Wednesday 7th December 2016

Resource Clips


Posts tagged ‘ontario’

Opportunism knocks

December 5th, 2016

First Mining Finance found bad times beneficial for good deals

by Greg Klein

Struggling junior? Not this company. Since its trading debut in April 2015, First Mining Finance TSXV:FF has compiled 25 projects covering some 300,000 hectares, from early stage to a PEA with 4.4 million gold ounces indicated. Just as aggressively, the company boosted its treasury to a current $35 million. Now First Mining looks forward to a $21-million exploration and development program for 2017 that includes 47,000 metres of drilling.

“We were able to execute on the vision of the company, which last year was to take advantage of the bear market and acquire projects,” VP of investor relations Derek Iwanaka explains. “I don’t know of any other company that was able to acquire as many projects, or projects as good as we got, during that period.”

First Mining Finance found bad times beneficial for good deals

Located in northwestern Ontario’s Birch-Uchi greenstone belt,
First Mining’s 32,448-hectare Springpole flagship has an
updated PEA scheduled for next year.

Certainly there were deals to be had for canny acquisitors. But that was while many other companies faced financing difficulties. First Mining bucked the trend last August by closing a $27-million private placement. How did they pull that off?

“Quite easily,” responds Iwanaka. “We were literally turning down millions of dollars. We had over $70 million in orders but we didn’t want that kind of dilution. So we just took the $27 million. That should carry us for at least the next few years, including all the drilling and overhead.”

First Mining seems to have something that eludes others.

“First of all we have Keith Neumeyer at the helm, who runs a multi-billion-dollar company as it stands,” says Iwanaka. “Keith has been adept at starting companies during very bad times and manoeuvring them so when times are good we can reap the rewards for our shareholders.”

Among companies founded by the First Mining director were First Quantum Minerals TSX:FM and First Majestic Silver TSX:FR, where Neumeyer’s president/CEO. First Majestic acts as a sort of mentor to First Mining, placing some FR directors in FF’s management and board, helping to get the new company started, lending it about $1 million, vending three Mexican properties and even providing office space.

Among considerations behind an acquisition are “size and quality of the project,” Iwanaka points out. “We look at projects with good grade, scalability, exploration upside. The jurisdiction’s quite important to us. We’re basically looking at North America, but not the North. We will look at South America as well. Quebec, Ontario and Newfoundland are our favourite places although we could go to other provinces too. In the U.S. we see Nevada and Arizona as fairly mining-friendly states. We could probably look at New Mexico as well. We do have some early-stage properties in Mexico, where First Majestic has its base, but we certainly focus on Canada.”

As for commodities, “we particularly like gold but silver, platinum and palladium are also attractive, as well as base metals—anything that’s exchange-tradeable.”

Other factors include “the price of the projects, the holding cost, the infrastructure. In many cases the projects we take already have roads and power lines going to them.”

If gold’s the company’s focus, the Springpole flagship explains why. Described as one of Canada’s largest undeveloped gold projects, the northwestern Ontario potential open pit came with the past owner’s 2013 PEA. Using a 0.4 g/t gold cutoff, the 2012 resource showed:

  • indicated: 128.2 million tonnes averaging 1.07 g/t gold and 5.7 g/t silver for 4.41 million ounces gold and 23.8 million ounces silver

  • inferred: 25.7 million tonnes averaging 0.83 g/t gold and 3.2 g/t silver for 690,000 ounces gold and 2.7 million ounces silver

First Mining has work underway to bring the resource and PEA up to date. But looking back at 2013, the report calculated a post-tax NPV of US$388 million using a 5% discount, with a 13.8% post-tax IRR. Initial capex came to US$438 million with payback in 35 months of an 11-year mine life.

First Mining Finance found bad times beneficial for good deals

Visible gold was one attraction of the Goldlund project,
which has another 27,000 metres of drilling planned.

