Exploration and mining heat up in Nunavut
By Karen D. Costello and Linda J. Ham, district geologists, Iqaluit, Nunavut, Indian and Northern Affairs Canada
During 2006, an estimated $200 million was spent by the exploration and
mining sector in Nunavut. Based on Natural Resources Canada’s (NRCan) biannual
survey, $225 million is forecast for 2007. The overall number of hectares
covered by some form of mineral tenure declined from 48.6 million hectares in
2005 to 27 million hectares in 2007, as explorers turned to more focused and
higher cost field programs.
The number of exploration properties under evaluation in the territory’s
three districts — Kitikmeot, Kivalliq and Qikiqtani — has increased over last
year. The largest increase is with grassroots projects targeting uranium; most
companies are exploring for unconformity-associated mineralization associated
with Proterozoic basins. There are over 135 properties undergoing varying levels
of exploration: nine base metals, 41 diamonds, 25 gold and precious metals, two
iron, six nickel-copper-platinum group elements (PGE’s), 49 uranium, one coal
and one sapphire.
As major mining companies strive to replenish reserves, Nunavut projects
operated by juniors are attracting attention. This year, three juniors with
advancing exploration projects were courted by international major mining
companies. Majors continue to forge technical alliances with and
make strategic investments in juniors with significant exploration
portfolios in Nunavut.
There are several advanced-stage exploration properties in
addition to Nunavut’s first mine, the Jericho Diamond Mine. At the
Jericho Mine, which opened in 2006, Tahera Diamond Corporation
has increased production grade to 0.90 carats per tonne and the
value of production for the second quarter of 2007 was $6.9 million.
However, financial losses were incurred, leading the company to
adopt a comprehensive financing and improvement plan on which
progress is being made. Tahera, De Beers Canada Inc. and Nordic
Diamonds Inc. sampled 500 tonnes of the JD-3 kimberlite on the
Jericho claims and conducted drilling and ground geophysics on the
Anuri kimberlite property.
Stornoway Diamond Corporation added to their land holdings with their
takeover of Ashton Mining of Canada Inc.and Contact Diamond Corporation.The
Artemisia diamond property optioned to Vaaldiam Resources Ltd. and Ashton
was returned to Stornoway.
Diamondex Resources Ltd. acquired Trigon Exploration Canada Limited and
continued work on numerous diamond properties in the Coronation Gulf region
and in eastern Kitikmeot.
The Kugaaruk area on the Boothia Peninsula, a potentially significant
diamond district discovered in 2006, continues to return encouraging results.
Indicator Minerals Inc., Hunter Exploration Group and Teck Cominco Limited
discovered four more kimberlites on the Darby project, bringing the total to
nine. Indicator and Hunter are also evaluating their Barrow project. Diamonds
North Resources Ltd. explored independently and in joint ventures with several
companies (Shear Minerals Ltd., International Samuel Exploration Corp. and
Arctic Star Diamond Corp.). On their wholly-owned Amaruk project, Diamonds
North discovered 17 new kimberlites,for an updated total of 22.Diamonds North
and sister company Uranium North Resources Corporation, continued exploring
for diamonds and uranium on trans-border properties
between the NWT and Nunavut on both Victoria Island
and in the western Kitikmeot.
Newmont Mining Corporation made an all-cash
offer for Miramar Mining Corporation, whose prime
assets are extensive land holdings in the Hope Bay
greenstone belt. Miramar is in the process of acquiring
all of the necessary authorizations for the Doris North
open pit gold mine, scheduled to start in 2008. Active
exploration is underway throughout the belt, with at
least two more gold-bearing systems identified for
future development. As of April 2007, the updated gold
resource estimates, for the entire belt, point to an
indicated total of 5.2 million ounces at 4.54% grams per
tonne and inferred resources of 5.4 million ounces of
gold at 3.6 grams per tonne. Drilling in 2007 suggests
further increases in these resource estimates.
