Friday 3rd July 2020

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Geology and genesis

June 17th, 2020

Canadian and Australian rocks offer clues about the origin of life

by Joshua Davies, Professor, Sciences de la Terre et de l’atmosphère, Université du Québec à Montréal and Jesse Reimink, Assistant Professor, Geosciences, Pennsylvania State University | posted with permission of The Conversation | June 17, 2020

The rocks at the surface of modern Earth are broadly divided into two types: felsic and mafic. In general felsic rocks are relatively low in density—for a rock—and light in colour because they are made from whitish minerals rich in silicon and aluminium. Half Dome in California is made of granite, a felsic rock. Mafic rocks, in contrast, are relatively high in density and dark in colour because they contain minerals rich in iron and magnesium. Giant’s Causeway in Northern Ireland is made of basalt, a mafic rock.

Canadian and Australian rocks offer clues about the origin of life

The Giant’s Causeway in Northern Ireland is
an unusual formation comprising mafic rocks.
(Photo: Bruno Biancardi/Shutterstock)

The difference in density between felsic and mafic rocks means that felsic rocks are more buoyant and therefore sit at higher elevations above the earth’s mantle (the layer inside the earth between the crust and the core). For this reason, felsic rocks make up Earth’s continents whereas the lower-elevation crust under the oceans is mafic.

The mechanisms that separated the rocks at Earth’s surface into these two groups may have also created the environment needed for life to flourish 4.3 million years ago, very early in the history of Earth.

The separation into these two rock types is the result of plate tectonics: where the tectonic plates separate and move apart, the rocks below become depressurized, melt and fill in the gap between them, like the Mid-Atlantic Ridge. The rock that fills the gap between the plates is mafic.

When one plate slides below another, fluids released from the lower plate cause melting in the mantle. These melts have to pass through the upper plate to reach the surface. On their way to the surface, they undergo a series of processes called fractional crystalization, which can change mafic melts into felsic melts.

Establishing timelines

When this separation happened is a matter of great debate in earth sciences because it may allow us to determine when Earth became habitable for life. Many earth scientists believe that the weathering of continental crust may have provided the nutrients for life to thrive. Identifying when the first continents formed indicates when this may have occurred.

Earth scientists also debate whether plate tectonic processes in the past were the same as those occurring today, and whether they were even needed to form continental crust in the past. The first continental crust may have been formed through the interaction of oceanic crust and mantle plumes of heat coming from the earth’s core. Another theory suggests that continental crust formed through meteorite bombardment.

Canadian and Australian rocks offer clues about the origin of life

The former Jack Hills iron ore mine in a Western Australian
region with the world’s oldest known rocks.
(Photo: SRK Consulting)

The exact mechanism is important for understanding the history and evolution of Earth, and may help understand the processes that could be occurring on other planets.

Reviewing the records

Our recent study looked at the oldest geological material on Earth. The results suggest that Earth was already separating into these two rock types by 4.3 billion years ago—effectively since the beginning of Earth’s geological record. Our data also gave intriguing insights into the tectonic processes that may have been occurring at that time.

The origin of continental crust is debated in part because the further back in time you go, the fewer rocks there are to study. Samples from the Acasta Gneiss Complex in the Northwest Territories were found to be about four billion years old—the oldest known rocks on Earth. These Acasta Gneiss rocks are felsic and composed of tonalite-trondhjemite-granodiorite.

There are very few older samples from Earth, the most famous of which is the Jack Hills zircons. These are up to 4.3 billion years old, 300 million years older than the Acasta Gneiss. They are tiny grains of mineral zircon that have been eroded out of their parental rock (the rock in which they initially crystallized).

These zircons are found in much younger sediments in Australia, which means that it’s difficult to determine what kind of rocks these minerals originally came from, leaving open the question of whether there was continental crust during the earliest period of Earth’s history.

Continental connections

In our recent study, we compared all aspects of the chemistry of the zircon crystals from Acasta rocks to the Jack Hills zircons to see if they could have been formed in a similar environment.

Canadian and Australian rocks offer clues about the origin of life

A contrast-enhanced true colour satellite image
(Landsat 5) of the Jack Hills in Western Australia. 
(Image: Gretarsson/CC BY)

We found that the two sets of zircon grains are chemically identical, suggesting that they formed from the same kinds of rocks and likely in the same kinds of tectonic settings. This means that the earth may have started to create continental-type crust very soon after it formed.

The chemical composition of both suites of zircon crystals also suggests that they grew in magmas that originated at great depth in the earth. Deep origins for magmas are a typical sign of subduction on the modern earth.

We compared the amount of uranium in the crystals to the amount of ytterbium, a rare element. When a magma forms at great depth, the mineral garnet is often present, which gathers ytterbium. This means less ytterbium is taken up by zircon crystals, suggesting that a relative lack of ytterbium indicates that these magmas formed in deep environments.

The Jack Hills zircons are known to have crystallized at relatively low temperatures. We found that the temperatures from Acasta zircons matched exactly with the Jack Hills zircons, further indicating their similarity.

Finding the beginning

Ultimately, our results indicate that the tectonic processes occurring at the beginning of the geological record may not have been so different from the processes occurring afterwards. Evidence that things were not much different from modern Earth brings intriguing insights into the potential for the origin of life and the habitability of early Earth, possibly confirming that life was present very early in Earth’s history.

Joshua Davies receives funding from the Natural Sciences and Engineering Research Council of Canada, and l’Université du Québec à Montréal.

Jesse Reimink receives funding from Pennsylvania State University and the U.S. National Science Foundation.
The Conversation

This article is republished from The Conversation under a Creative Commons licence. Read the original article.

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Gaia Metals signs LOI for Idaho gold-silver project with historic high grades

June 4th, 2020

by Greg Klein | June 4, 2020

Impressive earlier work in one of the world’s top-ranked mining jurisdictions has brought new attention to a neglected property. Under terms of a non-binding letter of intent Gaia Metals TSXV:GMC would pick up Freeman Creek, a 599-hectare site of previous trenching, drilling and mining. Two targets about three kilometres apart have the company especially encouraged.

Gaia Metals signs LOI for Idaho gold-silver project with historic high grades

Mineralization at the Gold Dyke prospect has been traced for 457 metres along strike and 183 metres at depth. Trench samples as far back as 1910 brought obviously non-43-101 results as high as:

  • 6.86 g/t gold and 199 g/t silver over 7 metres

  • 5.49 g/t gold and 130 g/t silver over 5.8 metres

  • 19.9 g/t gold, 65 g/t silver and 1.05% copper over 3.7 metres

One grab sample reached 60 g/t gold and 1,440 g/t silver.