“We expect the updated PEA will be even more robust,” Iwanaka says. “The U.S. dollar has appreciated since 2013, when it was at par. We’re also looking at increasing the recovery and the pit shell. Those three things could substantially improve the economics and we hope to have the new PEA out probably by the first half of next year.”

With assays pending, a four-hole, 1,712-metre fall program provided metallurgical fodder. Next summer’s agenda calls for another 6,000 metres of infill to upgrade the resource. In the meantime, pre-permitting environmental and baseline work will soon begin.

A newer acquisition gets even more rig attention next year. Goldlund, about 60 kilometres north of Dryden and roughly 200 klicks south of Springpole, has 27,000 metres planned to upgrade the resource and work towards an eventual PEA. The former open pit and underground operation came with an estimate that First Mining considers an historic non-43-101. Using a 0.4 g/t gold cutoff, it showed:

  • measured and indicated: 19.1 million tonnes averaging 1.94 g/t for 1.19 million ounces gold

  • inferred: 25.8 million tonnes averaging 2.51 g/t for 2.08 million ounces

Cameron, maybe another 100 kilometres south of Goldlund, gets up to 9,000 metres of infill to pump up the measured and indicated prior to PEA. Using a 0.5 g/t cutoff, a 2015 resource from Chalice Gold Mines TSX:CXN showed:

  • measured: 3.72 million tonnes averaging 2.64 g/t for 316,000 ounces gold

  • indicated: 4.1 million tonnes averaging 1.92 g/t for 253,000 ounces

  • inferred: 14.5 million tonnes averaging 1.92 g/t for 894,000 ounces

Moving to southwestern Newfoundland, Hope Brook will see 5,000 metres of exploration and infill. A high 3 g/t gold cutoff gives the current resource:

  • indicated: 5.5 million tonnes averaging 4.77 g/t for 844,000 ounces gold

  • inferred: 836,000 tonnes averaging 4.11 g/t for 110,000 ounces

Again, a resource upgrade precedes a PEA, this one slated for late 2017.

Back in Ontario and roughly 110 kilometres northeast of the Springpole flagship, autumn drilling has wrapped up at Pickle Crow. Assays from the nine-hole, 1,319-metre campaign are expected in early 2017. The former mine came with a 2011 inferred resource that used a 2.25 g/t gold cutoff for an underground deposit and a 0.35 g/t cutoff for an open pit deposit:

Underground

  • 6.52 million tonnes averaging 5.4 g/t for 1.14 million ounces gold

Open pit

  • 3.63 million tonnes averaging 1.1 g/t for 126,000 ounces

Total

  • 10.15 million tonnes averaging 3.9 g/t for 1.26 million ounces

With assays to come, drilling to do and announcements for other North American projects anticipated, First Mining plans a steady news flow, says Iwanaka.

Absolutely Abitibi

November 18th, 2016

BonTerra Resources gets aggressive in Quebec gold country

by Greg Klein

BonTerra Resources gets aggressive in Quebec’s gold country

A diagram shows how far the company has progressed
beyond the 2012 resource area, outlined in blue.

 

With a standout interval of 70 grams per tonne gold over 5.5 metres, BonTerra Resources’ (TSXV:BTR) November 16 batch of assays brought further evidence of a good Abitibi address. As president/CEO Nav Dhaliwal emphasizes, “This is all new drilling, well outside the resource area, and we’re going to continue expanding.” Primed with enthusiasm, financing and a better understanding of the geology, BonTerra now hopes to connect its Gladiator project’s zones across a potential strike length of 1,200 metres.

Some highlights from the most recent seven holes show:

Hole BA-16-26

  • 19.6 g/t gold over 1 metre, starting at 412 metres in downhole depth

BA-16-30

  • 4.7 g/t over 3 metres, starting at 370 metres

BA-16-38

  • 12.4 g/t over 4 metres, starting at 769 metres
  • (including 24.3 g/t over 2 metres)

BA-16-39

  • 1.5 g/t over 10 metres, starting at 723 metres

  • 70 g/t over 5.5 metres, starting at 813.5 metres
  • (including 191.4 g/t over 2 metres)

  • 3.1 g/t over 5 metres, starting at 846 metres

True widths weren’t available.

