Di­a­mond & Spe­cialty Min­er­als Sum­mary for Jan. 11, 2019

Stockwatch Daily - - MINES & METALS - By Will Pur­cell

THE DI­A­MOND and spe­cialty min­er­als stocks box score on Fri­day was a weak 71-93-150. The TSX Ven­ture Ex­change added four points to 601 while pol­ished di­a­mond prices were flat.

Patrick Power’s Arc­tic Star Ex­plo­ration Corp. (ADD) lost one-half cent to five cents on 1.29 mil­lion shares. The com­pany has been silent for the past month; never a good way to sus­tain a stock pro­mo­tion. When Mr. Power, pres­i­dent and CEO, does have some­thing to say, it is usu­ally about the com­pany’s Ti­mantti di­a­mond project in north­ern Fin­land and when he last men­tioned Ti­mantti, he was mulling the prospect of trench­ing and drilling early this year.

Lukas Lundin and Eira Thomas’s Lu­cara Di­a­mond Corp. (LUC), up five cents to $1.61 on 1.79 mil­lion shares, has re­cov­ered a 127-carat, top-white di­a­mond from its Karowe mine in Botswana. Ms. Thomas, who re­placed Dr. William Lamb as pres­i­dent and chief ex­ec­u­tive of­fi­cer in Fe­bru­ary, says that the di­a­mond “at­tests to the re­mark­able na­ture of the Karowe ore­body,” which, she says, has con­sis­tently de­liv­ered large, high-value di­a­monds through­out its history. She points to the 129 di­a­monds larger than 100 carats that have been re­cov­ered since min­ing be­gan in 2012, 33 last year alone. (The mine has pro­duced 12 di­a­monds larger than 300 carats, in­clud­ing five that were re­cov­ered last year.) While the big rocks are pur­port­edly com­ing faster than ever, they are not as ex­cep­tional as those re­cov­ered in pre­vi­ous years. In Au­gust, when Lu­cara’s earn­ings be­fore in­ter­est, taxes, de­pre­ci­a­tion and amor­ti­za­tion dropped to $36.1-mil­lion (U.S.), Ms. Thomas said that the re­duced in­come in the se­cond quar­ter was the re­sult of “a smaller vol ume and lower av­er­age price of ex­cep­tional stones sold,” as com­pared with a year ear­lier. In the third quar­ter, the com­pany blended its reg­u­lar sales with the ex­cep­tional di­a­monds but once again, its earn­ings de­creased. Ms. Thomas said that Lu­cara’s re-

duced in­come, now down to $18.2-mil­lion (U.S.), was again the re­sult of “a smaller vol­ume and lower av­er­age price of ex­cep­tional goods sold.”

Simon Clarke’s M2 Cobalt Corp. (MC), up five cents to 25 cents on 155,000 shares, is wait­ing for as­says from its 2,027-me­tre, 15-hole drill pro­gram at the Bu­ja­gali cobalt project in Uganda. Drilling be­gan in Oc­to­ber on the Bombo tar­gets at Bu­ja­gali and it wrapped up in mid-De­cem­ber for a win­ter break. Mr. Clarke, pres­i­dent and CEO, says that the first phase of drilling was de­signed to fur­ther test the key tar­gets, and to “po­si­tion the com­pany to em­bark” — start, in other words — on a se­cond, larger phase of drilling. Grab sam­pling in the fall had pro­duced as­says of up to 0.65 per cent cobalt and 0.18 per cent cop­per, so Mr. Clarke and his crew are ea­gerly await­ing the as­says.

Paul Cow­ley’s First Vana­dium Corp. (FVAN), down three cents to 77 cents on 66,000 shares, has re­ceived as­says of up to 0.84 per cent vana­dium ox­ide over 41.15 me­tres at its Car­lin project in Ne­vada. The as­says, from 17 new holes at Car­lin, pro­duced an av­er­age true thick­ness of 33.7 me­tres and an av­er­age grade of 0.54 per cent vana­dium ox­ide. First Vana­dium had re­ceived the re­sults of 11 in­fill drill holes at Car­lin in late Novem­ber, av­er­ag­ing 0.64 per cent vana­dium ox­ide across an av­er­age width of 31.9 me­tres. The as­says from the first six holes, re­ceived in Oc­to­ber, yielded 1.07 per cent vana­dium ox­ide over 41.15 me­tres in one hole and 1.20 per cent over 36.7 me­tres in a se­cond.

