued partner.

Keevil argues the case for an almost cartel-like level of co-operation among miners. Co-ordinated decisions could avoid surplus production, he maintains. Teck’s consolidation of Canada’s major coal mines helped the industry stand up to Japanese steelmakers, who had united to take advantage of disorganized Canadian suppliers. “Anti-trust laws may be antediluvian,” he states.

Keevil admits some regrets, like missing Golden Giant and a Kazakhstan gold project now valued at $2 billion. The 2008 crash forced Teck to give up Cobre Panama, now “expected to be a US$6 billion copper mine.” Teck settled a coal partnership impasse by buying out the Ontario Teachers’ share for $12 billion. Two months later the 2008 crisis struck. Over two years Teck plunged from $3.6 billion in net cash to $12 billion in net debt.

But he wonders if his own biggest mistake was paying far too much for the remaining 50% of Cominco when an outright purchase might not have been necessary. Keevil attributes the initial 50%, on the other hand, to a miracle of deal-making.

For the most part Keevil ends his account in 2005, when he relinquishes the top job to Don Lindsay. By that time the company had 11 operating mines and a smelting/refining facility at Trail. A short chapter on the following 10 years, among the most volatile since the early ’70s, credits Teck with “a classic recovery story which deserves a full chapter in the next edition of Never Rest on Your Ores.” Such a sequel might come in another 10 years, he suggests.

Let’s hope he writes it, although it’ll be a different kind of book. As chairperson he won’t be as closely involved in the person-to-person, deal-to-deal, mine-to-mine developments that comprise the greatest strength of this book—that and the fact that the author grew with the company as it became Canada’s largest diversified miner.

Meanwhile, maybe Lindsay’s been keeping a diary.

The author’s proceeds go to two organizations that promote mining awareness, MineralsEd and Mining Matters.

King’s Bay Resources to begin first-ever drill program on Labrador copper-cobalt project

October 26th, 2017

by Greg Klein | October 26, 2017

Following up on field work and airborne geophysics, King’s Bay Resources TSXV:KBG has returned to its Lynx Lake property to prepare the site for an initial drill campaign. Under focus will be a VTEM-identified anomaly about 400 metres in diameter, extending about 50 to 300 metres in depth on the property’s West Pit.

King’s Bay Resources begins first-ever drill program on Labrador copper-cobalt project

A prospector displays a sample of
massive sulphides from Lynx Lake.

Historic, non-43-101 grab samples from the area brought up to 1.03% copper, 0.566% cobalt, 0.1% nickel, 5 g/t silver, 0.36% chromium, 0.39% molybdenum and 0.23% vanadium. At least two holes totalling 500 metres are planned.

About 24,000 hectares in size, the southeastern Labrador property has a year-round highway passing through the property and an adjacent powerline. East of the highway, historic, non-43-101 grab samples assayed up to 1.39% copper, 0.94% cobalt, 0.21% nickel and 6.5 g/t silver.

Earlier this month King’s Bay wrapped up Phase I exploration at its 200-hectare Trump Island copper-cobalt project on Newfoundland’s northern coast. Assays are pending for 15 outcrop samples showing sulphidic wall rock and massive sulphide veins.

In September the company offered a private placement up to $250,000. The previous month King’s Bay closed the second tranche of a financing that totalled $402,750.

See an infographic about cobalt.

Kapuskasing expands Newfoundland copper project, plans September drilling

August 23rd, 2017

by Greg Klein | August 23, 2017

Announced in May as an LOI but now ratified, Kapuskasing Gold’s (TSXV:KAP) 100% option adds the Sterling property and its former mines to the company’s Lady Pond project near the north coast of Newfoundland. The 700-hectare addition brings Lady Pond to 2,450 hectares with exploration and mining dating to the late 19th century. The standouts include the former Sterling mine, the Twin Pond prospect about 1.5 kilometres northeast and, three more kilometres northeast, the Lady Pond past-producer.

