Aviat Property, Nunavut
The Company’s interest in the 442,641 acre Aviat Property was previously governed by a joint venture agreement with BHP Billiton Diamonds Inc. (“BHPB”) and Hunter Exploration Group (“Hunter”). Initially, the Company held a 70% interest in the property, BHPB held a 20% interest and Hunter held a 10% carried interest. Stornoway is the Operator. BHPB chose not to participate for its share of the 2006 or 2007 Aviat Property exploration programs, and as a consequence of this election, its interest on the Aviat Property was reduced to approximately 14.4%. Under an assignment agreement between Stornoway and BHPB entered into in May 2008, BHPB assigned to Stornoway all of its interest in the Aviat Project and its rights to market all diamonds of Hunter produced from the Project in consideration for the assumption by Stornoway of BHPB’s obligations under the joint venture agreement, including their bulk sampling obligations and all future funding obligations. Acquisition of BHPB’s interest in the project brings Stornoway’s project interest to 90% (Hunter continues to hold a 10% interest, carried to production) and Stornoway’s diamond marketing rights for the Project to 100%.
Exploration Program Update and Status
Stornoway’s 2008 field program on the Aviat Project commenced in early May of that year. Exploration activities during 2008, and subsequently, concentrated on delineating the size and grade potential of the known kimberlite sheets within the Eastern Sheet Complex (”ESC”), in support of the first conceptual resource study at the project. Delineation drilling was also undertaken on the AV9 kimberlite pipe, discovered late in the 2007 program. Highlights of the 2008 exploration program at Aviat include the following:
- significantly expanded the lateral extent of the highly diamondiferous AV267 body from approximately 125 ha to more than 250 ha
- successfully collected 202 wet tonnes of kimberlite from AV267 at two surface exposures
- confirmed the pipe-like nature of AV9 and extended it to a minimum depth of 175m (longest continuous kimberlite intersection 195m)
- discovered a new kimberlite sheet within the ESC
- completed 23 diamond drill holes for a total of 3,225 m of drilling
- received results of an independent conceptual resource study at Aviat, highlights of which included:
- 12.4 to 16.0 million tonnes total content of kimberlite material from a conceptual model of four kimberlite dykes of the ESC; one interpreted dyke, ES 1 (previously known as A267), spans an area of some 260 hectares and represents about 78% of the total kimberlite volume
- 235 carats per hundred tonnes (cpht) +/- 30 cpht conceptual estimate of total diamond content, assuming 100% recovery of stones in all size fractions down to a +1.00 mm bottom cut-off and based on limited micro and macro diamond data collected during the 2003 to 2007 field campaigns
- 24.1 to 40.3 million carats in the ground, using the conceptual range of total content of kimberlite material, conceptual estimate of total diamond content and an allowance for approximately 5% internal dilution within the conceptual model
- recovered 302.7 carats, including a 3.99 carat stone, from 190.9 dry tonnes collected at two localities within the ES1 kimberlite, representing an overall diamond recovery of 159 cpht (for diamonds retained on a +1 DTC screen)
SRK Consulting (Canada) Inc. (”SRK”) an independent, international consulting practice, was engaged to (i) develop a conceptual geological model for kimberlite dykes of the ESC, (ii) provide a range of potential kimberlite volume and tonnage, and (iii) estimate conceptual total diamond content within the extent of the bodies as known from current drilling (see Press Release of September 8, 2008). The conceptual study does not include Aviat’s pipelike kimberlite bodies (AV1, AV4 and AV9), kimberlite sheets outside of the ESC (such as AV1W and AV5) or drill intersections of as yet un-named kimberlite sheets that have not yet been integrated into the overall geologic model.
Kimberlite dykes of the ESC comprise a series of stacked, subparallel, shallowly dipping (8-20 degrees) sheets that cover an area of approximately 260 hectares and are composed of macrocrystic, hypabyssal kimberlite and kimberlite breccia assumed to represent a single phase of kimberlite magma. In order to simplify the historical naming convention of the outcropping sheet-like kimberlites at Aviat (AV267, AV38, etc.), the bodies in this conceptual geological model have been re-classified by SRK into four main sheets referred to as ES 1, ES 2, ES 3 and ES 4.