Mr. Cow­ley, pres­i­dent and CEO, says that he con­tin­ues to be pleased with the re­sults, which “re­in­force con­ti­nu­ity of a thick, shal­low, near hor­i­zon­tal bed of high-grade vana­dium min­er­al­iza­tion.” As­says from an­other 25 holes are ex­pected next week. Mr. Cow­ley calls those re­main­ing tests ex­ploratory holes, sug­gest­ing that, un­like the con­fir­ma­tion drilling as­says re­ceived so far, First Vana­dium is look­ing to ex­pand its min­er­al­ized zone. First Vana­dium pre­sum­ably hopes to de­velop a com­pli­ant re­source es­ti­mate for Car­lin, which hosts a his­tor­i­cal es­ti­mate of 25.4 tonnes at 0.515 per cent vana­dium ox­ide. Ea­gle-eyed reg­u­la­tors chided the com­pany for its pro­mo­tional ex­u­ber­ance over the holidays, prompt­ing Mr. Cow­ley to re­tract com­ments about “in­fill or ex­pan­sion drilling” — since there is noth­ing com­pli­ant to fill in or ex­pand. He also re­tracted com­ments about First Vana­dium mov­ing to­ward fil­ing an up­dated min­eral re­source, since there is none to up­date. Nev­er­the­less, the new drilling is pre­sum­ably to lead to a maiden re­source es­ti­mate for Car­lin.

Craig Roberts’s Ethos Gold Corp. (ECC), un­changed at 21.5 cents on 1,000 shares, has re­as­sayed sam­ples col­lected from two trenches, dug 1,100 me­tres apart on its Pine Pass vana­dium project in north­east­ern Bri­tish Columbia. At the No. 2 trench, the grade of a 130-me­tre sam­ple in­creased to 0.54 per cent vana­dium ox­ide from 0.48 per cent, while four sam­ples span­ning 90 me­tres at the first trench av­er­aged 0.46 per cent vana­dium ox­ide, up from 0.40 per cent. The lat­est as­says, com­pleted us­ing lithium metab­o­rate fu­sion fol­lowed by acid dis­so­lu­tion, were about 12 per cent higher than the ini­tial as­says, which had been com­pleted us­ing four-acid di­ges­tion. Ethos re­cently sold seven mil­lion flow-through shares at 28 cents, rais­ing nearly $2-mil­lion for ad­di­tional work on the Pine Pass project, one of three vana­dium prospects that the com­pany ac­quired last sum­mer. The two oth­ers are Ur­sula and Tun­nel, but it ap­pears that Pine Pass has be­come the com­pany’s fo­cus. While Mr. Roberts, pres­i­dent and CEO, ap­pears keen to re­sume work on the project, he has not yet laid out a for­mal plan.

Stephen Wal­lace’s Search­light Re­sources Inc. (SRCH), down one cent to three cents on 2,000 shares, has re­ceived as­says of up to 1.35 per cent cobalt from 40 grab sam­ples col­lected at its Cameron project, near Cobalt in North­east­ern On­tario. A se­cond sam­ple re­turned 0.63 per cent cobalt and 0.86 per cent nickel, plus 0.06 per cent cop­per. The sam­ples also yielded over 0.2 per cent bis­muth in some spots, with (very) mod­est amounts of gold.

Mr. Wal­lace, pres­i­dent and CEO, says that he and his crew are en­cour­aged by the as­says, adding that “it is al­ways grat­i­fy­ing” to take a grass­roots project and quickly add value with high-grade re­sults. (The value is prov­ing slow to come: Al­though Search­light did inch up­ward one-half cent on the news Thurs­day, it lost that and more to­day.) Mr. Wal­lace says that he is now look­ing for­ward to fol­low­ing up on the grab sam­pling re­sults “as soon as the snow is gone.” That is still three months away, per­haps more, which will give him enough time to raise cash for the fol­low­ing up he has planned.


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