BonTerra Resources gets aggressive in Quebec’s gold country

A cold climate will complement Bonterra Resources’ drill campaign.

The drill season started on a 600-metre strike reached last May with an intercept of 137.4 g/t over 2.5 metres. This week BA-16-39 revealed its star interval at the eastern extent of the east-plunging structure, below 600 metres in vertical depth. BA-16-38 extended the zone another 50 metres deeper and 100 metres to the east. That outlines Gladiator’s zones to 650 metres in depth and 700 metres in strike. Meanwhile, assays are pending for other completed holes.

But as Dhaliwal says, “We’re not stopping there.” Now with a second rig at work, drilling will sink deeper, as well as farther east and west. Should the program succeed in connecting the eastern zones with the Rivage zone, currently over 300 metres away, the 7,563-hectare property would have the potential 1.2-kilometre strike.

With a 4 g/t cutoff, Gladiator’s 2012 resource estimate shows:

  • inferred: 905,000 tonnes averaging 9.37 g/t for 273,000 ounces gold

A resource update might arrive in late spring or early summer, Dhaliwal says. Well into a 25,000-metre 2016 program, drilling will continue through the winter. “That’s the most efficient time to work,” he points out. “This property is covered in a foot to six feet of water. Right now we’re land-based, so we’re shooting down towards it. So winter gives us an advantage, we’ll be able to get right on top of the structure.”

Describing the crew as “lean and mean,” Dhaliwal adds, “I couldn’t be prouder of our geological team, headed by a very experienced individual, Dale Ginn.” The VP of exploration’s more than 30-year career includes service with Kerr Mines, SGX Resources, San Gold, Harmony Gold Canada, Hudson Bay Mining and Smelting, and Goldcorp TSX:G, among others.

Last winter’s relative warmth limited BonTerra to about 20 holes, but Dhaliwal’s hoping this year’s temperatures favour a more aggressive campaign.

Looking southwest from Gladiator’s position on the Casa Berardi fault zone to the Cadillac-Larder Lake fault zone just inside Ontario, BonTerra holds the 2,165-hectare Larder Lake project. The property came with estimates, which BonTerra treats as historic and non-43-101, for two deposits just over a kilometre apart. Using 2.5 g/t gold cutoffs, they show:

Bear Lake

  • inferred: 3.75 million tonnes averaging 5.7 g/t for 683,000 ounces gold

Cheminis

  • indicated: 335,000 tonnes averaging 4.07 g/t for 43,800 ounces gold

  • inferred: 1.39 million tonnes averaging 5.2 g/t for 233,400 ounces

As a past-producer, Cheminis reportedly turned out 7.6 million gold ounces at an average 3.7 g/t from depths to 315 metres.

The historic estimates predate some 59 holes totalling over 25,000 metres sunk by Gold Fields NYSE:ADR. Dhaliwal says the South African miner worked the property up to 2012, when the company slashed international exploration spending. “They left just under $6 million of work—of clean work, mind you. We’ve seen the logs and core. Dale’s hired a project manager for the Ontario side and we’ll get started on a 43-101.”

The property’s Fernland area adds a third mineralized body, with all three open at depth and within a 3.2-kilometre potential strike.

While talking about either property, Dhaliwal at times can barely contain his enthusiasm. Financing suggests he’s hardly alone in his confidence. Between December 2015 and last June, the company raised over $10.38 million. “We’re fully cashed up and we’re moving forward so stay tuned—we’re going to show you more.”

See an infographic about BonTerra Resources.