The conceptual geological model developed by SRK (see Press Release of October 7, 2008) consists of four distinct dyke horizons, the largest of which, ES 1, is interpreted to extend continuously from the original AV6 surface discovery southeast to the original AV8 discovery, average 1.7m true thickness and underlie the entire 260 hectare area. One of the three other distinct dykes modelled by this study, ES 2 (1.3m average thickness), is a hanging wall dyke situated 10-20m above the northwest part of ES 1, and the two other bodies, ES 3 (1.3m thick) and ES 4 (0.9m thick), are stacked footwall dykes situated 10-20m, respectively, below the southeastern extent of ES 1.
A total of 96 vertical and inclined drill holes spaced at roughly 150 to 300m intervals, of which 81 encountered kimberlite intersections from a few centimetres to 16.0m in thickness, have been incorporated into the conceptual geological model by SRK. Kimberlite intersections were classified into one of the four main ES dykes based on elevation. For horizons with multiple, close spaced kimberlite intersections separated by non-kimberlitic country rock, the kimberlite units were grouped into a single envelope so long as kimberlite units were greater than or equal to 0.25m in thickness and separated by less than 1.5m of country rock. This inclusion of internal waste provides approximately 5% internal dilution, therefore the overall proportion of kimberlite within the current geological interpretation is approximately 95%. At this stage it is impossible to estimate potential mining dilution. The volume of kimberlite dyke generated by the current conceptual model is estimated to be in the range of 4.7 to 6.1 million cubic meters, with the higher volume estimate including a down dip extension to the regional scale northwestsoutheast trending Centennial fault zone (used as the southwestern limit for the purposes of this conceptual geological model). Some 72 to 78% of the total kimberlite volume is attributed to ES 1. The average specific gravity determined from 18 samples collected to date is 2.63 g/cc, providing the tonnage ranges of 12.4 to 16.0 million tonnes reported above.
Total diamond content estimation of the ES dykes (235 +/- 30 cpht undiluted) was determined by SRK using both micro and macro diamond data provided by Stornoway. A total of 529 microdiamonds from 409 kg of drill core, and 33.40 carats of diamonds totalling 979 macrodiamonds obtained from 20.56 tonnes of bulk sample material, were used to produce the total diamond content estimate. The estimate is considered conceptual in nature, uses a 1.0mm (+2 DTC Sieve) bottom cut-off and assumes 100% recovery of stones of all size fractions. No corrections were applied for breakage and/or loss of smaller diamonds that would typically occur during recovery of diamonds in a commercial dense media separation (DMS) plant. The increase of the estimated total diamond content from the previously reported raw bulk sample grade of 162 cpht (see Press Release of January 29, 2008) can be attributed to both this small diamond recovery factor, and also to undersampling of the larger size distribution (+11 to +23 DTC Sieve Classes) of the diamond population. The relatively small bulk samples collected to date do not appear to have representatively sampled the entire size distribution. Larger tonnage samples are required to verify the estimate of diamond content. Quantification of commercial diamond recoveries is extremely difficult at this stage of the projectdue to numerous factors that need to be studied in greater detail (for example: economical bottom cut-off; efficiencies of the process plant; diamond breakage and/or loss; etc.). However, SRK has stated that in a commercial DMS plant it is not unreasonable to expect a 15-20% reduction in recovered diamonds from the total diamond content estimation assuming a similar bottom cut-off of +1.00 mm.
The above estimates are conceptual in nature and do not constitute the estimation of a mineral resource. To date there has been insufficient exploration to define a mineral resource in terms of NI 43-101 for the ES dyke complex and it is uncertain at this stage if further exploration will be able to delineate a mineral resource. The conceptual geological model incorporates kimberlite dykes previously referred to AV267, AV3 Upper, and AV8 Upper (ES 1), AV2 Upper (ES 2), AV3 Lower, AV8 Middle and AV8 Lower (ES 3 and ES 4). Some significant kimberlite intersections could not be incorporated into the current model due to uncertainties in lateral continuity as a result of the relatively coarse drill pattern. ES 1 remains open down-dip to the southwest (across the Centennial Fault) as well as to the southeast along strike. Additional drilling could potentially expand the outlines of ES 1, ES 2 and ES 3, as well as allowing the correlation and delineation of unincorporated kimberlite intersections. Revisions to the model are anticipated on an ongoing basis as new information becomes available.