The Back River Project (George Lake/Goose Lake;
Dundee Precious Metals) is a banded iron formation,
advanced gold property. Updated resource estimates
(based on over 1,000 drill holes) point to indicated
resources of 3.41 million tonnes at 10.9 grams per tonne Au and inferred
resources of 3.55 million tonnes at 10.2 grams per tonne Au. Plans for 2007
included delineation drilling, soil and rock sampling, geochemistry and bulk
density determinations for resource modelling.
Committee Bay Resources continued their gold exploration efforts along the
Committee Bay greenstone belt in eastern Kitikmeot and northern Kivalliq. The
best prospects include Three Bluffs, Raven, Antler, Anuri, West Plains and Inuk.
Drilling in 2007 was designed to increase the Three Bluffs’ inferred resource of
1.897 million tonnes at 8.0 grams per tonne Au.
Zinifex Limited, an Australian zinc-lead miner, completed a take-over of
Wolfden Resources and their advancing projects within the High Lake
greenstone belt (western Kitikmeot). These projects include the volcanogenichosted
massive sulphide deposits of Izok, High Lake and Hood, as well as the Ulu
gold deposit and Gondor base metals project (60 per cent owned with Xstrata
plc). Izok has indicated resources of 14.8 million tonnes grading 2.5% Cu, 12.8%
Zn, 1.28% Pb and 71 grams per tonne Ag, plus inferred resources of 0.37 million
tonnes grading 3.79% Cu, 6.40% Zn, 0.27% Pb and 54.2 grams per tonne Ag.
Wolfden submitted a draft Environmental Impact Statement in November
2006 for the High Lake copper-zinc open pit and
underground operation. Regulatory review is ongoing
and a final development decision is expected in 2008.
Indicated reserves are 17.3 million tonnes of 2.25% Cu,
0.32% Pb, 3.35% Zn, 0.95% grams per tonne Au and
69.75 grams per tonne Ag; inferred reserves are 1.3
million tonnes of 1.17% Cu, 0.28% Pb, 3.36% Zn, 0.78
grams per tonne Au and 64.6 grams per tonne Ag.Zinifex
also acquired Lupin, a folded, banded iron formation
former gold mine east of Izok.
Sabina Silver Corporation’s 2007 highlights at its
Hackett River silver-zinc-gold-copper-lead project
included a Preliminary Economic Assessment by
Wardrop Engineering Inc.This study suggests a 13.6 year
mine life, with an average annual production of 324.7
million pounds Zn, 12.4 million ounces Ag, 20.7 million
pounds Cu, 37 million pounds Pb and 17,200 ounces Au.
North Arrow Minerals, a new company to Nunavut,
optioned Strongbow Exploration Inc.’s properties (gold,
base metals and the precious metals Silvertip project) in
western Kitikmeot and undertook grassroots exploration
activities. Kaminak Gold Corporation has
optioned its Kitikmeot properties to various
The Muskox Intrusion, a layered maficultramafic
complex with nickel-copperplatinum
group elements (PGEs) mineralization,
is being explored by Adriana Resources Inc. and
50/50 Nunavut Ltd. A new zone of mineralization was identified near the Keel
portion of the intrusion. Silvermet Inc. and Prize Mining Corporation conducted
work on their claims in the south-central portion of the complex.
The Hornby Bay Basin of western Kitikmeot has attracted several
companies searching for uranium. Exploration efforts by UNOR Inc. (owned
19.5 per cent by Cameco Corporation) have identified uranium targets within
their extensive land holdings, some of which are governed by agreements
with Cameco and Adriana. Triex Minerals Corporation and Pitchstone
Exploration Ltd. continued delineation drilling and evaluation of the Mountain
Lake deposit and nearby targets.
The gold,diamond and nickel exploration projects in the Kivalliq were joined
in 2007 by a new generation of uranium explorers. Of the 51 properties in the
region, 27 are under evaluation for their uranium potential, with two more
having uranium-base metal associations. The majority of the uranium
exploration interest is directed towards the Thelon Basin and its underlying
Shear Minerals Ltd. and partner Stornoway Diamond Corporation had
another successful year in evaluating the diamond potential of the Churchill
Property. The 2007 work focused on continued exploration of promising
indicator mineral trains and geophysical anomalies. As well, evaluation
continued on four diamond-bearing, vertically-emplaced kimberlite dykes
(Jigsaw, Notch, Kahuna and Meeka) that returned sample grades up to 2.18
carats per tonne. Initial results from the bulk sampling program at Kahuna
yielded an average diamond content of 0.90 carats per tonne. Drill-testing along
the Kahuna trend suggests a kimberlite body along a 4.5 kilometre strikelength.
