CEO Jim Paterson concisely sums up Kivalliq’s (TSXV:KIV) recent $20 million exploration program stating “2012 was another year of discovery on the Angilak Property in Nunavut, particularly within the Lac 50 Trend. We are confident that our pending drill results will add significant value to this project.”
This past year, Kivalliq drilled in excess of 38,000 metres, the results of which will likely add additional inferred resources to the company’s overall resource base. At last report the company’s Lac Cinquante deposit hosts a NI 43-101 inferred resource of 1,779,000 tonnes grading 0.69% U₃O₈, totaling 27.13 million pounds U₃O₈.
In the remote Nunavut region, where infrastructure is limited at best, costs for development of new mines is high. In order for this project to be considered economic in the future, Kivalliq must continue to expand its uranium resource base as well as prove that its current resource is potentially minable.
With the discovery of the J4, Ray, Flare and Southwest Zones within the Lac 50 Trend, Kivalliq is demonstrating to the market that its Angilak property has the potential to host multiple uranium deposits. Each new discovery adds to the value of the project and could improve the overall economics of the project down the line.
The figure below shows the relative location of the Lac Cinquante deposit which consists of the Main zone (MZ), Western and Eastern Extensions (WE & EE) and the new discoveries, J4, Ray and Flare.
The Lac 50 Trend is a three kilometre wide by 15 kilometre long structural trend which hosts nine significant uranium occurrences discovered by Kivalliq since 2010. The J4 Zone is situated about 2.5 km east of the Lac Cinquante Deposit and has a strike length of 800 metres. Interestingly, mineralization at the J4 zone was intersected at a vertical depth of 383 metres. This represents the deepest mineralized intercept discovered on the property to-date and could indicate that the other deposits continue below their current drill-tested depth. The J4 zone remains open for expansion along strike as well as at depth.
This past year, drilling expanded uranium mineralization at the Lac Cinquante deposit down-dip and along the Lac 50 Trend.
The Potential for More Uranium Discoveries
Kivalliq’s aggressive reverse circulation (RC) exploration drilling campaign (5,273 metres in 38 holes) identified numerous potential mineralized zones. These new zones will be further tested by diamond drilling in 2013. In addition, results from geophysical surveys this season should continue to expand the company’s exploration targets.
Kivalliq expects to see assay results from an additional 93 holes prior to the end of the year and intends to incorporate these results into two new resources, expanding Lac Cinquante as well as defining new NI-43-101 compliant resources on the J4 zone and the Ray zones by the end of the first quarter of 2013. That should represent another significant stock catalyst for the company.
Kivalliq’s aggressive exploration campaign has identified numerous promising new zones of uranium mineralization and the company continues to expand and advance its current resource base demonstrating “District Scale” potential of the Angilak Property. As a further endorsement to its success, Kivalliq continues to attract high-caliber team members. The corporation recently added Jim Malone to its board of directors. Mr. Malone’s played an integral part in the growth of Hathor Exploration (taken over by Rio Tinto for CAD$650 million). His expertise in the nuclear fuel market and his extensive contact base in the industry should help Kivalliq on its path towards development.
Thomas Schuster – Analyst Bio
With a degree in Geological Sciences from the University of Toronto, Thomas started his career in the 1990s as an exploration geologist in the famous Timmins mining camp in Northern Ontario. He then moved to Vancouver and took a position as staff Journalist at the well-known mining publication, The Northern Miner, reporting the merits and shortcomings of Canadian exploration and mining projects worldwide. This built a foundation for his later work as a Mining Analyst for the Toronto-based institutional investment firm, Fraser Mackenzie. Thomas is currently based in Vancouver working as an independent mining analyst.
Disclosure: No positions at time of writing.
Kivalliq Energy is a client of Dig Media. Dig Media was paid a fee for the creation and dissemination of this commentary.