Subsequent to the SRK conceptual resource study, Stornoway reported final results from the processing of a total of 190.9 dry tonnes of kimberlite collected during 2008 from two exposures of the ES1 kimberlite (see press release of May 5, 2009). A combined total of 302.7 carats of diamonds have now been recovered, representing an overall diamond recovery of 159 cpht for stones retained on a +1 DTC screen. The three largest diamonds recovered from this sample are 3.99, 1.72 and 1.22 carats, described as an off white clivage, grey clivage and a white octahedron, respectively. The 3.99 carat stone represents the largest diamond recovered to date from the Aviat project.
The first tranche of sample, collected at the historical “AV6″ outcrop (see press release of February 19, 2008) returned 89.6 carats of diamonds from 42.7 dry tonnes of kimberlite, representing a diamond recovery of 210 cpht for stones retained on a +1 DTC screen. The second tranche of sample, collected at the historical “AV2″ outcrop, returned 213.2 carats of diamonds from 148.3 dry tonnes of kimberlite, representing a diamond recovery of 144 carats per hundred tonnes (cpht) for stones retained on a +1 DTC screen.
The two outcrop samples were processed separately, but represent exposures of the same “ES1″ kimberlite sheet. Diamond recovery data for the individual samples, following Dense Media Separation (”DMS”) processing and utilizing both x-ray sorter and grease table recovery circuits, are as follows:
| Sample | Dry Weight (tonnes) | Stones (retained on +1 DTC screen) | Carats (retained on +1 DTC screen) | Diamond Content1 (cpht)2 | Largest Diamonds (carats) |
|---|---|---|---|---|---|
| ES1 Part 2 (”AV2″-2008) |
148.27 | 5,3993 | 213.15 3 | 144 | 3.99, 1.72, 1.22 |
| ES1 Part 1 (”AV2″-2008) |
42.67 | 2,4473 | 89.553 | 210 | 0.81, 0.77, 0.67 |
| Total ES1 | 190.94 | 7,8463 | 302.70 | 159 | - |
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1The estimated diamond content, expressed as carats per hundred tonnes, may not be representative of the overall diamond content of the body due to a number of factors, including location/size of the samples and processing parameters. 2Carats per hundred tonnes 3Represents only stones retained on a +1 or greater DTC screen, as discussed below |
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All previously reported DMS results from kimberlite outcrops considered to be part of the ES1 kimberlite sheet are provided in the table below. The weighted average diamond content for the three larger samples (211.5 tonnes) is 159 cpht. Individual differences in diamond content are interpreted as natural variations due to the relatively small sample size. The improvement evident in the three most recent samples is ascribed to the increased sample size, and the collection of fresher, more representative kimberlite. The weighted average diamond content for all six samples (218.3 tonnes) is 156 cpht, and the three largest stones are 3.99, 3.64 and 1.72 carats.