An historic 1970s-era drill intercept brought:

  • 0.46 g/t gold, 7.1 g/t silver and 0.1% copper over 13.7 metres

More non-43-101 assays, from two 1980s holes, showed:

  • 1.5 g/t gold and 12.1 g/t silver over 44.2 metres

  • 1.7 g/t gold and 17.1 g/t silver over 21.3 metres

Although records haven’t been found, Cominco and BHP explored Gold Dyke for large-scale copper potential during the 1990s.

The historic Carmen Creek mine prospect has delivered samples from outcrop and former workings with these non-43-101 results:

  • 14.15 g/t gold, 63 g/t silver and 1.2% copper

  • 1.8 g/t gold, 43 g/t silver and 1% copper

Should all fall into place, Gaia plans ground mapping and soil sampling, along with potential ground geophysics and summer drilling.

“The historic work at Freeman Creek appears to have only scratched the surface of this project’s potential,” said company president/CEO Adrian Lamoureux. “Coupled with a relatively simple and straightforward permitting process, we are excited to aggressively pursue this opportunity.”

Located about 15 kilometres from the town of Salmon, Freeman Creek can be reached by highway, gravel roads and trails. Last year Idaho ranked #8, up from 16th the previous year, on the most important index of the Fraser Institute Survey of Mining Companies.

A 100% interest would cost Gaia a total of $90,000, four million shares and two million warrants within a year of TSXV approval. The company would pay an additional $1 million in cash or shares on defining a gold-equivalent resource exceeding a million ounces. The vendor would retain a 2.5% NSR, half of which Gaia could buy for $1.5 million.

In Quebec’s James Bay region, Gaia’s Corvette-FCI property has yielded high-grade gold, copper-gold-silver and lithium-tantalum grades. Announced last April, a new interpretation of geophysical data found additional drilling potential. Gaia holds 100% of the project’s Corvette claims and a 75% earn-in from Osisko Mining TSX:OSK spinout O3 Mining TSXV:OIII on the FCI-East and FCI-West blocks.

Among other assets, Gaia’s portfolio includes the Pontax lithium-gold property in Quebec, the Golden silica property in British Columbia and a 40% stake in the Northwest Territories’ Hidden Lake lithium property.

Read more about Gaia Metals.

Legendary mine finder David Lowell dead at 92

May 6th, 2020

by Greg Klein | May 6, 2020

An axe injury while staking claims in central Saskatchewan helps illustrate the working life of an intrepid geologist in the 1950s. While topping trees David Lowell slashed his hand, but heavy blood loss hardly justified helicopter transport for medical attention. A few days later, as bleeding continued despite application of a rag bandage, a fellow geologist sewed up the cut with black carpet thread.

Legendary mine finder David Lowell dead at 92

Although Lowell admitted the process had him howling with pain, he concluded with stoic simplicity: “This worked fine.” They stayed in the bush for another week before heading back to Lac La Ronge, where a couple of Cree nurses examined the amateur stitch-up with amusement.

Lowell also spent time in Manitoba and the Northwest Territories as well as in British Columbia, where he worked at Highland Valley, Endako, Gibraltar and Craigmont. But the legend who passed away earlier this week was best known for discoveries farther south, starting in his native Arizona. The grandson of an Ontario-born prospector is credited with 17 major discoveries over 50 years in Arizona, Argentina, the Philippines, B.C., Chile, Peru, Ecuador and Paraguay.

Intrepid Explorer: The Autobiography of the World’s Best Mine Finder attributes significant work from others for seven of those achievements, which he categorizes as “maybe-I-was-responsible-for orebodies.” As he added, “there always are many more discoverers than discoveries.”

Lowell’s boots hit ground over much of the world but he also delivered university lectures in several countries and published widely. A longstanding collaboration with John Guilbert brought fame for the duo, better understanding of geology and many new mines through the Lowell-Guilbert Porphyry Copper Model, first published in 1970.

The model led to Lowell’s first discoveries, Kalamazoo and Vekol in Arizona, “which were remarkable at the time given the lack of visible copper mineralization at surface,” said a May 5 statement from Solaris Resources. Those finds were followed by Bajo Alumbrera in Argentina, to which Lowell acknowledged the contribution of others.

“David went on to discover the world’s largest copper deposit, La Escondida, in Chile in 1981,” Solaris pointed out. “This came from recognizing how the signature of his porphyry copper model would be modified in an extremely arid environment by a process known as ‘super leaching,’ which five prior companies exploring the property previously had failed to recognize.

“Likewise, in Peru, David identified the Northern Peru Gold Belt after library study, regional mapping, reconnaissance and sampling in a region that was not thought to be prospective. This work allowed him to narrow his focus and make the Pierina gold discovery in 1996, which was acquired by Barrick Gold for over $1 billion later that year.

“With Peru Copper, David took what was a known but under-appreciated deposit in Toromocho, relogged the existing drill core and completely reinterpreted the geology to lay the foundation for an exploration program that would increase its size by more than an order of magnitude. The project was acquired in 2007 for over $800 million.”

His last discoveries included Mirador in Ecuador, which began operation last year under a Chinese consortium, and Solaris’ flagship project Warintza in Ecuador, along with Lowell’s participation in finding Alto Parana in Paraguay. Lowell remained a Solaris consultant and strategic partner until his passing.

“Up until the very end of his life, David was busy designing programs to test his vision for the future of discovery in the Americas,” the company stated. “Innovation and ingenuity were constants throughout his legendary career.”

Mining resumes under COVID-19 but faces slow return: GlobalData

April 28th, 2020

by Greg Klein | April 28, 2020

Mining resumes under COVID-19 but faces slow return GlobalData

 

As of April 27 some 729 mines worldwide remain suspended, down from more than 1,600 shutdowns on April 3. The numbers, released by GlobalData, reflect government decisions to declare the industry an essential service, as well as implementation of new health standards and procedures. Those efforts, often involving staff reductions, contribute to “a slow return for the industry,” stated the data and analytics firm.