Sterling comes with an historic, non-43-101 1960s estimate of a million tonnes averaging 1% copper that’s open in all directions. Some historic, non-43-101 intercepts showed:

  • 5.5% copper over 4.42 metres, starting at 38.1 metres in downhole depth
Kapuskasing expands Newfoundland copper project, plans September drilling

  • 2.32% over 6.1 metres, starting at 106.68 metres

  • 1.45% over 4.57 metres, starting at 50.29 metres

Of 32 holes sunk on Twin Pond, some historic, non-43-101 highlights showed:

  • 4.2% copper over 3.35 metres, starting at 82.3 metres

  • 2.16% over 3.05 metres, starting at 33.53 metres

  • 3.2% over 3.05 metres, starting at 70.14 metres

Again with the historic, non-43-101 caveat, a Lady Pond intercept assayed 2.61% copper over 8.1 metres, with no downhole depth provided.

Having finished a preliminary 3D model for Sterling and Twin Pond, Kapuskasing stated it found significant gaps in drilling between high-grade intersections. Further review of historic data will precede drilling planned to begin next month. The company also plans an induced polarization survey between Sterling and Twin Pond.

With logging road and ATV access, the Lady Pond project borders the town of Springdale. Rambler Mining and Metals TSXV:RAB operates a base metals mill at Baie Verte, 94 kilometres by road from Springdale. Rambler also holds the historic Little Deer and Whalesback copper deposits contiguously west of Lady Pond.

Subject to TSXV approval, Kapuskasing gets a 100% interest in Sterling for $25,000, 1.8 million shares and $250,000 in spending over four years. A 3% NSR applies, of which Kapuskasing may buy two-thirds for $2 million.

The property expansion reflects an acquisitive phase as Kapuskasing expands its Newfoundland and Labrador portfolio. In May the company signed an LOI on the former Daniel’s Harbour zinc mine on the island’s north. Lady Pond was one of eight April acquisitions, with other properties showing potential for copper, cobalt and vanadium. Daniel’s Harbour and Lady Pond comprise the portfolio’s dual flagships.

Read Isabel Belger’s interview with Kapuskasing Gold president/CEO Jon Armes.

Jon Armes outlines Kapuskasing’s zinc, copper and cobalt projects in Newfoundland and Labrador

August 8th, 2017

…Read more

Robert Friedland’s favourites

July 28th, 2017

Unprecedented demand calls for unparalleled grades, the industry legend says

by Greg Klein

For all that’s being said about lithium and cobalt, Robert Friedland argues that the energy revolution also depends on copper and platinum group elements. Of course he has a stake in them himself, with Kamoa-Kakula and Platreef among his current enthusiasms. Still, whether motivated by self-interest or not, the mining titan whom Rick Rule calls “serially successful” presented a compelling case for his favourite metals at the Sprott Natural Resource Symposium in Vancouver on July 25.

We’re living in “an era of unprecedented change,” said Ivanhoe Mines’ TSX:IVN founding chairperson. China’s the main cause. That country’s “breeding mega-cities prodigiously.” But one result is “incredibly toxic air… with a whole suite of health effects” from heart attacks to stroke, asthma to Alzheimer’s.

Unprecedented demand calls for unparalleled grades, the industry legend says

A crew operates jumbo rigs to bring
Ivanhoe’s Platreef mine into PGM production.

China’s not alone. Friedland pegs current global population growth at 83 million a year, with a projected 8.5 billion people populating the planet by 2030. Five billion will inhabit urban areas. Forecasts for 2050 show 6.3 billion city-dwellers. But China, notorious for its poisoned atmosphere, “is on an air pollution jihad.” It’s an all-out effort to turn back the “airpocalypse” and, with a command economy, a goal that shall be achieved.

The main target will be the internal combustion engine, responsible for about 60% of urban air pollution, Friedland said. China now manufactures 19 million cars annually, he adds. The country plans to increase output to 60 million, a goal obviously contrary to the war on pollution unless it emphasizes electric vehicles.

Like others, Friedland sees massive disruption as the economics of EVs overtake those of internal combustion engines, a scenario he expects by 2022 or 2023.

Demand for lithium-ion batteries (comprising 4% lithium, 80% nickel sulphate and 15% cobalt) has sent cobalt prices soaring. But bigger EVs will likely rely on hydrogen fuel cells, he pointed out. They’re already used in electric SUVs, pickup trucks, double-decker buses in London, trains in Germany and China, and, expected imminently, autonomous air taxis in Dubai.

Hydrogen fuel cells need PGMs. If only one-tenth of China’s planned EV output used the technology, demand would call for the world’s entire platinum supply, Friedland said.

“I would rather own platinum than gold,” he declared. Additionally, “there’s no platinum central reserve bank to puke out platinum.”