| Disclosure Date | Sample Type | Dry Weight (tonnes) | Carats | Diamond | Largest Diamond (carats) |
|---|---|---|---|---|---|
| May 5, 2009 | Outcrop ES1 Part 2 (”AV2″- 2008) |
148.27 | 213.15 | 1443 | 3.99, 1.72, 1.22 |
| February 19, 2009 | Outcrop ES1 Part 1 (”AV6″- 2008) |
42.67 | 89.55 | 2103 | 0.81, 0.77, 0.67 |
| January 21, 2008 | Outcrop “AV2″ (2007) | 20.60 | 33.36 | 1624 | 3.64, 0.55, 0.53 |
| January 11, 2007 | Outcrop “AV2″ (2005) | 2.19 | 1.58 | 724 | 0.19 |
| July 11, 2006 | Outcrop “AV7″ (2005) | 2.32 | 1.78 | 774 | 0.19 |
| June 21, 2006 | Outcrop “AV6″ (2005) | 2.15 | 2.08 | 974 | 0.10 |
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1 The estimated diamond content, expressed as carats per hundred tonnes, may not be representative of the overall diamond content of the body due to a number of factors, including location and size of the samples or drill holes 2 Carats per hundred tonnes 3Represents only stones retained on a +1 or greater DTC screen 4Represents only stones retained on a +0.85mm square mesh screen |
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In March of 2008 Stornoway also reported diamond recovery results from the Aviat Project’s AV1 and AV2 Upper kimberlites, located on the Melville Peninsula in eastern Nunavut, Canada. A total of 48.9 dry tonnes of material from the AV1 kimberlite was collected in 2007 and processed by Dense Media Separation (DMS), recovering 43.41 carats of diamonds for an indicated diamond content of 89 carats per hundred tones (cpht) for stones retained on a 0.85mm square mesh screen. The three largest diamonds recovered from this work were a 0.53 carat colourless macle, a 0.50 carat grey clivage and a 0.49 carat colourless macle.
Previously reported results (Stornoway press release of October 21, 2004) from AV1 comprised 8.54 carats of diamonds recovered from 10.28 dry tonnes of processed material, for an indicated diamond content of 83 cpht (stones retained on a 0.85mm square mesh screen). The largest diamond recovered from this previously reported work was 0.40 carats. Combining this historical result with the new DMS data reported above provides a ‘global’ summary for the AV1 body of 88 cpht (51.95 carats from 59.19 dry tonnes).
Also during 2007, a total of 6.24 dry tonnes of the AV2 Upper kimberlite was collected and processed by DMS to yield 4.99 carats of diamonds for an indicated diamond content of 80 cpht for stones retained on a 0.85mm square mesh screen. The three largest diamonds recovered from this work were a 0.30 carat colourless broken octahedron, a 0.23 carat colourless octahedron and a 0.13 carat grey tetrahexahedroid.
Details of the new AV1 and AV2 Upper results are provided below:
| Kimberlite | Dry wt. (tonnes) | +0.850 mm | +1.18 mm | +1.70 mm | +2.36 mm | +3.35 mm | No. Stones >0.85mm | No. Stones >1.18mm | Carats Recovered1 | Diamond Content2 (cpht)3 |
|---|---|---|---|---|---|---|---|---|---|---|
| AV1 | 48.91 | 1035 | 485 | 137 | 36 | 5 | 1698 | 663 | 43.41 | 89 |
| AV2 Upper | 6.24 | 139 | 73 | 12 | 2 | 0 | 226 | 87 | 4.99 | 80 |
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1 Represents stones retained on a +0.85mm square mesh screen 2 The estimated diamond content, expressed as carats per hundred tonnes, may not be representative of the overall diamond content of the body due to a number of factors, including location and size of the samples 3 Carats per hundred tonnes |
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The AV9 pipe, discovered at the end of the 2007 field season, is described as a transitional kimberlite pipe, containing both macrocrystic hypabyssal and transitional hypabyssal breccia phases. The initial 2007 drilling intersected kimberlite within a horizontal area measuring approximately 60 x 60 meters, and to a vertical depth greater than 100 meters, but neither the lateral nor vertical extent of AV9 could be determined at that time. Caustic fusion of 307.26kg (dry) of kimberlite core from AV9 returned 236 diamonds (stones retained on a 0.106mm square mesh sieve), conclusively demonstrating that the body was diamondiferous and comparable to other kimberlite bodies at the Aviat Project (see press release of December 12, 2007). Drilling at AV9 in 2008 consisted of nine holes (two incomplete) totalling 1,144m. Of the holes that cut the AV9 body, kimberlite intersections ranged from 19.1m to 195.4m, suggesting a lenticular shaped body. The latter hole collared in kimberlite and remained in kimberlite until the end of the hole at 215m, suggesting a minimum vertical depth of 175m below current surface for the AV9 body. Kimberlite core has been submitted for caustic fusion analysis, and results will be reported when available.