“Silver production is currently being severely damaged by lockdown measures,” pointed out GlobalData mining analyst Vinneth Bajaj. “As of 27 April, the equivalent of 65.8% of annual global silver production was on hold. Silver mining companies such as First Majestic, Hochschild, Hecla Mining and Endeavour Silver have all withdrawn their production guidance for 2020 in the wake of the outbreak.

Mining resumes under COVID-19 but faces slow return GlobalData

“Progress has also been halted on 23 mines under construction, including the US$5.3-billion Quellaveco copper mine in Peru, which is one of the world’s biggest copper mines currently under development…. In Chile, while a lockdown is not in force, Antofagasta has halted work on its Los Pelambres project and Teck Resources has suspended work on the Quebrada Blanca Phase II mine.”

Jurisdictions that have lifted suspensions include Quebec, India, Argentina, Zimbabwe and South Africa, GlobalData added. Countries with government-ordered lockdowns still in force include Bolivia (until April 30), Namibia (May 4), Peru (May 10) and Mexico (May 30).

At least one Mexico operator, Argonaut Gold TSX:AR, plans to re-open on May 18 under an exception for businesses operating in municipalities with few or no cases of COVID-19.

Quebec’s resumption of mining drew strong criticism from Makivik Corporation, which represents the Inuit of the province’s Nunavik region.

“Makivik will not entertain the opening of any mines at this time in Nunavik. This is very dangerous,” said corporation president Charlie Watt on April 17. “The Inuit-elected officials in the communities and in the different regional organizations need to be heard and need to make the decisions and call the shots.”

One day later production resumed at Glencore’s Raglan nickel mine. The company stated that Nunavik authorities have banned travel between the mine and regional villages to protect the local population. Local workers stay home with compensation, while the mine employs workers from the south, including Inuit who live in the south.

Without question this is taking a toll on all of our mines and service/supply companies.—Ken Armstrong, NWT and
Nunavut Chamber of Mines

Six mines still operating in Nunavut and the Northwest Territories use similar staffing precautions. “The mines are operating with reduced workforces which they must fly in by charter from as far away as eastern Canada,” said NWT and Nunavut Chamber of Mines president Ken Armstrong. “To protect vulnerable northern communities from the virus they have sent their local employees home with pay and they are maintaining costly and unplanned virus protection measures.”

Meanwhile Labrador politicians expressed concern about renewed operations at Champion Iron’s (TSX:CIA) Bloom Lake mine on the Quebec side of the Labrador Trough. On April 28 VOCM radio reported that MP Yvonne Jones asked the company to avoid the Wabush airport in her riding and transport employees entirely through Quebec. Member of the House of Assembly Jordan Brown said contractors were making unnecessary trips to the Newfoundland and Labrador side.

Another pandemic-caused Quebec mining suspension will stay on care and maintenance due to market forces. Renard owner Stornoway Diamond stated, “Despite positive signs in the diamond market in early 2020, the recent COVID-19 pandemic has resulted in the entire marketing chain and diamond price collapse.”

Prior to the suspension, Renard operated only through creditor support.

Another diamond casualty has been the Northwest Territory’s Ekati mine, which suspended operations last month. Majority owner Dominion Diamond Mines received insolvency protection on April 22.

Discovered in 1991 and opened in 1998, Ekati “provided nearly 33,000 person-years of employment, and $9.3 billion in business spending, with over half the benefits (51% of jobs and 69% of spending) going to northern residents and businesses,” the Chamber stated. “Billions of dollars in various taxes and royalties have also been paid to public and indigenous governments by the mine.”

Gaia Metals finds new drill targets through updated geophysical analysis

April 16th, 2020

by Greg Klein | April 16, 2020

A gold-polymetallic project in Quebec’s James Bay region shows additional potential following re-evaluation of previous data. On behalf of Gaia Metals TSXV:GMC, Dynamic Discovery Geoscience applied new methods and software to a 1998 induced polarization and resistivity survey over the Golden Gap area of the Corvette-FCI property. With greater geological insight, Gaia now sees a different trend of mineralization that has yet to be drilled, along with additional strike extensions, and parallel and sub-parallel trends.

Gaia Metals finds new drill targets through updated geophysical analysis

Gaia Metals’ polymetallic potential expands,
thanks to modern re-interpretation of historic data.
(Photo: Gaia Metals)

The project comprises Gaia’s 100%-held Corvette claims and a 75% earn-in from Osisko Mining TSX:OSK spinout O3 Mining TSXV:OIII on the FCI-East and FCI-West blocks.

Historic, non-43-101 results from Golden Gap include samples up to 108.9 g/t gold, and a drill intercept of 10.48 g/t gold over seven metres. Areas of interest also include the Elsass and Lorraine prospects, the latter showing an outcrop sample of 8.15% copper, 1.33 g/t gold and 171 g/t silver. Lithium-tantalum channel samples from the CV1 pegmatite reached up to 2.28% Li2O and 471 ppm Ta2O5 over six metres.

The new interpretation finds two separate trends to a previously identified signature. A northern trend strongly corresponds with the historic samples up to 108.9 g/t gold. A less-intense southern trend doesn’t correspond with high-grade sampling. Yet it was the southern trend that was drilled to follow an historic intercept of 10.5 g/t gold over seven metres, even though that trend doesn’t correlate with the mineralized zone in that drill hole.

Outcrop samples collected last year found new gold occurrences along strike to the west, “further supporting the interpreted trend in this direction and significantly amplifying the potential,” Gaia stated. “The western trend outlined in the IP-resistivity data continues to the boundary of the survey, indicating it extends further west.”

Additional areas correlate with surface samples grading between 1 and 3 g/t gold, showing targets that are “parallel to sub-parallel to the main mineralized trend and occur within an area of approximately 2.5 kilometres east-west by 1.5 kilometres north-south,” the company added. “Each of these prospective targets and trends remains to be drill-tested.”

In February the company announced a geological review that highlighted the project’s potential for nickel, copper and platinum group elements. An historic outcrop sample from the Lac Long Sud area brought 3.1 g/t gold, 1.06 g/t palladium, 0.005 g/t platinum, 7.5 g/t silver, 0.24% copper, 0.19% nickel and 411 g/t cobalt. Despite those grades, little of the historic work and none of last year’s samples were assayed for PGEs. “Hence these seemingly isolated results necessitate further geochemical analysis in future exploration programs.”

Among other assets, Gaia’s portfolio includes the Pontax lithium-gold property in Quebec, the Golden silica property in British Columbia and a 40% interest in the Northwest Territories’ Hidden Lake lithium property.

