Diamond & Specialty Minerals Summary for Jan. 11, 2019
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.