Diamond results reported above are based on work completed by Microlithics Laboratories, Thunder Bay, Ontario, an independent mineral process laboratory currently providing services exclusively to Stornoway and its affiliates. The samples were processed through a 1.5 tonne per hour (tph) DMS plant designed to recover stones retained on a 0.85mm square mesh sieve. Kimberlite was prepared through a primary jaw crusher, with -10 mm material fed directly into the DMS. All +10 mm material was subsequently reduced through secondary cone crushing. DMS concentrates were submitted for caustic fusion and the residues hand sorted to extract diamonds. As part of Stornoway’s ongoing QA/QC programs, DMS tails, concentrate residues and other materials are subject to audit. Stornoway’s diamond exploration programs are conducted under the direction of Robin Hopkins P.Geol. (NT/NU), Vice President, Exploration, a Qualified Person under NI 43-101.
Planned Exploration Activities for 2009
Stornoway expects to conduct a market valuation exercise on the full parcel of diamonds recovered from the ES1 kimberlite sheet, once the world rough diamond market, which is currently experiencing internal financial volatility, has stabilized such that pricing information suitable for long term, advanced level, exploration planning can be obtained. Although this valuation work, being based on a small parcel of diamonds, will provide only a preliminary sense of the average diamond price at Aviat, it will be sufficient, in conjunction with the October 2008 conceptual study, to provide a qualified estimate of value contained within the ESC. This estimate will in turn support subsequent desktop studies aimed at determining optimum mining scenarios for the ESC. The conclusions of these studies will dictate the nature and type of future sampling required to obtain a National Instrument (”NI”) 43-101 compliant mineral resource statement at Aviat.
During the year ended April 30, 2009, the Company wrote-off capitalized acquisition and exploration costs totaling $5.1 million, which can be attributed to parts of the land package no longer retained by the Company, including all of the Aviat Two property interest. The carrying value of Aviat One as at April 30, 2009 is $20.7 million. Please see the section “Critical Accounting Estimates – Impairment of Long-lived Assets” below for a description of the impairment testing completed for the Aviat One Property during the year ended April 30, 2009.
Churchill Property, Nunavut
The Company acquired an initial 35% interest in the diamond rights to the Churchill Property pursuant to a letter agreement dated June 13, 2002. A joint venture agreement was executed as of August 1, 2004, among the Company, BHPB and Shear Minerals Ltd. (“Shear”). In July 2007, Stornoway increased its interest in the Churchill property to 41.86% by acquiring a portion of BHPB’s interest in the Churchill Project in consideration of a cash payment of $1,250,000 and by issuing 2,200,000 common shares with a fair value at the time of issuance of $2,134,000. Shear acquired the remainder of BHPB’s interest concurrently. As a result, Shear and Stornoway now own a 58.14% and 41.86% interest, respectively, in the project. The Churchill Property is subject to a 2% GOR/NSR in favour of Hunter. Hunter retained the non-diamond mineral rights to the property and has since transferred those rights to a third party. Stornoway elected not to participate for its share of the 2008 exploration budget. As a consequence of this election, its ownership in the Churchill Project could potentially dilute from 41.86% to approximately 38%. As of the report date, the Company does not know the full cost of the 2008 exploration program, and has not been informed by Shear of any dilution calculations.
The Churchill Diamond Project currently encompasses approximately 742,000 acres situated on the mainland tundra (barren lands), near the community of Rankin Inlet in the Kivalliq Region of Nunavut, Canada. Shear is operator of the Churchill Diamond Project.
Exploration on the property commenced in 2002 with an airborne magnetic survey and progressed in subsequent years with sampling, prospecting, drilling and analysis. In 2007, a bulk sample was completed from three pits on the Kahuna kimberlite and a further 16 kimberlite occurrences were identified in outcrop and subcrop. In June 2008, the Company announced that additional macrodiamonds had been recovered from an audit of tails from each of the three 2007 Kahuna bulk samples. Based on the results of the audit, the calculated diamond grade for Kahuna has the potential to increase from 96 cpht to 104 cpht. Shear was reportedly in the process of finalizing arrangements for an independent market valuation exercise for the Kahuna diamonds, to be conducted in Antwerp, Belgium.
