Dec '06/Jan '07

New Brunswick

Mining’s contribution to New Brunswick

By Les Fyffe, director, New Brunswick Geological Surveys Branch

New Brunswick’s mineral and hydrocarbon resources continue to make a major contribution to the provincial economy.

The value of mineral production from the base-metal mine near Bathurst, the potash mine near Sussex, and various peat and quarry operations across New Brunswick totalled about $875 million in 2005, up from $779 million in 2004. Metals accounted for 65 per cent of New Brunswick’s mineral production in 2005. The next largest contributor was potash, which represented about 15 per cent of the total.

In 2006, the exploration industry is expected to invest about $16 million searching for metallic minerals and $45 million seeking natural gas. This combined investment of $61 million represents a significant increase over the $39 million expended on exploration in 2005.

The number of mineral claims in good standing in New Brunswick reached approximately 20,800 in 2006, up from 19,000 in the previous year. This exploration boom has been driven largely by increases in metal prices: over the last four years, the market value of zinc has quadrupled and that of gold has doubled.

Some 30 junior mining companies are currently exploring in New Brunswick for metals including gold, zinc, lead, copper, indium, tin, tungsten, antimony, and molybdenum.

Xstrata’s recent purchase of Falconbridge Inc., included ownership of the Brunswick mine near Bathurst, northern New Brunswick. Xstrata Zinc and its junior partner, El Nino> Ventures Inc., have entered into a joint exploration program to explore for base metals in the Bathurst Mining Camp. Falconbridge previously identified more than 100 geophysical targets in the camp during the first three years of the continuing five-year (2003– 2008) program.

Xstrata Zinc and El Nino will spend $2.5 million in 2006–2007 conducting further geophysical surveys and drilling programs in the search for deeply buried base-metal deposits in the Bathurst area. Approximately 24,000 metres of diamond drilling comprising 34 diamond drillholes are planned for this period.

Blue Note Metals Inc. is investing $48 million in 2006–2007 to reopen the Caribou and Restigouche mines in the Bathurst Mining Camp. Production is expected to begin in spring 2007 to produce 100 million pounds of zinc annually, and to create 270 direct and indirect jobs in the region. Blue Note Metals reports a mineral resource of 3.81 million tonnes grading 3.26% Pb and 7.50% Zn for the Caribou deposit; and about 1.45 million tonnes grading 5.50% Pb and 7.10% Zn for the Restigouche deposit.

First Narrows Resources Corp. will drill a minimum of 3,000 metres of core beginning in the autumn of 2006.The drill program will focus on the Chester copper-polymetallic deposit. Following recommendations of a recent report on the Chester project by Watts, Griffis and McOuat Limited, the drill program aims to augment the current resource base with new discoveries and extensions of known deposits.

First Narrows Resources has optioned Falls Creek property north of Boiestown in central New Brunswick. Assays on grab samples returned values of up to 0.62% Mo and 0.82% W.

Freewest Resources Canada Inc. has sent a 120-kilogram representative sample of diamond drill core from the Clarence Stream Central Zone to Mintek in South Africa to conduct a bench-scale mineral beneficiation test. Assay results from recent diamond drilling at Clarence Stream included 40.6 g/t Au over 0.3 metres in hole CS06-208 from the proximal West Zone; 34.5 g/t Au over 0.5 metres in hole CS06-212 from the proximal Cox Zone; and 15.2 g/t Au over 5.0 metres in hole AD06-86 from the distal AD-MW Zone.

Freewest and Geodex Minerals Ltd have formed a joint venture to explore the Harry Brook gold belt, 20 kilometres northwest of Sussex in southern New Brunswick. The companies plan a program of till sampling, soil sampling, prospecting, and geophysics across their combined 161 claims in an effort to locate the bedrock source of a goldbearing boulder found during a New Brunswick Department of Natural Resources survey.

Geodex Minerals is conducting major exploration programs for WMo- Sn-In in the Mount Pleasant area of southern New Brunswick and for WMo in the Sisson Brook area of central New Brunswick. Each project will have a budget in the range of $1 million for the 2006 field season. The company has opened a regional office in Fredericton to more effectively manage the programs.

Geodex reported a new ‘in-house’ inferred resource calculation of 25.97 million tonnes of 0.102% WO3 and 0.053% MoS2 on Zone III at Sisson Brook. A 10,000-metre fence-drilling program is being conducted this year to define the resource on 100-metre sections. Hole SB-06-03 drilled through the central part of Zone III intersected 306.6 metres grading 0.06% WO3 and 0.03% MoS2.

