Mining Markets


Canterra and Margaret Lake make the grade

In October, joint venture partners Canterra Minerals (CTM:TSX-V) and Margaret Lake Diamonds (DIA:TSX-V) announced the discovery of a 1 by 1 by 1.4-mm, off-white, modified octahedral diamond, as well as several anomalous indicator minerals, on...

In October, joint venture partners Canterra Minerals (CTM:TSX-V) and Margaret Lake Diamonds (DIA:TSX-V) announced the discovery of a 1 by 1 by 1.4-mm, off-white, modified octahedral diamond, as well as several anomalous indicator minerals, on the Marlin property, about 220 km northwest of Yellowknife, N.W.T.

Finding a diamond in a till-sampling program is a very rare occurrence and may indicate there is a diamond-bearing kimberlite nearby. This is an exciting development for both companies, who are focused on diamond exploration in the Northwest Territories in the area between the Gahcho Kué and Snap Lake diamond mines.

There are only a handful of companies that are well-positioned for the next big diamond discovery in the Northwest Territories and I believe that Canterra Minerals and Margaret Lake Diamonds are two of them.

Canterra is led by Randy Turner, whose notable career achievements include guiding Winspear Diamonds from the discovery of the Snap Lake diamond deposit through to its sale to De Beers for $305 million.

Canterra (formerly Diamondex) inherited an extensive library of valuable exploration data from Winspear Resources after it was acquired by De Beers in 2000. Canterra has spent 15 years amassing a large proprietary dataset covering much of the southern portion of the Slave Geological Province.  A re-analysis of this data, using new advances in technology and techniques, has been used to acquire properties that host very promising diamond targets near Gahcho Kué and Snap Lake. Over 26,000 till samples make up part of this valuable database. To Turner’s knowledge, only three diamonds have been found in these till samples, and one of them comes from the Marlin property.

Margaret Lake Diamonds is led by mining engineer, analyst and investor Paul Brockington, who has over 50 years in the mineral business and was one of the first analysts to value Dia Met Minerals, prior to the Ekati diamond discovery. Brockington has a knack for identifying and acquiring large positions in early-staged companies. His successes include Dia Met Minerals, Aber Resources and more recently Lucara Diamond (TSX: LUC), Mountain Province Diamonds (TSX: MPV; NYSE-MKT: MDM) and Kennady Diamonds (TSXV: KDI), all of which have returned handsome returns for early investors.  At the age of 71, Brockington had no need to become the CEO of a public company, but he was enticed to Margaret Lake Diamonds after realizing the opportunity the company’s namesake property presented.

Buddy Doyle also joined the Margaret Lake team and sits as Director and VP of Exploration. Mr. Doyle led the team that discovered the Diavik diamond deposits in 1994-1995. Mr. Doyle is recognized by his peers in the exploration industry as an authority on diamond exploration and kimberlite geology.

Together, the Canterra and Margaret Lake management teams have been involved in the discovery of three of Canada’s four producing diamond mines; Snap Lake, Diavik and Ekati. Those are the kind of people I am excited to bet on.

The 260-sq.-km Marlin property lies along the north and west margins of Kennady Diamond’s property, which hosts a number of high-grade, diamond-bearing kimberlite pipes. Glacial ice directions indicate the diamond found on the Marlin property was not sourced from any of pipes on Kennady Diamond’s property.

In addition to an extensive till-sampling program, exploration on the northern portion of Marlin has included a detailed HeliFALCON gravity gradiometer survey combined with an airborne magnetic survey. These methods have proven very effective in identifying kimberlite targets and were instrumental in the discovery of the Kelvin and Faraday diamond pipes on Kennady Diamond’s property.

Additional results from the till-sampling program, as well as the airborne gravity survey are expected in the fourth quarter of 2014. The partners anticipate that the compilation of the subsequent data will identify and prioritize potential drill targets for future exploration programs.

Canterra and Margaret Lake currently have market capitalizations of just $6.7 million and $5 million, respectively. Any new diamond discovery in the region should have a significant impact on these companies.

— The information in this article does not constitute a research report. This article is solely the work of its author, Shayne Nyquvest, a registered Investment Advisor at Jordan Capital Markets Inc., a member of both the Investment Industry Regulatory Organization of Canada (“IIROC”) and the Canadian Investor Protection Fund (“CIPF”). The views (including recommendations) expressed in it are those of the author alone, and are not necessarily those of Jordan Capital Markets. The information contained herein is drawn from sources believed to be reliable, but the accuracy and completeness of the information is not guaranteed, nor in providing it does the author or Jordan Capital Markets assume any liability. The author owns shares in Canterra Minerals and Margaret Lake Diamonds.

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1 Comment » for Canterra and Margaret Lake make the grade
  1. Dr. Igor Kryvoshlyk says:

    Having over 30 years experience I would be happy to participate in diamond hunt using my Diamond Exploration System (published as an Internet open site/file).

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