Resource World Magazine

20 www.resourceworld.com D E C E M B E R / J A N U A R Y 2 0 1 7 Insights & Investments by Barry Muir D iamond mining in Canada has come a long way since the mid- 1980s when Chuck Fipke and Stewart Blusson made the country's first diamond discovery at Point Lake, Northwest Territories. Although that discovery proved to be uneconomical, it resulted in the larg- est diamond staking rush in the history of mining. In 1991, Fipke and Blusson (Dia Met Minerals) found evidence of diamond- bearing kimberlite pipes about 320 km north of Yellowknife at Lac de Gras. BHP Billiton developed one of the pipes into the Ekati Diamond Mine, now 88.9%-owned by Dominion Diamond, that produced Canada's first commercial diamonds in 1998 and has since produced over 40 million carats. Canada's second diamond mine at Diavik (Rio Tinto/Dominion Diamond) began pro- duction in 2003, helping to place Canada third in the ranking of the world's largest diamond producers. Diavik has a projected 20-year life and is expected to peak at 11 million carats per year, representing about 6% of the world's total supply. The Gahcho Kue Mine (De Beers/ Mountain Province), located 280 km northeast of Yellowknife, is Canada's sixth diamond mine and began production last September with full capacity expected in the first quarter 2017. The billion dollar project is expected to produce 4.5 million carats, or 900 kilograms of diamonds a year. The Canadian diamond mining industry has already brought billions of dollars in commerce to the economy of the Canadian North. It employs about 2,650 people in mine operations and another 1,500 in support industries, such as maintenance, catering and transport. Aboriginal persons make up 30 to 40% of the mining work force. Canadian diamonds appeal to people who are concerned about environmen- tal and human rights issues. They are produced from mines that have some of the world's highest environmental stan- dards with proceeds of the mines going to legitimate companies instead of groups who have obtained the diamonds through forced labor, theft or other exploitation. As such, diamond exploration continues in the Canadian Arctic. A geologically unique property, Dunnedin Ventures Inc. [DVI-TSXV] is exploring its 100%-owned Kahuna Project that features both diamonds and gold. The project is only 42 km from Rankin Inlet (pop. 3,000) on Hudson Bay, a centre of government and industry and less than 10 km from Agnico Eagle's Meliadine gold project (now under devel- opment). Discovered in 2001, Kahuna is an advanced-stage property with over $30 million in historical expenditures. The 60,000-hectare Kahuna property hosts over 100 kimberlite bodies and dikes that form a kimberlite-intruded structural network stretching over 180 km. Dunnedin has also confirmed the presence of signifi- cant amounts of gold in till at Kahuna with interpreted source areas having similar geology to Agnico's nearby Meliadine gold project. Drill programs are planned to test both gold and diamond targets. What makes the Dunnedin Ventures story especially interesting to me is the talent on board. Dr. Chuck Fipke is a technical advisor as well as Chad Ulansky, PGeo, an experienced diamond explorer and a director. The company completed a glacial till sampling program last summer that com- prised 118 samples. This was the same detailed work that Fipke and Blusson had done that eventually led them to the Ekati discovery. Samples were closely examined for kimberlite indicator minerals (KIMs) that eroded from kimberlite bodies, were transported by glaciers and deposited down-ice, creating a train of favourable till samples traced back to their original source. Dunnedin's test program utilized the same Ekati-style sampling and mineral ranking techniques that resulted in the company identifying 29 new target areas, of which 10 were tested with new sam- pling. All returned KIMs in tills down-ice from the targets, supporting the presence of kimberlite, while eight of the 10 target areas contained diamond indicator miner- als (DIMs). The Kahuna Project covers three main dikes, plus flanking ground that cov- ers the prospective source regions on the main indicator mineral trains and several interpreted folded greenstone belts. In January 2015, Dunnedin released a maiden inferred resource estimate on the Kahuna and Notch kimberlites (the only two with significant drilling) based on data from the 2006 to 2008 bulk sampling and drill pro- grams completed by the previous operator. Highlights include a combined inferred Dunnedin Ventures Dunnedin Ventures Ceo, Chris taylor, pGeo, on site at the Kahuna diamond and gold project, Nunavut. photo courtesy Dunnedin Ventures Inc.

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