by Will Purcell
The diamond and specialty minerals stocks box score for Friday was a positive 66-56-141. The TSX Venture Exchange gained one point to 800 while polished diamond prices edged lower. Dominion Diamond Corp. (DDC) continued its rally today, adding another 12 cents to $12.75 on 1.27 million shares. The company has been helping its own cause this fall by buying back its stock. It intends to buy up to 6.1 million shares through the normal-course issuer bid.
Ken MacNeill and George Read's Shore Gold Inc. (SGF), which lost one-half cent to 19.5 cents on 567,000 shares, has been stuck in a 20-cent funk for the past four years. Nevertheless, there are proposed changes to the company's mining plan for its Star-Orion South diamond project in central Saskatchewan that could generate new interest in the company's flagging promotion. One of the more intriguing and more complex of Shore's plans involves changes to its proposed processing facility.
Early this year, Mr. Read, the company's senior vice-president, began mentioning plans to redesign the processing plant based on X-ray technology (XRT). Details were sparse, even in the company's June presentation to shareholders, where the company said little more than XRT equipment has been proven for the recovery of large diamonds without breakage, and as a result the company planned to run tests of the method. The test was a small one, conducted this summer by Steinert GmbH in Germany, using just 2.8 tonnes of Star kimberlite that had been crushed through autogenous milling. Mr. Read declared it a success, as all the natural diamonds spiked into batches of rock between eight and 32 millimetres in diameter were recovered. As a result, he says that XRT is viable as a replacement for dense media separation of kimberlite fragments larger than eight millimetres in the company's proposed plant.
It is not a farfetched scheme, as XRT is successfully used in other diamond mines. Perhaps the best example is Karowe, where Lucara Diamond Corp. (LUC: $3.91) has been recovering huge diamonds for the past few years, each time lauding its XRT equipment as a key factor. Lucara has been using the XRT devices in its large and huge diamond recovery circuits, for material up to 65 millimetres in diameter, and it is apparently adding a mammoth diamond recovery circuit in case larger gems are present. Further, Lucara is adding four more XRT devices to its plant, to handle small bits of kimberlite (for it) between four and eight millimetres in diameter, a $30-million (U.S.) upgrade that brings its XRT count to 10.
Shore therefore faces an engineering challenge given the sheer scale of its proposed mine. The company expects to process 45,000 tonnes of kimberlite per day, roughly seven times what Karowe handles. According to Steinert's spiffy brochure, its XRT equipment can handle about 4,300 tonnes per day, roughly the same as the equipment used at Karowe. Presumably Shore will use the same milling strategy as do Karowe and similar mines, and there is clearly no doubt that Star and Orion South contain some huge diamonds. If so, Shore will need a series of circuits to handle several ranges of kimberlite fragments. If so, the manufacturers of the XRT equipment had best brace for a huge order, assuming Mr. Read can cut the capital cost enough to attract the required financing.
Jamie Tuer's Hudson Resources Inc. (HUD), down four cents to 34 cents on 23,000 shares, has received an independent study that shows the anorthosite mined at its White Mountain project in Greenland will make a good mineral additive for the paint, coatings and polymer industries. Mr. Tuer, president, says the study supports his plan to have "several robust revenue streams" from White Mountain. The company is currently building a mine at White Mountain to handle one of those streams, the supply of anorthosite to E-Glass fibreglass manufacturers starting in about a year.
Hudson will apparently divert some of that stream to its additive project, which will require the company to grind the anorthosite into a finer product. The study is based on Hudson supplying 40,000 tonnes of product annually within three years and Mr. Tuer says Hudson "will now move aggressively" to introduce the material to potential end-users, with the objective of signing off-take agreements. (The company already has one off-take deal for the fibreglass-grade anorthosite, but the shift toward the additives sector suggests his talks with other fibreglass customers have been lagging.)
Boris Kamstra's Alphamin Resources Corp. (AFM), up two cents to 27.5 cents on 5,000 shares, says that a misunderstanding with the government of the Democratic Republic of the Congo (DRC) has been cleared up. The DRC detained Richard Robinson, the managing director of Alphamin's subsidiary, and requested that he meet with the special mining sector fraud division in Kinshasa to answer questions about the export of samples from the Bisie tin project. (Alphamin has sent enough drill core and other samples abroad to allow it to declare a reserve of 3.52 million tonnes averaging 4.34 per cent tin and complete a now three-month-old feasibility study.)
Mr. Kamstra, CEO, says that Mr. Robinson had an "exchange of information" with the bureaucrats that "clarified a misunderstanding" and got the government to agree (again) to a crackdown on illegal mining on parts of its Bisie project. Mr. Kamstra points out that Mr. Robinson, who spent nearly two weeks as the government's special guest in Kinshasa, was able to "work and circulate freely" while waiting for the bureaucrats to deal with the matter. (Circulating freely is not a recommended activity in Kinshasa, according to the United States Department of State, but he likely found it far more pleasant to stroll about there than at home in the untamed wilds of North Kivu.
Don Bubar's Avalon Advanced Materials Inc. (AVL), down one-half cent to 20.5 cents on 72,000 shares, has a preliminary economic assessment of its Separation Rapids lithium project in Northwestern Ontario. The dream sheet credits the project with a discounted net present value of $228-million after taxes, for a 2,700-tonne-per-day mine that would cost $514-million. Avalon began looking at Separation Rapids nearly 20 years ago as a source of lithium for the ceramics industry. It is now touting the project as a source of lithium for electric car batteries. The mineral resource estimate has changed little over the years. Separation Rapids now hosts eight million tonnes measured and indicated at 1.29 per cent lithium oxide with 1.63 million inferred at 1.42 per cent.