by Will Purcell
The diamond and specialty minerals stocks box score on Tuesday was a mediocre 69-91-144. The TSX Venture Exchange lost four points to 598 while polished diamond prices were flat. Dermot Desmond's Mountain Province Diamonds Inc. (MPVD), which fell to $1.54 in early December but had clawed its way back to $2 by the end of 2018, has turned bearish again. It dropped six cents to $1.69 on 34,000 shares today. The company was silent about its December sale of rough from the Gahcho Kue mine in the Northwest Territories.
Bruce Counts's Lithoquest Diamonds Ltd. (LDI) gained one-half cent to 11 cents on 10,000 shares, a better day than Monday, when it lost 11 cents to 10.5 cents on 1.5 million shares. The slump followed "microdiamond results" from a kimberlite sample from the 1804 pipe at the company's North Kimberley project, near the northern coast of Western Australia. Unfortunately, the laboratory technicians at the Saskatchewan Research Council facility in Saskatoon did not need their counting and logging skills: There were no diamonds found in the 124 kilograms of material submitted for caustic fusion -- hence Monday's sell-off.
Mr. Counts, the company's founder and its president and chief executive officer, nevertheless is determined to soldier on. He points out that a kimberlite field with economic kimberlites often includes barren bodies, adding that Lithoquest has strong evidence that diamond-bearing kimberlites are present over a wide area of the company's project. While he concedes that 1804 does not warrant further work at this time -- often a promoter's way of saying "never again" -- he quickly points to several high-priority target areas that Lithoquest will pursue later this year. As well, the company is "actively developing additional zones of interest" that would presumably become the 2020 focus, if the current crop of priority targets fails to excite.
Lithoquest has yet to reveal a formal plan for this year, but Mr. Counts says that there are nine high-priority areas slated for work this year. The new areas produced kimberlite indicator minerals in rock, stream and soil sampling, with grains from "several" of the target areas demonstrating high-interest mineral chemistry. (To a Howe Streeter staring down bad news, every surviving target becomes a high priority.) In any case, Lithoquest is tentatively planning prospecting, sampling geophysics and drilling -- it just does not say how much, or where.
While it is unclear what strong evidence Mr. Counts has that North Kimberley is widely diamondiferous, history suggests that the area is diamond country. The company's stock leapt as high as 88 cents early last April, after Mr. Counts revealed that the company had recovered three microdiamonds from a 10-kilogram batch of rock taken from the 0702 target. In August, the stock gave back its gains, and more, after Mr. Counts said that Lithoquest's drilling at 0702 failed to hit kimberlite.
The Seppelt-2 kimberlite lies as a small enclave surrounded by Lithoquest's property. Although the body is too small to be of economic interest, it apparently tested at 2.25 carats per tonne. Further, stream sampling years ago turned up a 1.73-carat diamond that had been valued at nearly $1,300 (U.S.). Beyond those local bits of encouragement lie the massive Argyle mine and the old Ellendale mine. Both are several hundred kilometres distant, but both are inevitably called upon by promoters touting Australian diamond projects.
Argyle, 300 kilometres to the southeast, has been a producer for decades for Rio Tinto PLC. The mine yields mostly industrial stones, although at a rate of six carats per tonne for many years, but it is the smattering of pink fancies that keep it going. Ellendale, 450 kilometres southeast of Kimberley North, had a shorter run, but it was economic for several years thanks to a steady stream of fancy yellow diamonds.
Gary Economo's Stria Lithium Inc. (SRA), unchanged at four cents on 5,000 shares, has sold some more shares in a second tranche of what now looks to be a three-tranche placement. The company sold three million flow-through shares at five cents in mid-December to two unnamed insiders. (They subsequently were revealed as Lindsay Weatherdon, a director, and Jeffrey York, chairman and a significant shareholder.) The company has now sold seven million additional flow-through shares at five cents, including 3.5 million to another unnamed insider whose identity will remain secret until he files the required insider trading report in a few days.
Mr. Economo, president and CEO, says that the company has an additional month to sell the rest of the stock. Stria is offering another 10 million flow-through shares at five cents, which would bring the full placement to $1-million. The new cash is presumably for work on the company's Pontax lithium project in the James Bay district of Quebec. The company has been intermittently working the project since it acquired it nearly six years ago. Last spring, Stria completed its first drill program at Pontax, receiving assays of up to 1.16 per cent lithium oxide over 21.39 metres in one of seven holes. A second hole produced 0.82 per cent lithium oxide over 11.17 metres.
Lee Barker's Sparton Resources Inc. (SRI), up one-half cent to six cents on 39,000 shares, is touting the final commissioning of the first phase of a 40-megawatt-hour vanadium-redox battery by VRB Energy Inc. Mr. Barker, Sparton's president and CEO, points out that his company has a "significant indirect interest" in VRB. (Once one traces the interests held by various subsidiaries in other subsidiaries across the Caribbean, Sparton holds a 16.16-per-cent interest in China-based VRB Energy System, which owns the battery.)
Dr. Tony Harwood's Montero Mining and Exploration Ltd. (MON: $0.08) has a maiden resource estimate for its Uis tailings project in Namibia. The calculation lists an inferred resource of 14.4 million tonnes of coarse material averaging 0.37 per cent lithium oxide and 0.05 per cent tin. There are another 2.71 million tonnes of fine material averaging 0.06 per cent tin.
Dr. Harwood, president and CEO, says that further drilling and metallurgical work will be needed to upgrade the inferred resource to an indicated classification. As well, he says that Montero will be evaluating early production scenarios in tandem with the resource upgrade to meet expected lithium and tin demand. The tailings were left behind when the old Soris mine, which began small-scale intermittent production in 1960, closed for good in 1990.