Thirty-one new kimberlite occurrences were discovered in 2007, 15 in
drill core and 16 from surface occurrences. Three of the kimberlites are
interpreted to be similar to diamond-bearing ones found elsewhere on the
property in 2006.
Peregrine Diamonds Ltd.was active on its Nanuq Diamond Project,northeast
of Baker Lake, conducting ground-based geophysical surveys and follow-up
drilling. Peregrine has entered into a letter of agreement with Indicator and
Hunter for exploration on the Nanuq North property,where there are 67 claims
covering 46,955 hectares.
Agnico-Eagle Mines Ltd. started off 2007 by putting in an offer to acquire all
shares of Cumberland Resources Ltd., the 100 per cent owner of the Meadowbank
gold project.The transaction was completed in July 2007.The Meadowbank project
has gold reserves of 21.3 million tonnes grading 4.2 grams per tonne.Agnico-Eagle
committed $8 million to the 2007 field program,exploring for potential extensions
and new zones of mineral resources at the Goose South (discovered 2007) and
Cannu zones (discovered 2005). Drilling was used to test the mineral resource
envelopes in, or near, the open pit reserves at the Portage and Goose Island zones.
Results suggest continuous gold mineralization over 3.5 kilometres and these
results could potentially lead to increases in the resources and reserves.
Comaplex Minerals Corporation has received regulatory approval for an
underground exploration decline into the Tiriganiaq gold deposit on its
Meliadine West Project (78 per cent Comaplex; 22 per cent Resource Capital
Fund). The proposed 11-month underground program has been designed so
that, if evaluation work (bulk sample and a feasibility study) is positive, the
decline could be used for production purposes. An infill-drill program, designed
to upgrade the resource status, increase the understanding of the deeper parts
of the deposit and test portions of the potential open pit on the Tiriganiaq
In southern Kivalliq, Newmont Canada
Exploration has a gold exploration project west of
Nueltin Lake, to look for Proterozoic sediment-hosted
gold. Maze Lake is another early-stage gold
exploration project, targeting Archean greenstonestyle
gold mineralization,operated by Terrane Metals
Corporation and optioned from Placer Dome.
The Ferguson Lake Project, operated by Starfield Resources Inc., is the most
advanced nickel-cobalt-copper-PGE project in Nunavut. In 2007, a revised
mineral resource estimate for the Main West Zone was released and indicated
15.2 million tonnes grading 0.71% Ni, 1.04% Cu, 0.08% Co,1.64 grams per tonne
Pt and 0.28 grams per tonne Pd. This represents a 76 per cent increase over a
previous estimate. Delineation drilling of the low sulphide-PGE zone, 50 metres
below the massive sulphide lenses of the Main West Zone,was the focus of the
2007 drill program. A scoping study is underway to meet the requirements of a
Preliminary Economic Assessment, under NI 43-101 guidelines.
Intrepid Mines Ltd. and Aura Silver Resources Inc. are exploring the
Greyhound property within the Archean Woodburn Lake greenstone belt, 50
kilometres north of Baker Lake. The property hosts sulphide-enriched boulders
containing base and precious metals, suggestive of volcanogenic massive
Drill-testing of zinc, copper, gold and uranium targets was conducted by Tri
Origin Exploration Ltd. on the Keewatin Project.
There are 14 companies actively involved in uranium exploration in the Kivalliq.
The most advanced properties are Kiggavik and Sissons, collectively referred
to as the Kiggavik Project. Past work identified three deposits with significant
uranium resources: Kiggavik, Andrew and End. In late 2006, Areva Resources
Canada Inc. commenced a viability study that included geotechnical drilling,
environmental studies and near-deposit exploration work. Extensive work is
planned for 2008.