First Mining Finance drilling two Ontario gold projects

November 16th, 2016

by Greg Klein | November 16, 2016

A well-financed company with an opportunistic approach to low valuations, First Mining Finance TSV:FF has begun another Ontario drill program. Announced November 15, the Pickle Crow gold project gets up to eight holes totalling 1,100 metres. The company began drilling its Springpole gold project last month.

First Mining Finance drilling two Ontario gold projects

Infrastructure remains from over
30 years of mining at Pickle Lake.

The first such program on Pickle Crow since First Mining took over PC Gold a year ago, the rig will target the western extension of the project’s Core mine trend in hopes of finding high-grade, vein-type gold.

Pickle Crow produced 1.45 million ounces of gold and 168,757 ounces of silver between 1935 and 1966.

A 2011 inferred resource used a 2.25 g/t gold cutoff for an underground deposit and a 0.35 g/t cutoff for an open pit deposit:

Underground

  • 6.52 million tonnes averaging 5.4 g/t for 1.14 million ounces gold

Open pit

  • 3.63 million tonnes averaging 1.1 g/t for 126,000 ounces

Total

  • 10.15 million tonnes averaging 3.9 g/t for 1.26 million ounces

The property lies about seven kilometres from a provincial highway, about 400 kilometres north of Thunder Bay.

“With drilling at our Springpole gold project well underway, and with drill programs planned for our other mineral properties in the coming months, this is an exciting time for First Mining as we take the initial steps toward enhancing the value of the assets we have accumulated over the past year and a half,” said president Patrick Donnelly.

Roughly 110 kilometres southwest, the company began Springpole’s 1,500-metre program last month for metallurgical tests. First Mining plans an updated PEA for H1 2017. Springpole comes with a 2012 resource that used a 0.4 g/t gold cutoff for an open pit deposit:

  • indicated: 128.2 million tonnes averaging 1.07 g/t gold and 5.7 g/t silver for 4.41 million ounces gold and 23.8 million ounces silver

  • inferred: 25.7 million tonnes averaging 0.83 g/t gold and 3.2 g/t silver for 690,000 ounces gold and 2.7 million ounces silver

First Mining’s portfolio holds 25 North American assets. Five projects in Ontario, Quebec and Newfoundland have resource estimates. The company closed a $27-million private placement in August, raising its treasury to $37.3 million at the time.

Charles Desjardins outlines his company’s plans on becoming the largest claimholder in Ontario’s Confederation Lake greenstone belt

November 14th, 2016

…Read more

Ontario backs deep-mining research with $2.5-million grant

November 2nd, 2016

by Greg Klein | November 2, 2016

Sudbury’s status as a global capital of mining R&D gained additional recognition with a $2.5-million provincial grant. Announced at the Mining Innovation Summit on November 1, the money goes to the non-profit Centre for Excellence in Mining Innovation and its Ultra Deep Mining Network.

Ontario backs deep-mining research with $2.5-million grant

The UDMN works to improve safety, efficiency and sustainability of operations at depths below 2.5 kilometres. While China has announced support for deep-mining research as part of its Three Deep program, the alarming accident rate at South African mines has been attributed partly to the unprecedented depths of some operations, one breaching the four-kilometre mark.

Ontario hosts two of the world’s 10 deepest mines, according to Mining-Technology.com. Vale’s Creighton nickel-copper mine in Sudbury holds tenth place, at about 2.5 kilometres’ depth. Glencore’s Kidd copper-zinc mine in the Timmins region holds eighth place at slightly more than three kilometres. The other eight mines are all South African gold operations.

Another type of research goes on at Creighton, which hosts the SNOLAB physics experiments including the Sudbury Neutrino Observatory that won Art McDonald a Nobel Prize in 2015.

Why Creighton? As quantum physicist Damian Pope told the National Post, the lab’s two kilometres of rock shields neutrinos from other sub-atomic particles, allowing them to be studied in relative isolation. That research, conducted where the sun don’t shine, somehow helped eggheads understand how the sun shines.