In July 2008, Stornoway and Shear announced that the joint venture approved up to a $3.8 million exploration program for 2008 including: mini-bulk sampling of the Notch kimberlite, 400 infill till samples, testing of ground gravity and ground penetrating radar surveys over known diamondiferous kimberlite dyke structures, intensive prospecting and structural interpretation over high priority geochemical areas, testing of 25-50 targets with a lightweight drill, late summer core drilling to test up to 20 targets, selected ground magnetic surveys over new areas and ongoing environmental baseline data collection and reclamation. Stornoway elected not to participate for its share of the 2008 exploration budget.
In September 2008, Shear informed Stornoway that a total of nine new kimberlites had been discovered from prospecting and drilling in 2008, bringing the total to 88 known kimberlite occurrences on the property to date. Shear also collected 26.1 wet tonnes of kimberlite from surface exposures of the Notch kimberlite, tested 40 targets with a reverse circulation drill resulting in the discovery of two kimberlites, completed 14 core drillholes testing 10 targets resulting in the discovery of one new high-interest kimberlite system, discovered 24 new kimberlite float occurrences plus seven new outcrop/subcrop occurrences, collected 455 till samples to infill known priority areas and undertook limited ground geophysical surveys. Outstanding exploration results expected from the 2008 Churchill work program include macrodiamond results from DMS processing of the 26 tonne Notch kimberlite, additional microdiamond analyses from drilling and prospecting discoveries, and indicator mineral results from till samples. A total of 11 drillholes from seven setups have been drilled into the vertical, 1.5m wide, Notch kimberlite dyke, which trends for more than 3 km based on geophysical interpretation. As at the report date, Shear had not yet proposed a program for 2009.
During the year ended April 30, 2009, the Company wrote-off capitalized acquisition and exploration costs totaling $6.8 million for the Churchill property interest, after determining that an impairment existed. The carrying value of Churchill, subsequent to this write-down, is $7.9 million as at April 30, 2009. Please see the section “Critical Accounting Estimates – Impairment of Long-lived Assets” below for a description of the impairment testing completed for the Churchill Property during the year ended April 30, 2009.
Qilalugaq Property, Nunavut
The Qilalugaq Property is 1.04 million acres and lies on the Melville Peninsula in Nunavut. The Qilalugaq property was acquired by BHPB in 2001 and has undergone several phases of exploration using airborne geophysics (magnetics, electromagnetics and gravity surveying), together with property wide till sampling, drilling and limited mini-bulk sampling. Eleven kimberlites were discovered by BHPB as a result of this work, ten of these were analysed and proven diamondiferous. The Qilalugaq bodies share geological similarities with the Aviat bodies and appear to be the same age. The largest kimberlite identified by BHPB is a complex made up of the Qilalugaq 1, 2, 3, and 4 pipes which coalesce to form a body with an approximate area of 14 ha. Other drill confirmed bodies range in size from 0.8 to 11.0 ha based on interpretation of geophysical data. A mini-bulk sample of 229.7 dry tonnes extracted from the Qilalugaq 1-4 (Q1-4) complex by RC and core drilling returned a total of 61.37 carats (for stones greater than 1.1 mm), indicating a calculated diamond content of 27 cpht. The Q1 body, approximately 5.4 ha in size, was not tested with RC drilling and is therefore under represented in this mini-bulk sample. Stornoway has subsequently discovered seven additional dyke-like kimberlite bodies by prospecting, bringing the total of kimberlites known on the property to 18. Under the terms of an option agreement signed between BHPB and Stornoway on July 10, 2006 and as revised June 5, 2008, Stornoway can earn 50% in the project from BHPB by spending $9 million before December 31, 2012.
During the 2007 diamond exploration program at the Qilalugaq project, Stornoway discovered four new kimberlite dykes by prospecting (Naujaat 3 through Naujaat 6, inclusive) and collected almost 27 wet tonnes of kimberlite from five bodies for macrodiamond recovery through a DMS plant, including an estimated 22.3 tonnes from the Q1 (aka A28) pipe, 0.7 tonnes from Naujaat 1, 1.0 tonne from Naujaat 2, 1.8 tonnes from Naujaat 3 and 1.1 tonnes from Naujaat 6.
