Donner Metals Making Progress in Matagami
By Our Canadian Correspondent
It has been about nine months since we reported that Canadian and Frankfurt listed Donner Metals and partner Xstrata had made a new discovery in the historic Matagami mining camp of northern Quebec. Well the drill results continue to roll in and while the grades are compelling, potential shareholders are still sitting back awaiting that break through hole that will propel Donner’s share price higher. Despite tagging nice numbers in one of Canada’s most prolific volcanogenic massive sulphide mining districts that comes equipped with well established infrastructure including a railway, a paved road, and Xstrata Zinc’s 2,600 tonne per day mill, investors appear hesitant to buy into the story despite the depth of the intercepts and potential size of the zones.
Donner recently reported that three holes cut massive sulphide mineralization in the Bracemac area and three holes cut the same about 1 km to the southeast at the McLeod area in two separate zones spaced 225 metres apart. At Bracemac the results included one hole that returned 16.88% zinc, 0.84% copper and 26.69 g/t silver over 13.55 metres and at McLeod one hole hit 9.62% zinc, 1.33% copper and 9.96 g/t silver over 32.22 metres. These grades are nice indeed but they start at 292 metres downhole at Bracemac and 845 metres downhole at McLeod.
Of note, the McLeod intercept is situated 225 metres directly down dip from the Old McLeod zone at a vertical depth of 500 metres. A connection between the two zones has not been determined but mineralization has been intersected between the two zones in two widely spaced drill holes, yielding 35.6% zinc and 1.82% copper over 0.96 metre and 15.06% zinc and 0.99% copper over 7 metres. In other words, the potential for significant expansion surely does exist and while grade makes up for a multitude of sins, it will be up to Donner to outline significant size to warrant underground development.
With multiple rigs turning the progress towards outlining a significant zone of mineralization has been solid. Donner also has time to build up the story because under its deal with Xstrata, Donner can earn a 50 per cent participating joint venture interest in the project by spending C$20 to C$23 million on or before May 31, 2011.
Donner’s chief executive Harvey Keats and vice presi ent of exploration Robin Adair have also re-launched exploration efforts on the South Voisey’s Bay project in Labrador. In joint venture with Commander Resources, the first step is a geophysical survey of the entire project that hosts the Pants Lake gabbro complex, home to the most anomalous nickel-copper sulphide mineralization in mafic plutonic rocks in Labrador outside of the gigantic 150 million tonne Voisey's Bay deposit, 90 km to the north.
The South Voiseys claims have been maintained since the Voisey's Bay discovery in the mid-1990's. The Pants Lake complex is characterized by an extensive basal contact zone that locally contains significant concentrations of nickel and copper. In a 2000 publication, Provincial Government geologists describe sulphide mineralization in the contact zone as "texturally and mineralogically similar to those at Voisey's Bay".
Another factor going for Donner is its roughly 20 per cent interest in Knight Resources, which in partnership with Anglo American, is actively drilling its West Raglan project in northern Quebec. Assay results from this project are expected any day now.
So Donner has exposure to some of Canada’s most compelling geological areas: namely the Matagami, Voiseys Bay and Raglan. The Matagami hosts 18 known VMS deposits, including 10 past producers of varying sizes, including the giant Matagami Lake Deposit (25.64 million tonnes of 8.2% zinc, 0.56% copper, 20.91 g/t silver and 0.41 g/t gold) discovered in 1957 and mined from 1963 to 1988. The Perseverance deposit some 10 Km from Donner's project is set for production in the third quarter of 2008 and hosts an indicated and measured resource of 5.12 million tonnes grading 15.82% zinc, 1.24% copper, 29 g/t silver and 0.38 g/t gold. Meanwhile, Voisey’s Bay and Raglan both host robust, self-named cash generating operations that are the envy of mining companies.
While Voiseys Bay and Raglan offer shareholders potential up side, it is the drilling at Matagami that will dictate the share price of Donner. If Harvey and his team keep tabling the type of grades over the types of widths tallied so far, it is only a matter of time before investors give them some respect.
http://www.minesite.com/nc/minews/singlenews/...ss-in-matagami/1.html
http://www.stockhouse.com/bullboards/viewmessage.asp?no=16960039&t=0&all=0
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