As for mining research, Sudbury hosts nine institutes dedicated to innovation, the province stated. Ontario now has 42 operating mines supporting 26,000 direct jobs and 50,000 additional jobs associated with mining and processing, according to a statement from mines minister Michael Gravelle. He valued Ontario’s 2015 mineral production at $10.8 billion.

The Ministry of Northern Development and Mines hosted the two-day Sudbury summit to bring together “government, industry, academia, thought leaders, entrepreneurs, as well as research and innovation organizations” to further encourage mining innovation.

Read about Laurentian University’s Metal Earth project.

Pistol Bay Mining plans November drilling on Dixie zinc projects in Ontario

October 26th, 2016

by Greg Klein | October 26, 2016

It’s neither the land of cotton nor of traditional jazz, but of zinc with additional metals. And that’s why Pistol Bay Mining TSXV:PST has a November drill program planned for three of its western Ontario Dixie properties. Totalling about 1,900 hectares, Dixies 17, 18 and 19 host lenses of volcanogenic massive sulphides with zinc, copper, silver and minor gold in the Confederation Lake greenstone belt southeast of Red Lake.

Pistol Bay Mining plans November drilling on Dixie zinc projects in Ontario

All three have historic zinc-copper assays.

A review of previous geophysics will help determine drill targets for the three zones. Additionally, Pistol Bay proposes confirmation holes for Dixie 17 and 18.

Also on October 25, the company announced a private placement of up to $820,000. Pistol Bay closed a $563,450 placement in August.

Earlier this month the company announced a letter of intent to acquire regional properties from AurCrest Gold TSXV:AGO, which would make Pistol Bay the greenstone belt’s largest claimholder. The 5,136-hectare package includes a zinc-copper-silver resource and an historic, non-43-101 estimate.

In Saskatchewan’s Athabasca Basin, the company has a joint venture with a Rio Tinto NYSE:RIO subsidiary on the C-5 uranium property. Having earned 75% of its option so far, Rio intends to acquire the full 100%.

See an infographic: Eleven things every metal investor should know about zinc.

Nickel One Resources moves closer to PGE-copper-nickel acquisition in Finland

October 19th, 2016

by Greg Klein | October 19, 2016

Nickel One Resources moves closer to Finnish PGE-copper-nickel acquisition

Over $10 million in previous work has given Lantinen Koillismaa
resource estimates for two potential open pits.

Nickel One Resources’ (TSXV:NNN) Finland entry took another step forward with a binding letter agreement announced October 19. Already holding the Tyko project in western Ontario, Nickel One would get a 100% interest in Finore Mining’s (CSE:FIN) Lantinen Koillismaa platinum group element-copper-nickel project in north-central Finland. An LOI was announced in August.

The property would come through the purchase of Finore subsidiary Nortec Minerals Oy in a deal costing five million shares and 2.5 million warrants exercisable at $0.12 for two years. Nickel One has paid $50,000, which would be applied to a private placement of up to $100,000 into Finore following due diligence.

Benefiting from over $10 million in previous work, LK has 2013 resource estimates for two potential open pits.

The Kaukua deposit shows:

  • indicated: 10.4 million tonnes averaging 0.73 g/t palladium, 0.26 g/t platinum, 0.08 g/t gold, 0.15% copper, 0.1% nickel and 65 g/t cobalt

  • inferred: 13.2 million tonnes averaging 0.63 g/t palladium, 0.22 g/t platinum, 0.06 g/t gold, 0.15% copper, 0.1% nickel and 55 g/t cobalt

The Haukiaho deposit has three zones totalling:

  • inferred: 23.2 million tonnes averaging 0.31 g/t palladium, 0.12 g/t platinum, 0.1 g/t gold, 0.21% copper, 0.14% nickel and 61 g/t cobalt

The acquisition would bring Nickel One into “a mining-friendly jurisdiction with some of the best infrastructure in the world,” commented president Vance Loeber. The project also provides “a foothold in Finland from which we will be taking a hard look at other opportunities to continue to build a strong portfolio of projects,” he added.

