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Hudson Resources finds diamonds, expands licence area

2004-09-15 14:35 ET - News Release

Mr. James Tuer reports

HUDSON ANNOUNCES LARGEST GREENLAND DIAMOND FIND AND EXPANDS LICENCE AREA

Hudson Resources Inc. has recovered a total of 120 diamonds greater than 106 microns in size from one sample location in west Greenland (see sieve results reported below). Of these diamonds, nine are classified as macrodiamonds (defined as remaining on the plus-0.5-millimetre-square mesh sieve). The three largest diamonds measured 1.90 by 1.70 by 1.42 millimetres; 1.98 by 1.34 by 0.98 millimetres; and 1.56 by 1.40 by 1.16 millimetres. This 107.9-kilogram kimberlite sample also contained another 31 microdiamonds in the 75-micron size fraction. The complete caustic fusion diamond report prepared by the SRC Geoanalytical Laboratories, including individual stone size and description, is available on the company's website (www.hudsonresources.ca/files/srcreport.pdf).

The sample location has been named Garnet Lake because of the existence of visible garnets in the kimberlite matrix. The total Garnet Lake sample comprises a nodular rich selection of kimberlite (MHG9-5), a portion of matrix-dominant kimberlite (MHG9-7) and a representative kimberlite selection (MHG9- 13) processed separately. Additionally, samples totalling 144.65 kilograms collected from three other localities were marginally diamondiferous, yielding a total of four microdiamonds. The remaining 184.05 kilograms of kimberlite processed from three other localities failed to reveal diamonds.

 
  
 Diamonds in square mesh sieve sizes 
             (microns) 
  
 75 106 150 212 300 425 600 850 1180 
  +   +   +  +   +   +   +   +    + 
  
 MHG9-5 
 14  17  15  18   2   3   -   2    - 
  
 MHG9-7 
  9   4   6   3   3   1   1   1    - 
  
 MHG9-13 
  8  11   9  11   5   6   1   -    1 
  
 Totals 
 31  32  30  32  10  10   2   3    1 
  
 Sample      Weight   Total   Wt+   Wt- 
               (kg)  diamonds 
                      (mg) 
  
 MHG9-5       29.65    71     5.448 1.206 
 MHG9-7       21.20    28     3.769 0.500 
 MHG9-13      57.05    52     8.393 1.303 
 Totals      107.90   151    17.610 3.009 
 

Notes: "wt+" refers to the weight of macrodiamonds (greater than 500 micron); "wt-" refers to the weight of microdiamonds (greater than 75 microns and less than 500 microns).

The Garnet Lake sample site is a narrow drainage leading north into a 200-by-175-metre lake. Kimberlite was found across a width of approximately 15 metres at the mouth of the lake and samples could be traced back at least 40 metres to the south. The kimberlite is closely constrained to the drainage basin. No other kimberlite was found in the immediate area outside the basin or upon surveying around the lake. It is believed, therefore, that the kimberlite has been frost-heaved to the surface from a nearby in situ source below. The company intends to initiate a drill program to confirm the existence of buried in situ kimberlite and to determine its extent.

The Garnet Lake samples and a nearby sample yielding two diamonds were collected from the Sarfartoq exploration licence area. Through a joint venture with New Millennium Resources NL of Perth, Australia, Hudson has an 80-per-cent interest in all minerals except niobium and tantalum. It must meet minimum payments totalling $1-million over a four-year period. It has already met its minimum requirements for 2004.

As a result of these findings, Hudson has made an application to acquire the remaining 89 square kilometres of open ground to the north of the Garnet Lake area. Hudson now has an interest in 1,580 square kilometres (390,425 acres) of exploration ground in the Sarfartoq region of west Greenland (52 per cent of which is a 100-per-cent interest in the licensed and application areas and the balance representing an 80-per-cent interest in the mineral rights as described above).

"We are extremely pleased with the results from the Garnet Lake area," stated James Tuer, president of Hudson. "The really exciting aspect about the find at Garnet Lake is that it validates our belief that there should be further occurrences like this in the region based on the extent of the kimberlite indicator mineral chemistry found in the tills. We are currently undertaking work to determine the chemistry and geophysical response of this source in order to extrapolate it across the licence area. We expect to be in a position to initiate a drill program in February or March of 2005, when we can operate on the ice over the lakes."

The samples were processed by the Geoanalytical Laboratories at the Saskatchewan Research Council in Saskatoon, an independent laboratory. SRC GeoAnalytical Laboratories is accredited to the ISO/IEC 17025 standard by the Standards Council of Canada as a testing laboratory for specific tests. Dr. Mark Hutchison, of Trigon GeoServices Ltd., was in charge of the collection of the samples in Greenland and managed the chain of custody from the field to the SRC. He is co-ordinating the description and scientific interpretation of the finds in order to facilitate continuing exploration and drilling. Dr. John Ferguson oversaw the program and is a qualified person under National Instrument 43-101.