Mountain Province Diamonds Inc. [MPVD-TSX, NYSE] on Tuesday announced the discovery of a new kimberlite at its Gahcho Kue diamond mine in the Northwest Territories.
Gahcho Kue diamond mine is a joint venture between De Beers Canada Inc. (51%) and Mountain Province (49). It is a fly-in-fly out operation located 280 kilometres northeast of Yellowknife.
Gahcho Kue is the world’s largest new diamond mine and is expected to produce an average of 4.5 million carats per year (100%) over an initial 12-year lifespan. Production during the first five years (2017 to 2021) is expected to average 5.4 million carats annually.
On Tuesday, Mountain Province said the discovery of he “Wilson” kimberlite on the Gahcho Kue joint venture property marks the first kimberlite find in 20 years.
It said the new discovery has been named after Alice Evelyn Wilson (1881-1964), who is officially recognized as Canada’s first female geologist.
Based on the first 18 drill holes, the company estimates a potential range of 1.5-3.0 million tonnes of kimberlite material.
Kimberlites are carrot-shaped geological structures that sometimes, but not always, contain diamonds in economic quantities.
No grade estimates have been provided at this point, but an initial microdiamond analysis on a small 115 kilogram sample yielded 480 diamonds, including an 0.28 carat colourless octahedral aggregate.
Investors reacted by sending the shares up to a high of $1.62 on Tuesday. Later in the session, the shares slipped back to $1.46, marking an 0.68% or $0.01 increase from Monday’s closing price. The shares are currently trading in a range of $1.07 and $3.41.
The Wilson kimberlite is located roughly 200 metres east of the Tuzo kimberlite and was discovered during drill testing of geophysical and geological anomalies in the area. The company said it lies well within the open pit mine plan for the Tuzo kimberlite.
Mountain Province said further microdiamond and geological analysis of the existing drill core is underway, and further drilling is currently being planned.
Meanwhile the company said the winter 2019 exploration program at its 100%-held Kennady North Project has been completed.
The objectives of the winter program were to remove heavy equipment from previous bulk sampling programs, and to drill-test target areas located three to four kilometres southwest of the Gahcho Kue Mine. Mountain Province said the first objective was successfully completed, but it said drilling of priority targets was hindered by flight-restrictive weather for the helicopter-supported program.
Only five drill holes, totaling 917 metres of the 2,000 metre program were completed and no kimberlite was intersected. The untested targets will be reviewed for discovery potential and reprioritized along with other targets in the Kelvin-Faraday Corridor located northeast of Gahcho Kue.