In June 2008, Stornoway reported results from DMS processing of the single 20.28 dry tonne sample collected during 2007 from the outcropping Q1 (aka A28) kimberlite. This sample returned a total of 6.081 carats of diamonds, indicating a diamond content of 30 cpht for stones retained on a 0.85mm square mesh screen. The largest intact diamond recovered from this sample was a 0.37 carat light brown irregular stone. Some 25 pieces of a larger but mechanically broken colourless stone were recovered, representing an original crystal weight of at least 0.7925 carats. Other unrecognized fragments of this diamond may impact the stone counts. The Q1 (A28) diamonds are described as a mix of mostly octahedral and tetrahexahedroid forms. Stone colours range from colourless to light brown, with a small component of yellows.
| Sample | Dry Weight (tonnes) | No. Stones >0.85mm | Carats1 | Diamond Content2 (cpht)3 | Largest Diamonds (carats) |
|---|---|---|---|---|---|
| 2007 Q1 (A28) | 20.28 | 193 | 6.081 | 30.0 | 0.794, 0.37, 0.36, 0.29 |
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1 Represents stones retained on a +0.85mm square mesh screen 2 The estimated diamond content, expressed as carats per hundred tonnes, may not be representative of the overall diamond content of the body due to a number of factors, including location and size of the sample 3 Broken stone (minimum weight as measured from 25 recovered pieces) |
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Small 2007 DMS samples collected from Naujaat 1, 2, 3 and 6 were processed to gain greater information on potential macrodiamond content. The reader is cautioned about drawing conclusions from the processing of small samples especially when dealing with lower grade kimberlite bodies. Apparent variations or discrepancies in diamond content may be attributable to natural factors, surficial weathering, collection issues, processing and recovery parameters, etc. Although the sample sizes are too small to accurately reflect total diamond content, only the Naujaat 1 body returned any diamonds on the 0.85mm or greater square mesh screen, as reported below.
| Sample | Dry Weight (tonnes) | No. Stones >0.85mm | Carats1 | Diamond Content2 (cpht)3 | Largest Diamonds (carats) |
|---|---|---|---|---|---|
| Naujaat 1 | 0.588 | 4 | 0.0305 | 5.2 | 0.0080 |
| Naujaat 2 | 0.913 | 0 | n/a | n/a | n/a |
| Naujaat 3 | 1.703 | 0 | n/a | n/a | n/a |
| Naujaat 6 | 0.998 | 0 | n/a | n/a | n/a |
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1 Represents stones retained on a +0.85mm square mesh screen 2 The estimated diamond content, expressed as carats per hundred tonnes, may not be representative of the overall diamond content of the body due to a number of factors, including location and size of the sample |
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The 2008 exploration program focused on un-sourced indicator mineral trains with promising chemistry, and on September 04, 2008, Stornoway announced discovery of a new kimberlite body, Naujaat 7, bringing the total to 18 kimberlites on the property. Naujaat 7 was identified from a linear series of discontinuous occurrences of frost heaved kimberlite fragments and boulders extending over a 700m strike length. The host structure is as narrow as 1-2m in places and, based on the presence of associated alteration, can be traced for a minimum additional strike length of 1.3km and possibly for as much as 6km total. Naujaat 7 has been confidently traced over only 700m of that 6km, and a small sample has been collected for diamond recovery by caustic fusion.
No drilling or mechanized trenching has been undertaken on any of the Naujaat 1 to Naujaat 7 kimberlite dykes and they have been identified from surface expressions only. Surface expressions of kimberlite subcrop, float boulders and disaggregated frost heaved ‘green tills’ are exposed intermittently along the host structures and lateral continuity is not assured. Similarly, reported widths are based on widths of the host structure, where constrained by outcropping country rock, and may not reflect true width. Many of the structures are open along strike and have not been completely prospected (see summary table below). All of these bodies lie within a 26 km long, structurally favourable belt that appears to have been exploited by kimberlite magmas rising from the mantle, including the 11 kimberlite pipes discovered previously (0.8 to 11.0 ha based on drilling and interpretation of geophysical data).Prospecting in the vicinity of other unsourced mineral trains on the property did not discover any other kimberlite,and as a consequence these anomalous areas remain unexplained. Additional till samples were collected in 2008 to help identify the source bodies.