Ivanhoe just happens to have PGMs, about 42 million ounces indicated and 52.8 million ounces inferred, at its 64%-held Platreef project in South Africa.

Unprecedented demand calls for unparalleled grades, the industry legend says

Underground development progresses at the Kansoko mine,
part of the Kamoa copper deposit and adjacent to Kakula.

Electricity for the grid also ranks high among China’s airpocalyptic priorities. A study produced for the United Nations Environment Programme credits the country with a 17% increase in renewable electricity investment last year, most of it going to wind and solar. Almost $103 billion, China’s renewables investment comes to 36% of the world total.

Just as EVs remain more copper-dependent than internal combustion, wind and solar call for much more of the conductive commodity than do other types of electricity generation. Friedland sees additional disruptive demand in easily cleaned copper surfaces now increasingly used in hospitals, care homes, cruise ships and other places where infectious diseases might lurk.

He sees a modest copper supply deficit now, with a crisis possibly starting as soon as 2019. The world needs a new generation of copper mines, he said, repeating his unkind comparison of today’s low-grade, depleting mines to “little old ladies waiting to die.” The world’s largest producer, the BHP Billiton NYSE:BHP/Rio Tinto NYSE:RIO Escondida mine in Chile, is down to a 0.52% grade.

Copper recently hit a two-year high of about $6,400 a tonne. But, citing Bernstein data, Friedland said new mines would require a $12,000 price.

Not Kamoa-Kakula, though. He proudly noted that, with an indicated resource grading 6.09%, it hosts “the richest conceivable copper deposit on this planet.”

I’ve never been as bullish in my 35 years on a project.—Robert Friedland

A JV with Ivanhoe and Zjin Mining Group each holding 39.6% and the DRC 20%, Kamoa-Kakula inspires “a plethora of superlatives.” The veteran of Voisey’s Bay and Oyu Tolgoi added, “I’ve never been as bullish in my 35 years on a project.”

The zillionaire likes zinc too, which his company also has in the DRC at the 68%-held Kipushi project. With a measured and indicated grade of 34.89%, the Big Zinc zone more than doubles the world’s next-highest-grade zinc project, according to Ivanhoe. There’s copper too, with three other zones averaging an M&I grade of 4.01%.

“Everything good in the Congo starts with a ‘K’,” he said enthusiastically.

But recklessly, in light of the DRC’s controversial Kabila family. In June Ivanhoe was hit by reports that the company has done deals with businesses held by the president’s brother, Zoe Kabila, although no allegations were made of wrongdoing.

The family has run the country, one of Africa’s poorest, since 1997. Current president Joseph Kabila has been ruling unconstitutionally since November, a cause of sometimes violent protest that threatens to further destabilize the DRC.

As the New York Times reported earlier this month:

An implosion of the Democratic Republic of Congo, a country almost the size of western Europe, could spill into and involve some of the nine countries it borders. In the late 1990s, neighbouring countries were sucked into what became known as the Great War of Africa, which resulted in several million deaths.

Friedland’s nearly hour-long address made no mention of jurisdictional risk. But the audience of hundreds, presumably most of them retail investors, responded warmly to the serial success story. He’s the one who, after Ivanhoe languished at five-year lows in early 2016, propelled the stock more than 300% over the last 12 months.

King’s Bay prepares for Newfoundland copper-cobalt field program

July 26th, 2017

by Greg Klein | July 26, 2017

Update: Effective August 14, 2017, King’s Bay Gold begins trading as King’s Bay Resources TSXV:KBG.

Copper-cobalt findings dating to the 19th century have King’s Bay Gold TSXV:KBG about to begin Phase I exploration on its Trump Island project off Newfoundland’s northern coast. The company has a team ready to study historic data prior to geophysics and grab sampling on the 200-hectare property. Depending on results, Phase II could incorporate drilling.

King’s Bay prepares for Newfoundland copper-cobalt field program

The property’s exploration history dates to 1863, when a Cornish miner sunk a six-metre shaft to follow a zone of massive chalcopyrite. Mineralization reportedly expanded with depth but the technology of the time prevented further excavation. Nevertheless the Cousin Jack reportedly shipped to Wales high-grade copper-cobalt material archaically recorded as “40 pounds per fathom.”

