Fyi..From another Board ...
PUBLICATION: WINNIPEG FREE PRESS
DATE: 2005.01.06
PAGE: B7
SECTION: City
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Glittering visions of diamonds lure firms to Manitoba's north
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CP Wire Michelle MacAfee On a Friday morning last month, geologist Kevin Keough was filled with heady excitement, hoping his junior mining company had its hand on a property that would catapult his one-employee operation into the big leagues.
But in attempting to stake his claim to the large parcel of land in northern Manitoba that he believes could contain diamonds, silver, lead and zinc, the Ontario geologist was soon faced with an almost unbelievable good-news bad-newsscenario.
Diamond giant De Beers had beaten him to the punch by mere hours, snapping up the rights to a massive 20,000-square-kilometre chunk of land that included much of the area Keough was eyeing.
"That's when all the wheels fell off," Keough said yesterday.
"We realized then we had major competition. But for De Beers to do what they did is also a big stamp of approval for the Manitoba industry." Keough, whose company Nustar Resources of Toronto is partnering with one of De Beers' main rivals, BHP Billiton, still managed to get his hands on 35,000 hectares he believes are resource-rich.
And it seems he didn't have a minute to spare. Word that two of the world's biggest mining companies were suddenly on the hunt for diamonds in northern Manitoba has travelled fast, sparking a run on exploration licences and renewing hopes the industry could rebound from recent closures.
"Here we are a pip-squeak company teamed with the biggest mining company on the planet, surrounded to the horizon by the biggest diamond company in the world," Keough said with a laugh.
A spokesman for the Manitoba government says it issued 167 exploration licences in 2004, up from 60 in 2003.
More than a dozen of those were issued in the last three weeks, once juniors found out about De Beers' claim, said Gary Ostry, manager of minerals policy and business development.
"Diamond exploration is a sophisticated game," Ostry said.
"We have always maintained that area has a very high mineral potential for diamonds and other minerals, so we're not surprised De Beers has taken such a huge land position, but we're certainly excited about it." There is also measured excitement slowly creeping across northern Manitoba, where most of the coffee talk in recent years has been about closures and other negative projections for the region's mines.
"I don't think anybody is ready to go nuts because they think everything is going to take off," said Bruce Krentz, manager of the Norman Regional Development Corp.
"But there are lots of hopes and everyone is happy to see some good news again." There are two diamond mines operating in Canada -- BHP's Ekati mine and the Diavik mine owned by Rio Tinto/Aber Resources, both in the Northwest Territories. Two other mines in the territory are expected to begin production within the next few years.
A spokesman for De Beers could not be reached for comment. This is the company's second close look at northern Manitoba. It pulled out of the province just last year after leading the first diamond-staking rush in northeastern Manitoba in 1999, Ostry said.
With only about one of every 1,000 exploration programs evolving into a commercial mine, both Ostry and Keough are quick to caution there are years of work ahead of any potentialproduction.
Nustar, which is set to merge with Candor Ventures to operate the exploration program for BHP, is scheduled to drill at least six test sites in April.
The outcome will determine whether they focus on diamonds, silver, lead or zinc, and how soon they might try to build a mine, if at all.
The way Keough sees it, while things didn't turn out quite the way he planned, his business future has a little more sparkle now than it did a few months ago.
"This is company-maker property," said Keough. "We could, with some success, make our company either from the base metals or from the diamonds. We don't really care how we do it." -- Canadian Press