| Kimberlite | Discovery Date | Prospected Length (subcrop, float, etc.) | Width of Host Structure | |
|---|---|---|---|---|
| Naujaat 1 | 2006 | 3160 m | 4.5 m west end1.5 m east end | West-Northwest |
| Naujaat 2 | 2006 | 1400 m | 2.3 m | West-Northwest |
| Naujaat 3 | 2007 | 3000 m | 5 m | West-Northwest |
| Naujaat 4 | 2007 | 100 m | Unknown | West-Northwest |
| Naujaat 5 | 2007 | 2000 m | 4 m | East to West |
| Naujaat 6 | 2007 | 500 m | 3 m | East to West |
| Naujaat 7 | 2008 | 700 m | 1-2 m | East to West |
Surface expressions of kimberlite subcrop from Naujaat 1 to 4, Naajaat 6 and Naujaat 7 were sampled to determine microdiamond content by caustic fusion analysis. The Naujaat 5 kimberlite occurs only as disaggregated frost heaved ‘green tills’ for which no fresh representative sample could be collected. Naujaat 7 has not yet been processed due to current financial constraints. Available caustic fusion results are summarized in the table below. Recovery of +0.60 and +0.85mm stones from Naujaat 1 and Naujaat 4 during caustic fusion is considered to be a positive development.
| Body | Sample Weight (kg) | NUMBER OF DIAMONDS PER SIEVE SIZE (MM SQUARE MESH SIEVE) | Total Stone Count | ||||||
|---|---|---|---|---|---|---|---|---|---|
| +0.106 mm | +0.150 mm | +0.212 mm | +0.300 mm | +0.425 mm | +0.600 mm | +0.850 mm | |||
| Naujaat 1 | 320.89 | 76 | 40 | 33 | 27 | 12 | 3 | 0 | 191 |
| Naujaat 2 | 71.80 | 9 | 4 | 4 | 2 | 0 | 0 | 0 | 19 |
| Naujaat 3 | 243.30 | 0 | 8 | 4 | 2 | 2 | 0 | 0 | 16 |
| Naujaat 4 | 94.75 | 13 | 12 | 13 | 2 | 1 | 1 | 1 | 43 |
| Naujaat 5 | 0.00 | insufficient fresh material for meaningful caustic fusion sample | |||||||
| Naujaat 6 | 158.40 | 14 | 14 | 5 | 1 | 1 | 0 | 0 | 35 |
| Naujaat 7 | ~44.00 | results pending | |||||||
An expectedly long drill program associated with the ongoing development of a conceptual kimberlite resource at Stornoway’s Aviat Project, coupled with other logistical considerations, prevented the drilling of promising geophysical targets on the Qilalugaq Property during the 2008 season. Additional work for 2009 may occur, pending financial and logistical concerns.
Timiskaming Diamond Project, Ontario/Quebec
The Timiskaming Diamond Project is located in northeastern Ontario/northwestern Quebec. The Company, through its wholly-owned subsidiary Contact Diamond Corporation (“Contact”) currently maintains a 100% interest in over 280,000 acres of exploration licenses and has to date discovered nine kimberlite bodies in the region. The 95-2 pipe on the property yielded a population of highly commercial diamonds at marginally sub-economic grades in a minibulk sample program conducted between 2003 and 2004. Between 2005 and 2006, Contact identified several new kimberlitic indicator mineral trains in the area suggesting the existence of multiple, to date undiscovered kimberlites in the area. Stornoway commenced exploration on landholdings in the Timiskaming area in mid-May 2007, after acquiring Contact, and to date has completed a detailed airborne survey over the head of un-sourced mineral distribution trains on the Elk Lake Property; undertaken anomaly checking and ground geophysical surveys of potential targets; collected detailed till sampling over specific areas of interest; and continued regional exploration activities. No targets were drill tested during 2008, and plans for 2009 remain on hold due to current market conditions.