Work suspended

March 26th, 2020

Some Canadian mining and exploration dispatches during the pandemic

by Greg Klein | March 26, 2020

Shut Down Canada has largely been achieved, but not by the forces that advocated it nor—until someone finds a way of blaming this on climate change—by the doomsday belief they were pushing. Residents of our strangely quiet cities and towns watch the horror unfold elsewhere while wondering how long and hard the pandemic will hit Canada. Meanwhile, workers and business owners might consider themselves lucky if the economy fares no worse than a very serious recession.

Some Canadian mining and exploration dispatches during the pandemic

A reminder that one crisis can trigger another unwittingly came from FortisAlberta on March 23. The company that provides 60% of the province’s electricity “is taking the necessary actions and precautions to protect the health and well-being of its employees and to provide electricity service to its customers.”

The obvious but demoralizing question arises: What happens if too many key people get sick? That danger could apply to any number of essential services. Economic collapse, social disorder, a breakdown of supply chains add to the nightmarish possibilities.

All of which might not happen. In the meantime we can thank the front line workers who keep our society functioning to the extent that it does. Those one- or two-buck-an-hour temporary pay raises hardly acknowledge society’s debt to retail staff who interact constantly with a potentially plague-ridden public. Care workers for the elderly constitute another group of low-paid heroes, several of whom have already made the ultimate sacrifice.

In the meantime here are some reports on Canadian mining’s response to the crisis.

Inconsistent closures suggest an ambivalent industry

Some Canadian mining and exploration dispatches during the pandemic

IAMGOLD sidelined its Westwood operation in Quebec but
continues work on its Coté project in Ontario. (Photo: IAMGOLD)

Mining hasn’t actually been banned in Ontario and Quebec, although shutdowns of non-essential services continue to April 8 and April 13 respectively. Extensions, of course, look likely. Quebec has ordered the industry, along with aluminum smelting, to “minimize their activities.” Ontario specifically exempted mineral exploration, development, mining and their support services from mandatory closures.

Interpreting Quebec’s decree as a ban, IAMGOLD TSX:IMG suspended its Westwood gold mine in that province but continued work at its 64.75%-held, advanced-stage Coté gold project in Ontario as an “essential service.” Production continues at the company’s Burkina Faso and Suriname operations.

But regardless of government bans or directives, voluntary suspensions take place. Restrictions on travel and social distancing have made projects non-viable, while the threat of localized outbreaks looms large—not just at the job sites and accommodations, but in the isolated communities that supply much of the labour.

In Canada, that often means native communities. “They have a bad history with disproportionate impacts from epidemics,” a Vale Canada spokesperson told the Financial Post. The company put its Voisey’s Bay mine in Labrador on care and maintenance, and planned reductions at its associated Long Harbour nickel-copper-cobalt processing plant in Newfoundland.

So far alone of the Northwest Territories’ three operations, Dominion Diamond Mines announced an indefinite suspension for Ekati on March 19. The Union of Northern Workers stated its intention to grieve the manner in which its members were laid off.

Some Canadian mining and exploration dispatches during the pandemic

Having laid off its native staff, Agnico Eagle continues its Nunavut
operations largely with workers from Quebec. (Photo: Agnico Eagle)

Agnico Eagle Mines TSX:AEM made the ramp-down decision a day after Quebec’s March 23 order, after discussions with government “to get additional clarity.” The suspensions applied to three Quebec mines but the company planned “reduced operations” at Meliadine and Meadowbank in Nunavut, largely under Quebecois workers.

Five days earlier Agnico Eagle began sending home Nunavummiut staff from its Nunavut mines and exploration projects to prevent virus transmission “from a southern worker to a Nunavut worker, with the risk of it moving into the communities,” explained CEO Sean Boyd. Production was expected to continue under the remaining staff.

The following day residents blocked a road from Rankin Inlet airport to Meliadine to protest the use of replacement workers from Mirabel and Val d’Or, Quebec. Although the territory has banned travel from other jurisdictions, critical workers may apply for an exemption. They’re also required to undergo two weeks of isolation in their own region prior to travel.

From boots on the ground to fingers on the keyboard

Exploration suspensions haven’t come at a bad time for some projects, which had completed or nearly completed winter programs. Where labs remain open, assays might provide some badly needed good news.

Much of the crucial work of analyzing results and planning future exploration can be done by desktop. One example of a company with a multinational work-at-home team is Turmalina Metals TSXV:TBX, which completed a seasonal field program at its San Francisco de Los Andes gold project shortly before Argentina imposed a nation-wide quarantine. “While Turmalina maintains a corporate office in Canada our technical and managerial team operate remotely from individual home offices located in Peru, Brazil, Argentina, Canada and Asia,” states a March 23 announcement. “The current compilation, analysis and modeling of recently collected data is being done on a physically decentralized basis from these individual home offices as the company prepares for drilling.”

Follow the money

No one’s saying so out loud, but travel restrictions just might divert money from conferences, trade shows and expense accounts to actual work. Then again, money can still be squandered on low-IQ promotional campaigns produced at the kitchen table.

Every metal and mineral has a silver lining

This isn’t a sector that overlooks opportunity. Two days after Vanstar Mining Resources TSXV:VSR reported that drilling “continues without stopping” at its 25%-held Nelligan project in Quebec, the company acknowledged that majority partner IAMGOLD had suspended work. But “it should be noted that current events can also bring certain opportunities for acquiring gold projects at a lower cost,” Vanstar pointed out. The junior was merely echoing comments made by others, including BHP Group NYSE:BHP earlier this month.

With the economic outlook as confused as a professional stock-picker’s thought processes, mining’s future remains profoundly uncertain. But diminished supply can certainly help chances of rebounding demand.

And suspensions might encourage advantageous awareness, as noted by Uranium Energy Corp NYSE:UEC president/CEO Amir Adnani. “The recent global events and supply disruptions further underscore the importance of domestic supply chains for vital resources,” stated the U.S. purveyor of U3O8.

How could we live without them?

Endeavours deemed essential by Ontario and Quebec include capital markets services and agencies like the TMX Group and securities commissions. The provinces also consider alcohol and cannabis retailers essential. As if the world wasn’t already facing worse consequences, Toronto medical officer Eileen de Villa said banning booze “would lead to pretty significant health consequences.”

She didn’t specifically mention geoscientists.

