Qubec: A Tour of Today’s Most Important Projects

Agnico-Eagle Mines Ltd.’s Goldex gold project is the most advanced project in the Val-d’Or area. The initial discovery on the property was made in 1963. A 796-m deep shaft was sunk in the late 1980s after the discovery of the Goldex Extension Zone. Agnico-Eagle finished rehabilitating the shaft this summer. This $5.8-million program also includes a bulk sample from three vertical slot raises and additional diamond drilling and metallurgical testing. A feasibility study will be undertaken in 2005. Proven and probable reserves as of February 2004 contained

1.6 million oz gold, with an inferred mineral resource of 0.2 million oz gold. The estimated cost to bring the mine to production at 10,000 tonnes/day and make a preconcentrate is $100 million, and the operation would employ 100-125 people.

Near Rouyn-Noranda is Agnico-Eagle’s Lapa gold project. Agnico-Eagle optioned the project from Breakwater in 2002. The new owner has extended the high-grade Contact zone to 1,200-m depth, and discovered a parallel South Contact zone. The company has budgeted $2.3 million for 35,000 m of drilling to extend the two zones. Probable reserves at Lapa are 4.6 million tons at a grade of 0.25 oz/ton or 1.2 million oz of gold. There is an additional 0.2 million oz of gold classified as resources. The engineering and shaft-sinking contract has been awarded and surface mobilization has begun for a 2,700-foot shaft, which may later be continued to a 4,500-foot depth. This will be completed the first half of 2006, providing access for underground exploration and sampling. Capital expenses after the bulk sample are estimated at $80 million, for a mine that would produce up to 125,000 oz gold/year over an eight-year life.

Cambior Inc.’s Westwood gold project, 2.5 km east of the Doyon mine, north of Lapa, is also looking promising. The company has budgeted $6 million over three years on the project. Deep drilling begun in November 2002 was completed in September 2004. The program has identified a major system of alteration and mineralization associated with two mineralized corridors, the Westwood horizon and North Corridor. The company has announced plans to drive a 2.6-km-long exploration drift from the Doyon mine (900-m depth), to be complete in early 2007. All data are being reviewed, and a final interpretation will be completed before the end of this year.

Another important project is the reopening of Breakwater Resources Ltd.’s Langlois zinc-copper mine near Lebel-sur-Quevillon. The massive sulphide mine shut down in 2000 due to low zinc price, but it is being re-examined. In the second quarter of 2004, work included detailed design of new material-handling systems, detailed mine planning of Zone 97, redesigning the paste-fill distribution, updating the power distribution for the mine, equipment repair and stope design for Zones 3 and 4. It would take 18 months to restart the mine and concentrator by 2006. Current reserves in the main orebody, S97, are 3.3 million tonnes grading 10.8% Zn, 0.8% Cu, 52 g/t Ag and 0.1 g/t Au. The facility would employ about 100 people.

There is an important gold potential in the Chibougamau area. For many years people searched mainly for copper in the Chibougamau camp, and less so for gold. This gold potential has attracted new companies in the region, such as Novawest Resources Inc., Ressources d’Arianne inc. and Typhoon Exploration Inc. Inmet Mining Corp.’s Troilus operation, located 175 km north of Chibougamau, produces approximately 165,000 oz of gold and 6,000 tons of copper annually from an open pit operation. The company announced in March of last year that gold reserves at the Troilus mine have increased to over 1.0 million recoverable ounces. It has almost doubled the previous reserves, extending the mine life up to 2010. The increase in reserves is the result of significant operational improvements, including an $18.5-million mill expansion project, as well as additional in-fill drilling in the new J4 open pit.

The reopening of the Copper Rand mine by Campbell Resources Inc., targeted for December 2004, will require a $54-million investment. Closed in October 1997, the mining of new ore zones involves deepening of the shaft and driving a 4,000-foot ramp decline to the 4730 level, in order to access a minimum of 2 million tonnes over a five-year mine plan.

A very important project in the Near North is the diamond exploration by Ashton Mining of Canada Inc./SOQUEM in the Otish Mountains. This year $18 million will be spent on three huge areas, with Foxtrot being the most advanced. The partners have collected 627 tonnes of material from the Renard 2, 3, 4 and 65 kimberlite bodies this year from conventional diamond drilling and 30-inch-diameter RC holes, and most is awaiting analysis. Renard 2 and 3 have the highest diamond content in the Renard cluster. A diamond valuation is planned for early 2005, of the 300 carats of diamonds that are anticipated from the program. Many other companies are involved in the search for diamonds in the Otish Mountains region, such as Majescor Resources Inc. in partnership with Stornoway Diamond Corp. on the Portage project, Diadem Resources Ltd., Ditem Explorations Inc. and Dios Exploration Inc. in joint venture with De Beers Canada Exploration Inc. on the 33 Carats project.

Also in the Near North, in the James Bay Territory, Virginia Gold Mines Inc. has confirmed by drilling its recent Roberto Zone high-grade gold discovery, in the lonore project. Many intersections returned values up to 18.85 g/t Au over a true width of 3 to 16 m. The mineralized zone has been followed over a strike length of nearly 300 m, and down to a depth of 125 m. The zone remains open in all directions. These new impressive gold intercepts have already generated important claim acquisitions in the vicinity of the lonore project by Azimuth Exploration Inc. and Sirios Resources Inc.

In the Far North is the Tootoo Ni-Cu-PGE zone of massive and disseminated sulphides, in the Raglan area (15 km south of Falconbridge Ltd.’s Raglan Ni-Cu-PGE mine). The deposit was found in 2002 on the Expo Ungava property that Canadian Royalties Inc. has optioned from Ungava Minerals Corp. The best intersection from the 2003 drill program was 5.5 m (within a 24-m-thick sulphide zone) grading 3.02% Ni, 2.81% Cu, 0.14% Co, 0.49 g/t Pt and 10.30 g/t Pd. More than 15 companies are actively exploring in the area.

There are three interesting projects that may open up new markets for Quebec dimension stone. NAMCA Inc. (a joint venture including SOQUEM) has located five areas of interest for labradorite/ anorthosite deposits in the Lac Saint Jean region. Lacroix and Sons Granite carried out advanced exploration this summer on a blue iridescent anorthosite deposit 100 km north of Montreal. The homogeneous grain size makes this stone suitable for flooring.

Both companies are trying to market their stone worldwide. In the Eastern Townships northeast of La Tuque, GRANITSLAB INTERNATIONAL INC. is sampling a fine-grained black gabbro, which should have a high value and be useful as monument stone.