Cameco Corporation is exploring for uranium on four properties, three in the
Thelon Basin area and one west of Nueltin Lake in southern Kivalliq.
In 2007, Titan Uranium Inc. completed its second season of drilling on its
Thelon North properties and acquired 61 new claims, covering areas with
favourable geology and several radiometric anomalies. During 2007, Titan
entered into an arrangement with Mega Uranium Ltd. whereby Mega can
acquire a 51 per cent interest in all of Titan’s interests in the Thelon Basin.
Western Uranium Corporation’s Ruby Hill Project occurs along the north and
north-east perimeter of the Thelon Basin. Ground geophysics, surface sampling
and prospecting and drill testing of conductors identified from the 2006
airborne surveys were conducted in 2007. Cameco will acquire a ten per cent
equity interest in WUC through a non-brokered private placement to form a
A neighbouring project along the Thelon Basin’s north margin is the Garry
Lake property, owned and operated by Uravan Minerals Inc. Results of two new
geophysical surveys will be integrated with an area-wide geochemical
compilation to identify coincident anomalies and potential drill targets for 2008.
Bayswater Uranium Corporation began field work on its five wholly-owned
claim blocks and ten prospecting permits (50 per cent-owned through the
Canadian Uranium Joint Venture with Strongbow). Results from their 2006
airborne magnetic survey suggest kimberlite potential exists on the Itza Lake
claim block, now under option to Stornoway.
The North Thelon Joint Venture (NTJV), operated 50/50 by Forum Uranium
Corporation and Superior Diamonds Inc., covers a portion of the eastern margin
of the Thelon Basin and an option on a property northeast of the Kiggavik area
from Tanqueray Resources Ltd.
Uranium North is actively exploring for uranium on two project areas: Amer
Lake and South Baker. Airborne geophysics and extensive sampling on
numerous prospects was completed, with additional work planned for 2008.
The Baker Uranium Project is Pacific Ridge Exploration Ltd.’s flagship
property, optioned from Kaminak Gold Corporation. Pacific Ridge has identified
a number of priority drill targets, including Lucky-7, KZ Zone and 7-One. New
drilling intersected uranium mineralization at Lucky-7 Zone, associated with
fracturing and clay alteration of the Kazan sandstone within a northerlytrending
sub-vertical structural corridor emplaced with a mafic dyke. Drilltesting
below the 2006 holes encountered thicker and higher grade uranium
intersections at depth.
Outside of the Thelon Basin, Ur Energy Inc. (Bugs Property) and Kaminak
(Yathkyed Iron Oxide Copper Gold +/- Uranium Property) have early-stage
uranium exploration projects underway.
The Mary River Iron project of Baffinland Iron Mines Corporation
dominates the Qikiqtani development scene. For 2007, a $90 million program
was announced, with exploration, bulk sampling and other activities in
support of a Definitive Feasibility Study and a Scoping Study underway.
Detailed engineering and economic investigations continue. Exploration
drilling between Deposit 3 and 3A shows continuity, with varying widths.
Exploration and geomechanical drilling were completed on Deposit No. 1 and
Deposit No. 3. Geotechnical drilling focused on proposed port sites,
overburden testing at the Mary River project site and drilling on the Mary
River to Steensby Inlet rail corridor. Baffinland is planning a bulk sample of
250,000 tonnes of high-grade hematite and magnetite ore to be delivered to
several steel mills for late 2008.
Advanced Explorations Inc. and Roche Bay plc entered into a joint venture
agreement to undertake work required to complete a feasibility study on the
Roche Bay banded iron formation (magnetite) deposits.
The Aviat project on the Melville Peninsula was Stornoway’s largest project,
in partnership with BHP Billiton and Hunter. The 2007 summer exploration
program helped to delineate and extend a series of stacked, flat-lying kimberlite
sheets, up to approximately 7 metres thick, and resulted in the discovery of a
new pipe (AV 9). Increased understanding of the sheet complex has enhanced
Aviat’s tonnage potential. All kimberlites have proven to be diamondiferous,
with the new AV 9 pipe currently undergoing analysis for diamond content.