The experts speak

Some fatuous remarks at PDAC provided retrospectively grim humour, as well as an exhibition of prognosticator pomposity. Here’s Mickey Fulp’s take on COVID-19, as quoted by IKN:

  • “I think it’s overblown.”

  • “All these shows are flu incubators, anyway.”

  • “I think it (i.e. infections) are going to be less this year, because people are doing things like washing their hands.”

  • “This is a blip on the radar screen. Especially in the U.S. where I’m from, because our economy is absolutely roaring and virus fears are not going to do major damage to the U.S. market.”

  • “I think it absolutely is an overreaction and the quicker it’s realized, the better.”

  • “This is a variety of flu.”

Of course to sheltered North Americans, the first week of March might seem a long time ago. So here’s Doug Casey’s insight, as published by Kitco on March 24:

“The virus itself isn’t nearly as serious, I don’t know how serious it’s going to be, but not terribly in my opinion. What I’m really shocked at, Daniela, is the degree of hysteria on the part of the powers that be. They’ve actually just gone insane.”

Click here for objective data on the coronavirus pandemic.

Policy or geology?

February 28th, 2020

What’s behind Canada’s plunging reputation among miners?

by Greg Klein | February 28, 2020

If you think that’s bad news, be glad the poll ended when it did. The Fraser Institute Survey of Mining Companies 2019 imposed a November 8 deadline on respondents. Shut Down Canada didn’t really gain momentum until a bit later.

Even so, for the first time in a decade no Canadian jurisdiction made the top 10 for the survey’s main list, the Investment Attractiveness Index (IAI). Media coverage played up the role of provincial and territorial governments in jeopardizing what was—until recently and at least by Canadians—generally considered the world’s pre-eminent mining country. In doing so, reporters followed the institute’s commentary which, in keeping with its advocacy purpose, emphasized politicians’ ability to help or hinder the industry. But a closer look suggests miners and explorers gave other concerns higher priority.

What’s behind Canada’s plunging reputation among miners?

(Image: Fraser Institute)

The survey bases the IAI on two other indices, Policy Perception and Mineral Potential. The first is determined by company responses to government actions or in-actions affecting the industry. The second (assuming an un-interfering nirvana of “best practices” by those governments) considers companies’ appraisals of geology. The survey provides separate ratings for policy and geology, but also weighs them 40% and 60% respectively to compile the IAI. The 40/60 split reflects institute intel about how companies make investment decisions.

Despite Canada’s disappearance from the IAI top 10, three provinces rated highly for Policy Perception. Alberta, Newfoundland and Saskatchewan rated sixth, eighth and ninth in the world respectively. Five Canadian jurisdictions showed Policy Perception improvements over the previous year. Moreover, the most dramatic declines from 2018 appeared in the Mineral Potential index.

“We know there’s not a lot that policy-makers can do about the geology in particular areas,” says Fraser Institute senior policy analyst Ashley Stedman. “But when we see declines on the policy index, that’s something policy-makers should be paying attention to.

“In particular we saw significant declines in Saskatchewan, which dropped from third the previous year to 11th, and that was largely the result of concerns about policy factors including taxation, regulatory duplication and inconsistencies, and trade barriers. And in Quebec we saw a decline from fourth to 18th, with uncertainties about environmental regulations and about the administration or enforcement of existing regulations. We can see from both these jurisdictions and a number of other Canadian jurisdictions that regulatory issues are escalating and this should be a serious concern for policy-makers.”

What’s behind Canada’s plunging reputation among miners?

But while Saskatchewan’s Policy Perception rating fell from first place to ninth, the province’s Mineral Potential rank fell farther, from seventh to 21st. Quebec dropped from 10th to 21st in Policy Perception but plummeted from sixth to 25th in Mineral Potential.

Other dramatic Mineral Potential declines included Manitoba (from 11th to 26th), New Brunswick (49th to 72nd), Newfoundland (18th to 50th), the NWT (fourth to 29th), Nunavut (fifth to 16th) and Yukon (10th to 22nd).

Four provinces—Alberta, B.C., Nova Scotia and Ontario—did show improvements. Still, the question remains: What the hell happened to Canadian geology?

Some causes might be resource depletion, recalcitrant commodity prices or (talk to enough CEOs and this seems very possible indeed) confusion about how to answer survey questions.

Stedman suggests another likelihood. Discoveries in some jurisdictions might dampen enthusiasm for others. “We do have to keep in mind that this is a relative ranking, so if other places are seen as more attractive, that can have an impact on other jurisdictions as well.”

Although policy factors affect just 40% of a jurisdiction’s IAI ranking, “our write-up focuses on the policy rankings as an area that policy-makers can pay attention to,” Stedman explains. In some cases governments do respond to the survey’s findings. “Reporters will often ask policy-makers to comment on the rankings.”

As for other countries, “we do get quite a bit of interest globally for this survey and we’ve seen a lot of countries and jurisdictions ask us questions about the rankings. There’s quite a lot of interest in this publication in particular.”

Confidentiality, however, prevents her from divulging how many respondents are based in Canada.

The survey provides “a policy report card for governments on areas that require improvement and areas where certain jurisdictions are performing well,” she adds.

In general we see that investment dollars will flow to jurisdictions with attractive polices, and governments need to focus on adopting competitive policies to attract valuable investment dollars that will ultimately create jobs.—Ashley Stedman,
senior policy analyst
for the Fraser Institute

With geology beyond the reach of government power, policy improvement would be Canada’s only means of re-entering the IAI’s global top 10. “In general we see that investment dollars will flow to jurisdictions with attractive polices, and governments need to focus on adopting competitive policies to attract valuable investment dollars that will ultimately create jobs.”

Whether the pre-PDAC week timing will cast a pall on the Canadian industry’s biggest annual bash remains to be seen. COVID-19 has cast a bigger pall on travel while, at time of writing, there seems nothing to stop Shut Down Canada from turning its attention to airports, hotels and convention centres.

The following charts show the global IAI top 10, Canada’s IAI top 10, Canada’s top 10 for Policy Perception and Mineral Potential, and—consoling for its lack of Canadian content—the global bottom 10.

With fewer responses this time, the 2019 survey covers 76 jurisdictions compared with 83 the previous year. Here are the global IAI rankings for 2019, with 2018 spots in parentheses.

