Manitoba's Mineral Industry

Exploration and Development Highlights 2007

Current as of November 2007

Base Metals
Precious Metals
Specialty/Industrial Minerals


Sustained highs in metal prices continued to fuel exploration spending in Manitoba in 2007. Exploration and deposit appraisal spending intentions are estimated at $103.1 million, nearly double the $52.9 million spent in 2006.

Base Metals

Manitoba’s proven potential to host world-class nickel-sulphide deposits attracted a number of junior companies which conducted feasibility related work on previously discovered deposits and former producers.

Mine development at Bucko Lake nickel project – May 2007 (Photo courtesy of Crowflight Minerals Inc.)The most advanced project is that of Crowflight Minerals at the Bucko Lake deposit near Wabowden, south of Thompson. A positive bankable feasibility study was completed in February indicating Bucko has the potential to deliver a 118% internal rate of return with a US$8.00 per lb. nickel price. The study used a figure of 1.8 million tonnes of measured and indicated resources grading 2.1% nickel. This figure was subsequently upgraded to 2.5 million tonnes of measured and indicated resources of 2.01% nickel. Crowflight has received provincial approval for an environmental licence for Bucko’s operation but awaits federal approval for a tailings disposal site. The company has met all of its option commitments with Xstrata Nickel and now owns 100% of the project. Construction of surface infrastructure and rehabilitation of the old shaft proceeded throughout 2007. Capital cost of project development to production is estimated at $64 million. Crowflight plans to have Bucko in production in 2008 at a rate of 1000 tonnes per day.

In regional exploration, Crowflight completed approximately 10 000 m of drilling on their TNB South and TNB North project areas under option from Xstrata Nickel. Drilling was successful in further defining the extent of nickel mineralization at two new 2006 discoveries, the Apex and M11A North zones. A new zone was also identified 330 m north of the Bucko deposit where drilling intersected 7.5 m of 0.78% nickel. Drilling at Halfway Lake, 20 km north of Wabowden, intersected 10.0 m of 1.35% nickel. Similar results were encountered at the Halfway Lake project by Falconbridge Limited in the mid-1990s and the deposit remains open in all directions.

Approximately $100 million in capital spending was planned for 2007 at Vale Inco Limited’s Manitoba operations. Capital projects consist of smelter modernization including a new dust-capturing system, continued mine development and other work throughout the mines and processing plants. In October, Vale Inco announced intentions to work towards extending the life of its existing Thompson facilities to 2027 and beyond.

Ongoing drilling by Vale Inco near its Thompson mines has demonstrated significant potential for open-pit mining of two new deposits, the Thompson 1-C Surface zone and the 1-D Surface zone. Drilling projects to locate new zones of nickel mineralization are also returning encouraging results at depth at both the Thompson and Birchtree mines.

Victory Nickel Inc. completed a 13 000 m drill program at their Minago property north of Grand Rapids. Drillcore from the program is being used to upgrade the resource estimate for the deposit and to provide samples for metallurgical testing and geotechnical data. One of the better holes from the program returned 36.0 m of 1.4% nickel. Overall drill results were reported to support past work on the property. Wardrop Engineering is in the process of conducting a bankable feasibility study which is due for completion in October 2008. The Minago deposit hosts National Instrument (NI) 43-101-compliant measured and indicated resources of 49.1 million tonnes of 0.516% nickel. The economics of the project can be enhanced by the presence of frac sand and other non-mineral by-products that may be generated during the proposed open-pit mining process.

Victory Nickel also completed a 30-hole drill program at the Mel deposit located 25 km north of Thompson. The program was designed to expand the Mel resource figure and evaluate the near-term production potential. Drilling intersected significant grades over mineable widths including 13.7 m of 1.11% nickel. The Mel project is under option from Vale Inco and Victory has now completed the required exploration expenditures to earn 100% interest. Vale Inco has a back-in right which could lead to a 50:50 joint venture going forward. Mel has a NI 43-101-compliant indicated resource of 4.3 million tonnes of 0.88% nickel.

In Lynn Lake, Independent Nickel Corp. commenced a 20 000 m drill program at the past-producing Lynn Lake nickel mine. The intent of the drill program was to test four zones. In June, the company announced that drilling of the Upper G target intersected an unexpected zone of mineralization above the target area returning 11.9 m of 0.7% nickel and 0.4% copper. A prefeasibility study released in November concluded the project has demonstrably positive economics with a cash cost of producing refined nickel at $4.90 per pound at a production rate of 3000 tonnes per day. Results from metallurgical testing received in the fall confirmed that conventional milling and floatation processes will deliver very high metal recoveries from the nickel ores. The company is also actively pursuing the bioleaching of concentrate process and initial bioleach test work has been very successful in delivering high metal recovery rates.