The 1.04 million acre Qilalugaq Project is covered by an option agreement
between Stornoway and BHP Billiton.Stornoway discovered four new kimberlite
dykes (Naujaat 3 to 6) and extended the strike-length of the Naujaat 1 and 2
dykes discovered in 2006. Samples for macro-diamond analysis were collected
and 600 kilograms from the Naujaat 1-6 bodies was submitted for caustic fusion
analysis. Sixteen kimberlites are now known within a 26 kilometre trend,
interpreted to be a structural corridor exploited by kimberlite magmas rising
from the mantle.
Peregrine Diamonds Ltd. operates three diamond exploration project areas,
Chidliak, Mirage Bay and Foxe Basin, covered by two agreements between
Peregrine and BHP Billiton. Follow-up heavy mineral sampling was conducted
on the Mirage Bay and Chidliak projects to better define the indicator mineral
trains and constrain an up-ice indicator cut-off. On the Foxe Basin project, 14
aeromagnetic anomalies, identified on Prince Charles Island,were followed-up
with detailed ground-based magnetic surveys. Heavy mineral samples were
collected from Prince Charles and other islands within the project area.
Diamond exploration is underway in the High Arctic by De Beers, in
partnership with Pure Diamonds Exploration Inc. Processing of the 2006 till
samples was completed, resulting in the identification of two kimberlite
indicator mineral areas on Cornwallis Island and in the western portion of Devon
Island (Cape Osborne). A detailed program of airborne magnetic surveying and
follow-up till sampling was undertaken on the Cornwallis Island permit block.
De Beers continued work on the Baffin Island Diamond Project by drilltesting
several geophysical targets and evaluating the Aliguja and Amon
kimberlite trend. The next phase of exploration will focus on evaluating existing
discoveries and related targets along kimberlite boulder trains within the
Diamondex conducted ground geophysics, till and stream sediment
sampling, and diamond drilling on the Brodeur Property. Focused drill-testing of
the Tuwawi kimberlite was undertaken and 9 of 14 holes drilled over the Nanuk
and Kuuriaq target area intersected kimberlite.
Work on the Baffin Island Gold Project, operated by Commander Resources
Inc., continues to reveal the gold endowment of the Lower Proterozoic iron
formations and shear zones along the 140 kilometre greenstone belt. With the
discovery of the Hebert mineralized trend (a 14 square kilometre area with
swarms of quartz veins carrying arsenopyrite, pyrrhotite and minor galena), 17
gold prospects have now been identified.
On Baffin Island, Cameco acquired 27 prospecting permits around the
Proterozoic Borden and Fury-Helca basins. These basins are similar in age to the
other uranium-bearing sedimentary basins in Nunavut and also similar in
characteristics to the uranium-bearing Athabasca basin and basins in Australia.
They have received limited attention for their uranium potential and are
currently being explored by Cameco and UNOR.
Recent initiatives undertaken by various stakeholders and by government
in Nunavut, such as exploring options of online map selection, the release of
Nunavut Tunngavik Incorporated’s (NTI) uranium exploration policy and the
further development of nunavutgeoscience.ca (a web-based portal linking
users to publicly available Nunavut geoscience information), will allow
Nunavut to remain competitive with other jurisdictions in Canada.
All exploration companies operating in Nunavut are encouraged to ensure
they gain a good understanding of the operating and regulatory requirements,
and acquire all applicable authorizations and permits prior to proceeding. A
good resource is INAC’s Exploration and Mining on Crown Lands in Nunavut
Guidebook available online at http://www.aincinac.gc.ca/nu/nuv/mng_e.html.
Historic exploration efforts and government geoscience mapping projects
have identified prospective geological terrains within Nunavut.Armed with new
ideas, modern technologies, improved understandings of the geological
environment and revised exploration models, companies are venturing into
under-explored areas and making gains. New discoveries are occurring in the
territory, confirming the high mineral potential and likely emergence of core
mining districts within Nunavut.