  • 1 Western Australia (5)

  • 2 Finland (17)

  • 3 Nevada (1)

  • 4 Alaska (5)

  • 5 Portugal (46)

  • 6 South Australia (8)

  • 7 Irish Republic (19)

  • 8 Idaho (16)

  • 9 Arizona (8)

  • 10 Sweden (21)

All Canadian jurisdictions except Ontario, Alberta and Nova Scotia fell in the IAI. Here’s the list for Canada, with global numbers provided for 2019 and 2018:

  • 11 Saskatchewan (3)

  • 16 Ontario (20)

  • 18 Quebec (4)

  • 19 British Columbia (18)

  • 23 Yukon (9)

  • 26 Nunavut (15)

  • 28 Newfoundland and Labrador (11)

  • 30 Alberta (51)

  • 34 Manitoba (12)

  • 35 Northwest Territories (10)

  • 52 Nova Scotia (57)

  • 60 New Brunswick (30)

Here’s Canada’s Policy Perception ratings. Alberta, Newfoundland, Ontario, B.C. and Nunavut improved their standings.

  • 6 Alberta (14)

  • 8 Newfoundland and Labrador (18)

  • 9 Saskatchewan (11)

  • 13 New Brunswick (9)

  • 18 Nova Scotia (11)

  • 21 Quebec (10)

  • 24 Ontario (30)

  • 32 Yukon (24)

  • 36 British Columbia (44)

  • 44 Nunavut (45)

  • 50 Northwest Territories (42)

  • 53 Manitoba (33)

Mineral Potential showed Canada’s most dramatic downfalls, although Alberta, B.C., Nova Scotia and Ontario managed to move upwards.

  • 10 British Columbia (13)

  • 16 Nunavut (5)

  • 18 Ontario (20)

  • 21 Saskatchewan (7)

  • 22 Yukon (10)

  • 25 Quebec (6)

  • 26 Manitoba (11)

  • 29 Northwest Territories (4)

  • 50 Newfoundland and Labrador (18)

  • 54 Alberta (74)

  • 61 Nova Scotia (79)

  • 72 New Brunswick (49)

And finally the global IAI bottom 10:

  • 67 Nicaragua (81)

  • 68 Mali (50)

  • 69 Democratic Republic of Congo (67)

  • 70 Venezuela (83)

  • 71 Zambia (45)

  • 72 Dominican Republic (76)

  • 73 Guatemala (80)

  • 74 La Rioja province, Argentina (75)

  • 75 Chubut province, Argentina (69)

  • 76 Tanzania (66)

Download the Fraser Institute Survey of Mining Companies 2019.

Read about last year’s survey.

Open and shut cases: Ontario

January 3rd, 2020

2019-2020 brings new technology, new gold, possible cobalt but diamond depletion

by Greg Klein

2019-2020 brings new tech, new gold and possible cobalt but diamond depletion

Pure Gold’s plan to revive this Red Lake mine has deep-pocketed supporters.
(Photo: Pure Gold Mining)

 

Our survey of mine openings and closures for 2019 and 2020 continues with a look at Ontario. This is Part 3 of a series.

 

While mining sustains the electric vehicle revolution, EVs enhance sustainability at Newmont Goldcorp’s (TSX:NGT) “mine of the future.” The company announced Borden’s commercial production on October 1, eight days after an official inauguration attended by representatives from industry, government and natives. The new operation boasts “state-of-the-art health and safety controls, digital mining technologies and processes, and low-carbon-energy vehicles.” The latter distinguish Borden as Canada’s first underground mine to spurn diesel-fueled vehicles in favour of EVs.

2019-2020 brings new tech, new gold and possible cobalt but diamond depletion

Borden’s fleet of underground EVs includes
this battery-powered bolter. (Photo: Business Wire)

Borden now begins a projected 15 years of operation, although milling takes place at the company’s Timmins-region Porcupine facility, 180 diesel-burning kilometres east.

Even so, Ottawa and Queen’s Park each contributed $5 million to subsidize the environmentally correct underground vehicles.

Borden comprises one of four mines in as many continents that Newmont Goldcorp brought to commercial production in 2019—all on schedule, within budget and, the company already claims, making a profit.

Such technical prowess might make this mechanically impractical mixed metaphor surprising, but president/CEO Tom Palmer said Borden “leverages our leading land position to anchor this new gold district in Ontario.” Anchors and levers notwithstanding, he gave up other Ontario turf by selling Red Lake to ASX-listed Evolution Mining in November. Expressing no nostalgia for an operation that was once integral to Goldcorp’s existence, the deal nonetheless contributes US$375 million to a total US$1.435 billion from three recent divestitures by Newmont Goldcorp, one of 2019’s biggest merger stories.

 

2019-2020 brings new tech, new gold and possible cobalt but diamond depletion

Test mining readies Madsen for anticipated production in late 2020.
(Photo: Pure Gold Mining)

That’s not to say the company forsakes Red Lake altogether. As one of four entities together holding over 30% of Pure Gold Mining TSXV:PGM, Newmont Goldcorp backs the camp’s next miner-to-be. Other financial support comes from Rob McEwen, the man behind Goldcorp’s Red Lake success, AngloGold Ashanti NYSE:AU and especially Eric Sprott.

Having started construction in September, Pure Gold expects to start pouring yellow metal at Madsen by late 2020.

Lowering capex while speeding construction, refurbishable infrastructure from two former mines includes a 1,275-metre shaft, 27 levels of underground workings, a mill and a tailings facility.

The property gave up about 2.6 million ounces from 1938 to 1976 and 1997 to 1999. Madsen’s feasibility calls for 12.3 years to chew through a probable reserve of 3.5 million tonnes averaging 8.97 g/t for 1.01 million gold ounces. With the deposit open in all directions, Pure Gold continues exploration in hopes of extending the lifespan.

 

Ontario’s Cobalt camp, meanwhile, was much better known for silver but left a critical mineral legacy in North America’s only permitted primary cobalt refinery. With financial backing from global top cobalt producer Glencore, First Cobalt TSXV:FCC hopes to restart the facility by Q4 2020.

That depends, however, on findings of a pre-feasibility study that might get upgraded to full-feas for an initial 12-tpd operation.

2019-2020 brings new tech, new gold and possible cobalt but diamond depletion

Depending on feasibility and financing, First Cobalt
might reintroduce cobalt refining to North America.
(Photo: First Cobalt)

Commissioned in 1996 and on care and maintenance since 2015, the refinery was permitted for 12 tpd back in 2001. A possible advantage to the study’s economics might be the current improvement in cobalt prices, largely resulting from Glencore’s November suspension of its Mutanda mine in the Democratic Republic of Congo.