Read more about Nickel One Resources and the Lantinen Koillismaa acquisition.

Pistol Bay Mining to take largest position in Ontario’s VMS-rich Confederation Lake

October 19th, 2016

by Greg Klein | October 19, 2016

Pistol Bay Mining to take largest position in Ontario’s VMS-rich Confederation Lake

Pistol Bay’s holdings will cover a 31-kilometre length of the VMS-rich Confederation Lake greenstone belt.

 

A new acquisition would make Pistol Bay Mining TSXV:PST the biggest claimholder in Ontario’s Confederation Lake greenstone belt. The 5,136-hectare package comprises all the regional claims held by AurCrest Gold TSXV:AGO and includes a zinc-copper-silver resource as well as an historic, non-43-101 estimate. Along with Pistol Bay’s optioned Dixie and Dixie 3 properties, the letter of intent announced October 19 would increase the company’s holdings to 7,050 hectares on the volcanogenic massive sulphide-rich belt.

With three cutoff grades, the package’s Arrow zone has resources showing:

3% zinc-equivalent cutoff

  • indicated: 2.07 million tonnes averaging 5.92% zinc, 0.75% copper, 21.1 g/t silver and 0.58 g/t gold

  • inferred: 120,550 tonnes averaging 2.6% zinc, 0.56% copper, 18.6 g/t silver and 0.4 g/t gold

5% zinc-equivalent cutoff

  • indicated: 1.76 million tonnes averaging 6.75% zinc, 0.79% copper, 22.3 g/t silver and 0.61 g/t gold

  • inferred: 51,630 tonnes averaging 3.86% zinc, 0.79% copper, 23.9 g/t silver and 0.58 g/t gold

10% zinc-equivalent cutoff

  • indicated: 633,000 tonnes averaging 14.3% zinc, 1.11% copper, 31.7 g/t silver and 0.85 g/t gold
Pistol Bay Mining to take largest position in Ontario’s VMS-rich Confederation Lake

Pistol Bay’s Dixie properties have been
undergoing field work and a review of historic data.

Additionally, the Copperlode A or Fredart zone has an historic, non-43-101 estimate of 425,000 tonnes averaging 1.56% copper. Exploration in the 1970s produced samples up to 1.46% molybdenum.

The 100% option would cost $25,000 and one million shares on closing and $25,000 90 days later, as well as $50,000 and one million shares on each of the four anniversaries following closing. In addition to regulatory approvals, the transaction needs the consent of Glencore plc, whose rights to the Confederation Lake property include a 2% NSR.

The companies expect to close within a week.

“Pistol Bay proposes an ambitious exploration program that will not only pursue existing targets and known VMS deposits, but will use the latest airborne geophysical survey technologies to explore the whole area to a greater depth than was possible in the past,” said president Charles Desjardins.

Earlier this month the company announced MPH Consulting will review historic geophysical data on Pistol Bay’s Confederation Lake-region Dixie properties, where field work began in September. Historic drilling has found zinc, copper and silver, while the recently optioned Dixie 3 project comes with an historic, non-43-101 estimate of 82,500 tonnes averaging 1% copper and 10% zinc.

The company has a joint venture with a Rio Tinto NYSE:RIO subsidiary on the C-5 uranium property in Saskatchewan’s Athabasca Basin. Having already earned 75% of its option, Rio has stated its intention to acquire the full 100%.

Pistol Bay closed a $563,450 private placement last August.

Ottawa resident Larry Mantha recounts how a dog dug up a nugget in his front yard

October 14th, 2016

…Read more

Harold Gibson says Laurentian University’s Metal Earth project intends to transform our understanding of how mineral deposits originated

October 7th, 2016

…Read more