Grab samples collected near the shaft in 1999 showed historic, non-43-101 results up to 3.8% copper, 0.3% cobalt, 2.9 g/t gold and 10.9 g/t silver.

Located seven miles south of the town of Twillingate, Trump Island has boat access to a highway 1.5 kilometres away.

Last month King’s Bay reported geophysical results from another copper-cobalt project, this one along a provincial highway in Labrador. Airborne VTEM over the 24,000-hectare Lynx Lake property revealed a shallow anomaly of high resistivity about 400 metres in diameter and 50 to 300 metres in depth. The results came from the project’s West Pit, where historic, non-43-101 grab samples showed up to 1.03% copper, 0.566% cobalt, 0.1% nickel, 5 g/t silver, 0.36% chromium, 0.39% molybdenum and 0.23% vanadium.

Lynx Lake’s summer agenda includes higher-resolution ground geophysics, possible stripping to expose bedrock south of the pit and follow-up work on historic soil samples on the property’s southeastern area, along with mapping and sampling over both areas.

The company’s portfolio also includes three Quebec properties with historic, non-43-101 cobalt results.

Earlier this month King’s Bay closed a first tranche totalling $316,250 of a private placement offered up to $725,000. The company expects to close the second tranche by the end of August. King’s Bay closed a previous financing of $938,752 in January.

Read about cobalt supply and demand.

See an infographic about cobalt.

Newfoundland newly found

June 26th, 2017

Jon Armes of Kapuskasing Gold talks with Isabel Belger about zinc, copper and cobalt

 

Jon Armes of Kapuskasing Gold talks with Isabel Belger about zinc, copper and cobalt

Isabel Belger

Isabel: I would like to introduce Jon Armes, the president and CEO of Kapuskasing Gold TSXV:KAP. Jon, good to see you again. Tell us something about your background to start with.

Jon: Hi Isabel, good to see you too. I started in the mineral exploration business back in 1993 as an investor relations consultant. I spent the better part of 10 years working for various companies exploring for gold and precious metals as well as base metals and diamonds.

In the mid-2000s I ended up working in the field alongside a couple of different geologists and spent time managing drill programs, splitting drill core, prospecting and assisting in the staking of claims. I also helped structure some companies—bringing project opportunities and public companies together.

In 2010 I was given the opportunity to run a junior exploration company called Lakeland Resources. That company merged with Alpha Exploration in late 2015 and became ALX Uranium [TSXV:AL]. I remained as president until October of 2016 after concluding a transaction with Denison [TSX:DML] on behalf of ALX.

I was appointed president of Kapuskasing Gold in February of 2016. We carried out some drilling last summer on a gold project in Timmins, Ontario, but unfortunately did not intersect anything of significance in that campaign. Since that time I have been looking for the right opportunity or opportunities to bring in to the Kapuskasing property portfolio. The Newfoundland property package seemed like the right fit, and since then we have done some consolidating to the original acquisitions announced on March 1, 2017, and then more recently added the Daniel’s Harbour zinc property to the property portfolio. The copper-cobalt projects are the Lady Pond property and the King’s Court property. The lack of systematic testing for cobalt gave rise to these properties being so interesting because, the few times cobalt was tested for, there were several anomalous values. I particularly like the short- and longer-term outlook for both copper and zinc, and these copper-cobalt projects also provide a polymetallic exposure that includes cobalt, gold and silver.

Isabel: Congratulations on your recent zinc property acquisition in Newfoundland, the Daniel’s Harbour property. What intrigued you about this project?

Jon Armes of Kapuskasing Gold talks with Isabel Belger about zinc, copper and cobalt

With breathtaking geography and bountiful geology, the Rock
and neighbouring Labrador hold potential for Kapuskasing.

Jon: The opportunity to acquire a project that was a past-producer is always an interesting one. There is an old saying in the mining business that the best place to look for a mine or a deposit is in the “shadow of a headframe.” The Mississippi Valley-type nature of these zinc deposits is also intriguing because of the difficulty in finding them. Typically they are found in an outcrop as was the case for the majority of the lenses that were mined out between 1975 and 1990. I am of the belief that there is an opportunity to find more of these lenses within the boundary of the current Daniel’s Harbour zinc property. The fact that Altius [TSX:ALS] has acquired a significant land position within the immediate area of this project only helps to reaffirm my belief. We will do some compilation of the historic work and more recent exploration on the property and incorporate some out-of-the-box thinking on how to employ some geophysics that have either not been used before or perhaps some re-interpretation. Another aspect could be a ground prospecting program that may identify an outcrop or showing on the property that has yet to be found.