The shutdown erased about 20% of worldwide cobalt production, according to Benchmark Mineral Intelligence.

Should the 12-tpd scenario work out, First Cobalt plans another feasibility study for an expansion to 55 tpd in 2021, which would place the company fourth in cobalt refining outside China.

Glencore loaned US$5 million to fund the studies and could advance up to US$40 million for rehab work, to be repaid by processing Glencore feed. “The refinery will be an important strategic asset for the North American market and we look forward to working with First Cobalt to help the asset fulfill its potential,” said Nico Paraskevas, Glencore’s head of copper-cobalt marketing.

Faintly suggesting a possible North American supply chain, First Cobalt’s portfolio includes an inferred resource at the Iron Creek cobalt-copper project in Idaho. On its Ontario property, the company drilled some 23,300 metres in 2017 and 2018 around former operations which had historically been mined for silver with cobalt-copper byproducts.

 

Turning to the James Bay region, this diamond mine’s closure might have been preventable but Victor lived up to its name in a number of ways. The shutdown, for example, could have happened nearly six years earlier. Winter road blockades in 2013 almost prevented arrival of heavy crucial supplies that couldn’t be flown in. Some of the protesters from the Attawapiskat reserve 90 kilometres east wanted to renegotiate the Impact Benefit Agreement. Others reportedly wanted their dismissals rescinded.

2019-2020 brings new tech, new gold and possible cobalt but diamond depletion

As humans replant a surrounding forest,
nature converts this 11-year mine to a northern lake.
(Photo: De Beers)

As quoted in the Timmins Daily Press, De Beers’ external and corporate affairs director Tom Ormsby warned that “Victor is a very solid, steady mine but it can’t keep taking all of these financial hits.”

Ontario Provincial Police initially refused to enforce a court order against the blockade, then finally moved in after protesters left voluntarily. Transport resumed and Victor lived out the rest of its nearly 11-year lifespan. Mining ended in early March 2019, by which time the total output of 8.1 million carats far surpassed the company’s original estimate of six million. Processing continued on stockpiled ore until late May.

But Tango, a smaller, lower-grade kimberlite seven kilometres away, might have added another five or six years of mining. Attawapiskat representatives, however, declined De Beers’ efforts to consult.

Victor’s closure leaves De Beers with just one mine outside Africa. The company holds the majority of a 51%/49% JV with Mountain Province Diamonds TSX:MPVD on Gahcho Kué in the Northwest Territories. De Beers put its NWT Snap Lake mine on extended care and maintenance in late 2015 as construction of Gahcho Kué neared completion. Efforts to sell Snap Lake proved unsuccessful.

But the global giant reiterated its interest in Canada with the 2018 purchase of Eric Friedland’s Peregrine Diamonds. That brought De Beers the Chidliak project on Baffin Island, with two of 74 kimberlites currently hosting inferred resources.

As for Victor, a $15.4-million reclamation program that began years earlier had planted its millionth tree within weeks of closure.

This is Part 3 of a four-part series.

Open and shut cases: North

December 18th, 2019

How do the territories’ mine openings compare with closures for 2019 and 2020?

by Greg Klein

This is Part 1 of a four-part series.

  • See Part 2, covering the western provinces.
  • See Part 3, covering Ontario.
  • See Part 4, covering Quebec and Atlantic Canada.
  •  

    One indication of the state of mining involves the vital statistics of births and deaths—the new mines that arrived and the old mines that left. To that end we survey each Canadian region for some of the major gains and losses that occurred over the past year or are expected for the next. The first of this multi-part series looks at the country’s three northern territories, with each distinct jurisdiction contributing to a study in contrasts.

    Yukon

    Yukon without mining? That might surprise people better acquainted with the territory’s past than its present. But such was the case for nearly a year, following the suspension of Minto, Yukon’s sole remaining hardrock mine up to 2018. Nevertheless operations returned to this fabled mining region in September as Victoria Gold TSXV:VIT celebrated Eagle’s debut. By late November the company reported 10,400 ounces of gold and 1,600 ounces of silver from the heap leach operation.

    How do Canada’s mine openings compare with closures in 2019 and 2020?

    Victoria Gold finished construction a month early on
    Yukon’s largest-ever gold mine. (Photo: Victoria Gold)

    Less than two weeks later the company unveiled an updated feasibility study raising the annual production target for the territory’s largest-ever gold mine from 200,000 to 220,000 gold ounces, based on a 20% increase in proven and probable reserves for the Eagle and Olive deposits. Victoria expects to reach commercial production in Q2 2020.

    By mid-October Minto came back to life under LSE-listed Pembridge Resources. Capstone Mining TSX:CS had placed the underground mine on care and maintenance in 2018, after about 11 years of continuous operation, as acquisition negotiations with Pembridge stalled. But the companies sealed the deal last June. Within weeks of restart Pembridge reported 1,734 dry metric tonnes of copper-gold-silver concentrate. Proven and probable reserves totalling 40,000 tonnes copper, 420,000 ounces silver and 45,000 ounces gold give Minto an estimated four more years of production.

    Among the most advanced Yukon projects is BMC Minerals’ Kudz Ze Kayah, a zinc deposit with copper, lead, gold and silver. The privately owned UK-based company reached feasibility in June and hopes to begin at least nine years of mining in 2021.

    Environmental/socio-economic reviews continue into Newmont Goldcorp’s (TSX:NGT) Coffee gold project and Western Copper and Gold’s (TSX:WRN) Casino polymetallic project. Should Casino make it into operation, the copper-gold-silver-molybdenum operation would be by far the territory’s largest mine.

    Read more about Yukon mining.

    Northwest Territories

    Confidence in the territorial economy fell last October when Moody’s downgraded a $550-million bond issued by Dominion Diamond. “There’s no plan in place to extend the mine life at a time when the debt is coming closer and closer to coming due,” the credit ratings agency’s Jamie Koutsoukis told CBC. “We continue to see a contraction in the time they have to develop this mine plan.”

    Part of the Washington Group, Dominion holds a majority stake in Ekati and 40% of Diavik, where Rio Tinto NYSE:RIO holds the remaining 60%. Along with De Beers’/Mountain Province Diamonds’ (TSX:MPVD) Gahcho Kué, the three diamond operations comprise the territory’s largest private sector employer.