Puma Exploration Inc. has completed the first phase of exploration on the Nicholas Denys property in northern New Brunswick. The company drilled four massive- sulphide zones along a mineralized horizon over a strike length of 5.4 kilometres. The best mineralized intersections from each of these zones are as follows: Pine Tree – 90 g/t Ag, 3.8% Zn, 3.8% Pb, and 0.35 g/t Au over 8.0 metres in DDH F05-08; Shaft – 92 g/t Ag, 3.8% Zn, 3.0% Pb, and 0.21 g/t Au over 6.15 metres in DDH F06-05; Hache – 248 g/t Ag, 2.4% Zn, 1.1% Pb, and 1.10 g/t Au over 12.7 metres in DDH F06-01; and Henry – 195 g/t Ag, 1.8% Zn, 2.1% Pb, and 1.00 g/t Au over 3.5 metres in DDH F06-12.

Noront Resources Ltd has filed an independent geotechnical report on the Burnt Hill tungsten property in central New Brunswick with SEDAR.The total historical resource at Burnt Hill is estimated to be 2.82 million tons grading 0.147% WO3. The report recommends undertaking a diamond drilling program to confirm the reported mineralization. The Burnt Hill property is currently under option to Limerick Mines Ltd.

SLAM Exploration Ltd completed a 16-hole drilling program on its Nash Creek lead-zinc-silver deposit in northern New Brunswick.This drilling program was designed to test deeper airborne MEGATEM and VTEM anomalies and to further define the current resource base at Nash Creek. Hole NC06-16 returned 6.5% Zn in a significant step-out 229 metres northeast of discovery hole NC05-05. Drillhole NC06-31 tested a deep target 2.2 kilometres east of the Nash Creek deposit and intersected altered but unmineralized volcanic rocks. Shallow holes NC06-17 to 25 were put down northeast of the deposit to test for potential extensions. Hole NC06-17 returned base-metal intercepts of 6.2% Zn, 1.1% Pb, and 24.1 g/t Ag over 3.3 metres; and holes NC06-19, 21, 22, and 24 intersected sulphide-bearing intervals ranging from 1% to 4% Zn. Holes NC06-26 to 30 were drilled near the known deposit; hole NC06-29 returned 5.0% Zn, 0.7% Pb, and 44.6 g/t Ag over 14 metres.

Stratabound Minerals Corp. drilled 17 holes on its Elmtree gold property near Bathurst in northern New Brunswick.The drilling program found three new zones of gold and base-metal mineralization.Hole 2 encountered grades of 1.98 g/t Au, 43.1 g/t Ag,1.83% Zn,2.29% Pb, and 1.34% Sb over its full 9.1 metres length.Hole 5 intersected a 5.4 metres zone averaging 2.62 g/t Au, 93.5 g/t Ag, 4.27% Zn, and 1.06% Pb including a 0.5 metres ‘bonanza-grade’interval of 5.29 g/t Au, 461.0 g/t Ag, 6.31% Pb, and 21.7% Zn, with 3.8 metres of 25.3 g/t In.Hole 8 intersected 4.3 metres of gold mineralization grading 1.02 g/t Au. The intersection includes 1.0 metres with 2.54 g/t Au, 106.7 g/t Ag, 6.86% Zn, 3.60% Pb, 1.11% Sb, and 0.7 metres of 22.9 g/t In.

Mantra Mining Inc. has signed an option agreement with Geodex Minerals Ltd to earn a 75 per cent share. Global can also earn up to a 65 per cent interest in the project by the second year of activity. A major drilling program is planned this year to investigate drill targets defined by Geodex.

After completing a VTEM survey and drilling program on their St. Stephen Ni-Cu-Co property in 2005, Abitex Resources Inc. has conducted metallurgical testing (bacterial) on the nickel ores this year. Results are yet to be published.

Adex Mining Inc. commissioned a technical review of their Mount Pleasant W-Mo-Sn polymetallic property this year by Watts, Griffis and McOuat Limited (WGS). The extensive report summarizes work conducted to date on the property by WGS to verify previous resource evaluations. It also reviews mineral processing and metallurgical work and summarizes previous resource estimates.

Invenio Minerals Inc. has conducted a resampling program on the titanium deposit at Lower Coverdale in southeastern New Brunswick for metallurgical work.

Exploration expenditures in New Brunswickare expected to further increase in 2007.

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