Western Areas NL of Australia optioned ground covering the former EL mine in Lynn Lake operated by Sherritt Gordon Mines Limited. A versatile time-domain electromagnetic (VTEM) survey was conducted and an initial drill program of 5 holes tested 4 different targets. Wide zones of disseminated sulphides were reported from 3 of the targets but assays have not been released. The EL mine produced approximately 1.0 million tonnes of 3.3% nickel and 1.1% copper during operation from 1954 to 1963. Included in the option agreement is the McBride Lake zinc property located 70 km east of Lynn Lake.

Also near Lynn Lake, VMS Ventures Inc. completed a 3-hole drill program on their Carr Lake property. Drilling confirmed the presence of anomalous nickel and copper values within mafic-ultramafic rocks similar to those hosting the Lynn Lake nickel-copper deposits. A VTEM airborne survey was completed over VMS’s entire Lynn Lake property package consisting of 4 claim groups covering 5 of 7 known gabbro plugs in the Lynn Lake camp. The survey outlined a number of conductors for future investigation for nickel-copper mineralization.

In the last two years, VMS Ventures has acquired a large ground position in the Flin Flon–Snow Lake Belt by staking, acquiring mineral exploration licences and entering into option agreements. Each of the 12 prospective land packages has been selected for their potential to host volcanogenic massive sulphide (VMS) deposits. VMS completed a 5-hole summer drill program on 3 anomalies outlined by airborne geophysics and geochemical surveys at their Reed Lake property. In October, the company announced that assays from the second hole returned 43.05 m of 4.38% copper, 1.56% zinc plus precious metals. Holes 1 and 3 on the same VTEM target also returned encouraging base-metal values. A second phase of drilling began in November to further define the discovery.

Developing the mine portal at the Bur zinc-copper deposit near Snow Lake (Photo courtesy of HudBay Minerals, Inc.)HudBay Minerals Inc. boosted their 2007 exploration budget to $45.2 million. This included $8.5 million for the Bur copper-zinc deposit east of Snow Lake where the company is developing a decline to take a 10 000 tonne bulk sample and conduct a feasibility study.

At their Lalor Lake property southwest of Snow Lake, HudBay intersected a new zone of high-grade zinc mineralization. The initial drillhole intersected 45.13 m of 7.62% zinc and 0.19% copper along with significant precious-metal values. Drilling with up to 4 machines continued throughout the summer and fall and was returning very encouraging results. Other 2007 drill programs focused on testing geophysical anomalies, known deposits, structural re-interpretations to discover new ore bodies, and within and around operating mines. HudBay also signed option agreements on some of their Flin Flon–Snow Lake area properties with Rockcliff Resources Inc. and VMS Ventures, further leveraging their exploration opportunities.

Murgor Resources Inc. embarked on an aggressive drill program in January on properties they optioned from HudBay Minerals in 2006. Three properties, Hudvam, Wim and Snow-H, are in the Manitoba portion of the Flin Flon–Snow Lake Belt. Hudvam and Wim contain partially delineated copper-zinc deposits for which Murgor completed NI 43-101-compliant resource estimates early in 2007. A winter drill program encompassing 20 holes was completed at Hudvam and returned encouraging results. Additional drilling is planned for 2008 leading up to a feasibility study later in the year. Current inferred resources at Hudvam stands at 1.19 million tonnes of 1.17% copper, 1.71% zinc and 2.94 g/t gold. Ground geophysical surveys completed at both Hudvam and Wim have outlined new prospective targets near the deposits. Murgor commenced initial drilling at the Wim deposit in late August. The first phase of drilling of 10 holes is designed to verify historical data by duplicating drillholes and verifying the continuity of mineralization with infill holes. A more extensive drilling program to boost the resource base is planned for early 2008. The Wim deposit contains an inferred resource of 2.06 million tonnes of 1.92% copper, 0.26% zinc and 1.65% gold g/t.