    How do Canada’s mine openings compare with closures in 2019 and 2020?

    Agnico Eagle once again laid claim to Arctic riches with the
    Amaruq satellite deposit, over 300 kilometres west of Hudson Bay.
    (Photo: Agnico Eagle)

    In an October presentation before the territory’s newly elected legislative assembly, the NWT and Nunavut Chamber of Mines urged the government to safeguard the economy by improving investor confidence in the mining industry.

    An election year in the NWT and Canada-wide, 2019 brought optimistic talk and initial funding for the NWT’s Slave Geological Province Corridor and Nunavut’s Grays Bay Road and Port, two transportation proposals that would offer enormous potential for mineral-rich regions in both territories.

    Nunavut

    “Whispers could be heard throughout the room as intervenors turned to their colleagues. Members of the audience turned their heads, looking for Baffinland’s reaction to what was unfolding. Baffinland officials sat stone-faced, sometimes crossing their arms and looking down at the table as [Nunavut Tunngavik Inc. president Aluki] Kotierk spelled out the motion.”

    That was the scene described by the Nunatsiaq News as the Nunavut Impact Review Board abruptly suspended hearings into Baffinland Iron Mines’ $900-million Phase II expansion plans for Mary River. The proposals, already accepted by Ottawa, include building a railway to replace a 100-kilometre road north to the company’s Milne Inlet port and doubling annual production to 12 million tonnes iron ore. The new railway proposal comes in addition to a previously approved but un-built 150-kilometre southern rail link to a harbour that had been planned for Steensby Inlet.

    The company maintains that expanded production and a northern rail line will be crucial to the existing operation’s viability. Responses at public hearings ranged from support to skepticism and outright opposition. Within weeks of the hearings’ suspension and a month ahead of a scheduled layoff, Baffinland let go 586 contractors who had been working on expansion preparations.

    How do Canada’s mine openings compare with closures in 2019 and 2020?

    About 290 kilometres southeast of Meadowbank, Agnico
    Eagle celebrated Meliadine’s first gold pour in February.
    (Photo: Agnico Eagle)

    Despite all that, operations continue at Mary River and Nunavut remains a bright spot in Canadian mining.

    That’s largely due to Agnico Eagle TSX:AEM, which brought two new operations to the territory. Meliadine began commercial production months ahead of schedule in mid-May, followed by Amaruq in late September.

    As a satellite deposit, Amaruq brings new life to the Meadowbank mine and mill complex 50 kilometres southeast. With the latter mine wrapping up its ninth and last year of operation, Amaruq’s open pit offers an estimated 2.5 million ounces up to 2025. Should hoped-for permitting come through in late 2020, a Phase II expansion could broaden the lifespan. Meanwhile drilling seeks to upgrade the project’s underground resource.

    Meliadine began with underground production but has an open pit scheduled to come online by 2023. Combined open pit and underground reserves of 3.75 million gold ounces give the operation a 14-year life.

    TMAC Resources’ (TSX:TMR) expansion plans moved forward in October as construction began on an underground portal to Madrid North, a fully permitted deposit that could enter production by late 2020. The new operation’s probable reserves of 2.17 million gold ounces far overshadow the company’s other three Hope Bay deposits, which total 3.59 million ounces proven and probable.

    By comparison, the current Doris operation hosts 479,000 ounces proven and probable. Hope Bay has updated resource/reserve and prefeas studies scheduled for Q1 2020.

    This is Part 1 of a four-part series.

  • See Part 2, covering the western provinces.
  • See Part 3, covering Ontario.
  • See Part 4, covering Quebec and Atlantic Canada.
  • Gaia Metals applies new geophysical analysis to Quebec polymetallic project

    December 11th, 2019

    by Greg Klein | December 11, 2019

    This type of geophysical survey hasn’t changed much in two decades, but the technology of evaluation has. With that in mind, Gaia Metals TSXV:GMC (formerly 92 Resources) plans an up-to-date re-analysis of existing IP-resistivity data from its Corvette-FCI property. The process should offer a cost-effective method of gaining new insight into the project.

    Gaia Metals applies new geophysical analysis to Quebec polymetallic project

    Gaia Metals’ Corvette-FCI project has already shown
    impressive sample results for gold, copper and lithium.

    The James Bay-region property has so far yielded high-grade samples of gold, copper-gold-silver and lithium-tantalum. Now the company plans to apply new technology to data collected up to 2000.

    IP-resistivity surveys have proven “well-suited to detect near-surface disseminated sulphide mineralization (IP anomalies), as well as areas of alteration and/or silicification (resistivity anomalies),” Gaia stated. “This geophysical tool is commonly used in greenstone-hosted gold and base metal exploration and is often effective at qualifying drill targets initially developed from surface mapping and sampling. With the mineralization styles identified at Corvette-FCI, coupled with the thin overburden cover in the area, IP-resistivity offers an efficient sub-surface scan at good resolution and reasonable cost.”

    The original survey covered two grids: Golden Gap (now known as FCI West) and Island Lake (FCI East), which includes the Lac Bruno boulder field. IP targets from the original evaluation have yet to be drilled, “further highlighting the value in modern re-processing to prioritize the targets,” Gaia added.

    The company expects to conduct new surveying along the property’s Maven trend, extending east across the Lac Smokycat-SO, Lorraine and Elsass showings, where historic sampling brought impressive copper-gold-silver grades. Expected for completion next spring, the survey will precede ground mapping and sampling scheduled for June and July.

    Emphasizing the project’s polymetallic promise were surface samples released in September from last summer’s field program. Lithium grades from six newly found pegmatites reached up to 4.72% Li2O, while tantalum numbers included 564 ppm Ta2O5. Gold samples included a Lac Bruno boulder assay as high as 11.9 g/t. A Lorraine outcrop featured 8.15% copper, 1.33 g/t gold and 171 g/t silver.

    The project consists of Gaia’s 100%-held Corvette claims and a 75% earn-in from Osisko Mining TSX:OSK spinout O3 Mining TSXV:OIII on the FCI-East and FCI-West blocks.

    Among other assets, Gaia’s portfolio includes the Pontax lithium-gold property in Quebec, the Golden silica property in British Columbia and a 40% stake in the Northwest Territories’ Hidden Lake lithium property.

    Last week the company closed a private placement of $412,199.