Isabel: What are your exploration plans for the coming months?

Jon: Kapuskasing is currently undertaking a small financing to assist in getting things going both on the Daniel’s Harbour property and the Lady Pond copper-cobalt project. As mentioned, the first things for Daniel’s Harbour would be some data compilation and to identify some geophysical techniques to help identify some drill targets.

The Lady Pond copper-cobalt property has a drill-ready target area called the Twin Pond prospect, recently acquired to complete the consolidation of the original Lady Pond property package. We have also staked several claims to cover additional historic showings of copper-cobalt-gold and silver. The Twin Pond prospect has a non-43-101 resource of approximately one million tonnes grading 1% copper, and looks to be open in all directions. [We hope to increase this resource] with a properly designed drill program—ideally in the coming months with the right funding and availability of service companies to carry out the work.

In the immediate area of Lady Pond, there are several past-producing mines and undeveloped prospects that could turn into economic deposits…. Rambler Metals [TSXV:RAB] has several projects and properties in this area, including the Little Deer project contiguous to our Lady Pond property. There is potential with the right combination of funding and exploration success for Kapuskasing to find more than one of these deposits within the Lady Pond property, having had a good start with the Twin Pond prospect.

Isabel: How much of Kapuskasing is held by the management?

Jon: Currently insiders and parties close to the company own approximately 20% of the issued and outstanding shares. Typically the insiders participate in the financings, as will be the case in this one. We are currently looking to raise up to $750,000 in a combination of flow-through and common shares. We hope to close a first tranche financing in the coming weeks to begin deploying exploration capital.

Isabel: What is your favourite commodity besides the ones in your company?

Kapuskasing will be in a great position to take advantage of not just one but several commodity price spikes, the first of which I think will be in both copper and zinc. —Jon Armes

Jon: I do like both copper and zinc, as evidenced by the recent acquisitions. The battery technology metals are also interesting—with cobalt and lithium leading the latest charge. People forget that electricity needs copper. Wires transport the electricity from batteries and generators to the tool or outlet. I consider copper to be the most important metal for the energy metal sector. We have cobalt as a possible byproduct of the two main polymetallic projects in the Lady Pond and King’s Court projects, along with gold, silver and zinc. Kapuskasing will be in a great position to take advantage of not just one but several commodity price spikes, the first of which I think will be in both copper and zinc.

Isabel: What do you like most about your job?

Jon: I like the multifaceted aspects of running a junior exploration program; there never seems to be a dull moment. I get to meet a lot of different people in the mining and finance industry, the prospectors that generate the project ideas, and the service people that ultimately carry out the exploration of the projects with our team of geologists and technicians. The most exciting times are when we are actually carrying out a drill program. It is drilling that ultimately leads to discovery.

Isabel: That is right. Good talking to you Jon, and good luck with the drill program.

Jon: Thank you.

 

Jon Armes of Kapuskasing Gold talks with Isabel Belger about zinc, copper and cobalt

Jon Armes
president/CEO of
Kapuskasing Gold

Bio

Jonathan Armes, also known as Jon, has been the CEO and president of Kapuskasing Gold since February 9, 2016, and a director since October 8, 2014. Jon Armes has been a consultant of ALX Uranium since October 2016. Jon Armes served as the president/CEO of ALX Uranium (formerly, Lakeland Resources) from August 12, 2010, until October 2016. He has provided corporate development and investor relations services to mining exploration companies for over 15 years including Band-Ore Resources (which became part of Lake Shore Gold, which in turn joined Tahoe Resources TSX:THO) and Trelawney Mining and Exploration, an IAMGOLD TSX:IMG takeover. He graduated from the University of Guelph in 1993 with a Bachelor of Applied Science degree.

Fun facts

My hobbies: Fishing, hockey and music
Sources of news I use: News apps on my phone
My favourite airport: Vancouver
My favourite commodities: Copper, gold, zinc, cobalt
My favourite tradeshow: PDAC
With this person I would like to have dinner: Warren Buffet (talking about philanthropy, investing and life)
If I could have a superpower, it would be: Seeing into the future


Read more about Kapuskasing Gold.