Halo Resources Ltd. was conducting an extensive 30 000 m drilling campaign on their 200 km² Sherridon VMS property located 65 km northeast of Flin Flon. The property contains several known near-surface deposits and mineralized zones, as well as the past-producing Sherritt Gordon orebody. The property package is a combination of new claims, option agreements and a mineral lease. Halo conducted drilling on four of the six known deposits during 2007 including Park Lake, Bob Lake and Jungle Lake. Initial drill programs are being conducted to confirm historical results and to explore for extensions to known deposits. Drilling has been successful in confirming massive sulphide mineralization and expanding the resource base. An NI 43-101-compliant resource calculation is being conducted for the Jungle Lake deposit, after which similar compilations will be completed for the remaining deposits. Additional drilling will be carried out in 2008 to further delineate ore zones and help advance projects to compliant resource calculations.

Rockcliff Resources Inc. signed option agreements to acquire 100% interest in seven property packages from HudBay Minerals. The properties are located within the Snow Lake area and contain the Rail, Reed, Kof and Sylvia copper-zinc deposits as well as numerous other prospective volcanogenic massive sulphide targets. After acquiring the optioned properties, Rockcliff acquired three exploration licences in the Snow Lake area and later staked additional claims adjacent to the Rail Lake property. A 3000 metre drill program at the Rail deposit commenced in October, initially concentrating on locating potential extensions of the deposit. A major drill program is planned for 2008 on the company’s large property portfolio.

Cream Minerals Ltd. completed a short 2-hole drill program on their Wine property located 60 km southeast of Flin Flon. Drilling, to confirm a hole drilled by Hudson Bay Exploration and Development in 1987, intersected 20.4 m grading 1.30% nickel, 2.27% copper, 0.05% cobalt plus platinum-group element (PGE) values. A second hole drilled to test the plunge of the mineralized zone failed to intersect the intended target.

Callinan Mines Limited and partner Bell Resources Corporation completed a VTEM airborne survey and drilled high-priority targets at their Fox River nickel property east of Gillam. Drilling examined 7 separate conductive targets out of a total of 20 on the large, remote property. Drillholes intersected mafic and ultramafic intrusive rocks containing sulphide mineralized zones of varying thickness. Assay results returned low-grade nickel and copper-zinc values in two separate holes.

Callinan also completed a 5-hole drill program on the Cal property northeast of Snow Lake. The project is following up on work by a previous operator that reported intersecting a thick mineralized zone containing nickel and copper values within a peridotite host rock. Callinan’s drillholes intersected several zones of massive sulphide containing chalcopyrite within peridotite. Assay results are pending.

Pure Nickel Inc. reached an agreement with Xstrata Nickel to acquire 100% interest in two nickel properties, the William Lake project and the past-producing Manibridge mine near Wabowden. Pure Nickel also signed an option/joint venture agreement to acquire 50% interest in Xstrata’s Fox River project in northeastern Manitoba. The Fox River Belt is believed to be part of the same large-scale geological feature that hosts the Thompson and Raglan (Quebec) nickel deposits. Pure Nickel completed a 10-hole summer drill program at the Fox property which returned assay values of up 2.38% copper and 0.43% nickel. The company said the technical results of the 2007 drill program increased the understanding of the geophysics and complex geology of the Fox property, which is deeply covered by glacial deposits.

In southeastern Manitoba, a scoping study released in January on the Mustang Minerals Corp. Maskwa nickel deposit increased the total mineral resource to over 9 million tonnes enabling a 9-year mine life with initial capital costs estimated at $64.5 million. Mustang subsequently embarked on a 30-hole drill program to upgrade the reserve figure, explore for additional mineralization and assist with the preparation of a prefeasibility study. The prefeasibility study is in progress with a revised mine plan that will include an initial open-pit lasting six years followed by an estimated two-year underground operation. Targeted production is expected to be 1 million tonnes of ore per year yielding 10 million tonnes of nickel in concentrate, plus other metal credits.

Mustang has a second nickel-copper open-pit resource at the M2 zone on the Mayville property located 35 km by road from the Maskwa deposit. A mineral resource estimate released in January concluded that M2 contains indicated resources of 21.9 million tonnes of 0.20% nickel and 0.48% copper. Mustang is reviewing various methods to try and enhance the mineral potential of the M2 zone and the Mayville property. This includes exploring for new resources and/or using selective ore extraction processes.

back to top

Precious Metals

San Gold Corporation conducted an aggressive exploration and development program at the Rice Lake mine in Bissett. Development work on the 28th level (4200 ft.) and the 29th level for production of the “93” and “98” veins returned some high-grade gold values. Face sampling of the “93” vein averaged 60.27 g/t gold over a true width of 1.5 m and a strike length of 53.3 m in early development. Drilling also discovered a new high-grade vein on the 28th level which assayed 39.7 g/t across 1.2 m. In addition, drilling below the 5300 level returned some high grades, including 6.8 m of 50.1 g/t within a 15.1 m intersection of 14.6 g/t gold. In the fall, San Gold reported new high-grade zones had also been discovered from drilling on the 30th and 32nd levels. From the 30th level, a 1.5 m intersection returned 113.1 g/t gold.

The first production ore from the San Gold #1 deposit was delivered to the mill in early April and the two operating mines were rapidly increasing their ratio of higher grade production ore from initial lower grade development material. Together the two mines were contributing 725 tonnes (800 tons) of ore per day. Modifications to the mill’s crushing circuit are being considered to increase overall mill capacity for anticipated increased tonnage from San Gold #1 and the addition of ore from the Cartwright zone. The company had their first gold sale in April since putting the operation back into production in 2006 and has made the transition from developer to producer.

Rolling Rock Resources Corporation completed a 28-hole drill program at their Monument Bay project in northeastern Manitoba consisting of infill and down-plunge drilling of the main zones. Some highlights of the program include a 4.45 m interval of 10.17 g/t gold at the C zone and a 15.0 m intersection at the G zone which assayed 6.68 g/t gold. The company is highly encouraged by the down-dip extension of the G zone which remains open along strike and down-plunge. The Monument Bay project has an NI 43-101-compliant inferred resource of 3.38 million tonnes of 6.45 g/t gold.

Garson Resources Ltd. and Piper Capital Inc., joint owners of the New Britannia mine (NBM) in Snow Lake, amalgamated to form Garson Gold Corp. in April. A 10 000 m first-phase drill program began in February starting with detailed drilling of the existing inferred resources at the NBM #3 zone, which currently stand at 220 000 tonnes of 7.10 g/t gold. Drilling of deep holes encountered multiple gold-bearing intersections in some holes. By December, Garson had completed 18,000 m of drilling, primarily on the No. 3 zone. Limited drilling tested mineralization in the upper levels of the Main NBM deposit. A scoping study to assess the viability of re-opening the NBM property has begun.

Black Pearl Minerals Consolidated Inc. conducted stripping and channel sampling in preparation for taking a bulk sample at the Gold Dust zone located southeast of Snow Lake. Initial results from channel samples from ore shoots returned high-grade gold values such as 545.9 g/t across 0.4 m and 116.1 g/t over 0.8 m. Black Pearl plans to selectively stockpile up to 9000 tonnes of ore material over the winter and process it with an on-site mill in the spring of 2008.

Carlisle Goldfields Limited completed over 12 000 m of drilling at the MacLellan gold mine near Lynn Lake by mid-2007. Carlisle said that the presence of the MacLellan mine horizon has now been confirmed to the east, west and up to 200 m below the present mine workings. Many drillholes returned multiple intersections and examples of significant assay results included 9.0 m of 18.97 g/t and 5.75 m of 11.01 g/t gold. A second phase of drilling was scheduled to resume in November.

Wildcat Exploration Ltd. completed over 8000 m of drilling at their Jeep property east of Bissett in southeastern Manitoba. The drill program extended the strike length of the No.1 vein system of the former producing Jeep gold mine to 1.1 km. High-grade gold values of 56.38 g/t over 0.38 m and 36.04 g/t over 0.30 m were encountered. As well, drilling of a magnetic anomaly southeast of the Jeep shaft area returned elevated concentrations of nickel-copper and platinum group elements across significant widths.

Wildcat also conducted geological mapping, prospecting and sampling programs at the Jeep property and at the Garner Lake property where previous sampling returned high-grade gold values. Drilling at the Poundmaker property west of Bissett to investigate mobile metal ion and geophysical anomalies commenced in early November.

Puma Exploration commenced a 3000 m drill program at the Little Stull Lake gold deposit in northeastern Manitoba in June. The property was the subject of extensive drilling in the late 1980s and early 1990s by Westmin Resources Limited. At least five gold-bearing lenses were identified over a 2 km strike length. Puma’s first objective is to confirm the historical, non-compliant resource calculation completed in 1991. At that time Westmin estimated potential resources of 750 000 tonnes grading 10.3 g/t gold. Puma’s drilling results are pending release.


The search for diamonds in Manitoba continued in the Hudson Bay Lowland and Seal River areas west of Churchill. De Beers Canada Inc. completed a high-resolution airborne magnetic survey on a 20 000 km² land package at Seal River and reduced their exploration licenses to cover the anomalous areas.

Peregrine Diamonds Ltd. has several exploration licenses south of Churchill where an airborne magnetic survey has been completed on one of the properties. Planned exploration includes airborne and ground geophysical surveys and drilling as warranted.

Western Warrior Resources Inc. acquired exploration licenses south of the Nunavut border augmenting their Eppler Lake property west of Churchill. An initial diamond-drill program did not intersect kimberlite, although a number of anomalous gold and base metal analyses were returned. A further 34 diamond targets remain to be tested on their properties.


The search for uranium in Manitoba is focused on the northwest corner of the province. CanAlaska Uranium Ltd. conducted a surface sampling program on their North East Wollaston project and discovered a large number of high-grade surface uranium showings. The uranium mineralization comprises two types. One is associated with granitic and altered sedimentary rocks and many of the target zones bear similar signatures to basement-style mineralization within the Athabasca Basin. A second mineralization type is associated with phosphate altered intrusive rocks. A winter drill program is planned, pending regulatory approval.

Specialty/Industrial Minerals

Agrium Inc., a leading global producer of agricultural nutrients holds a five-year, 45 000 ha exploration permit to explore for potash in the St. Lazare area. The company has conducted preliminary seismic surveys in their permit area and is reviewing their data. Agrium has the option to convert the exploration permit to a potash mineral lease within its five-year term to facilitate mining.

BHP Billiton, the largest diversified mining company in the world, has a 51% share of the Manitoba Potash Corporation (MPC), holder of a large potash deposit in the Russell-Binscarth area. The Province of Manitoba is a joint partner with 49% in MPC. In February 2007, the Province announced that BHP will spend $15 million to explore the potential of the deposit.

Canexus Income Fund continues to produce sodium chlorate for the pulp and paper industry at its Brandon plant (formerly operated by Nexen Inc.), the world’s largest at 263 000 tonnes per year. Canexus purchases salt for the Brandon operation (the lowest-cost plant in North America) from Saskatchewan potash producers. A $50-million expansion to increase the annual production capacity of the plant by 12% to 296 000 tonnes per year will be commissioned in 2008.

Gossan Resources Limited has a high-purity dolomite property, located north of Inwood. Inferred resources of over 132 million tonnes grading 21.32% MgO (including almost 35 million tonnes of measured resources averaging 21.18% MgO) were calculated on the basis of 43 drillholes. In September 2007, Gossan announced that favourable results were received in a chemical thermodynamic study of the Zuliani process that could be used to extract 99.8% commercial-grade magnesium metal from dolomite at atmospheric pressure. Bench-scale testing is being planned. The extracted metal might be used to produce magnesium-aluminum alloy and as a structural metal in the auto industry, in die casting.

Gossan Resources completed a drill program in December 2006 on its high-purity silica sand property, on the east shore of the south basin of Lake Winnipeg. The drilling outlined the edge of two zones with thicknesses greater than 8 m and average thickneses of 11.5 m. In June 2007, two shallow test-pits were dug near the east end of the property; two new quarry leases were acquired the following month. In August 2007, an initial series of proppant tests were completed on various sized sand samples; results exceeded all minimum oil and gas industry standards for frac sand. In addition, the sand also appears to meet metallurgical standards.

Victory Nickel Inc. had planned to carry out a drill program in 2007 to test the open-pit silica sand by-product potential of its Minago nickel deposit (formerly held by Nuinsco Resources Limited) south of Thompson. In November 2006, a scoping study estimated that about 25% of the 16.2 million tonne 10 m thick Winnipeg Formation sand, overlying the nickel orebody, was of frac sand quality. Another 18% of the sand was suitable for other purposes, such as glass production and foundry sand. In December 2007, Victory Nickel projected a potential net sales revenue of $187 million based on an annual production of 517 360 tonnes of sand for 13.4 years (at an average free on board (FOB) Minago mine site price of $26.84/tonne). The sand is overlain by 53 m of limestone, which also may be used to generate by-product revenue, such as sales of road and rail construction aggregate.

back to top