Since being spun-out of Mountain Province Diamonds Inc. in the summer of 2012, Kennady Diamonds Inc. has had a singular focus - find a next-generation Northwest Territories diamond mine at its Kennady North diamond project located 280 kilometers (174 miles) northeast of Yellowknife.

Receiving a highly prospective diamond property enveloping three sides of the Gahcho Kué diamond mine project and C$3 million in seed money in exchange for slightly more than 16 million common shares, Kennady Diamonds was off to a good start in meeting its goal.

"Kennady North is an exceptionally prospective diamond exploration project, located adjacent to the Gahcho Kué JV between De Beers Canada and Mountain Province Diamonds," Kennady Diamonds President and CEO Patrick Evans explained at the time of the start-up. "Our priority is to define a resource along the Kelvin-Faraday kimberlite corridor which hosts three diamondiferous kimberlites."

Two years later, the company has set a higher bar for this primary objective.

"Our vision is to define a Kelvin-Faraday resource of between 5 and 8 million tonnes (metric tons) with a grade of greater than 2 carats per tonne. We expect to be able to declare our maiden resource by the end of 2014," Evans said at the on-set of the 2014 summer drill program at Kennady North.

Confirming the potential

As the calendar turned to 2014, Kennady Diamonds was preparing for an upcoming 10,172-meter winter-spring drill program at Kennady North, a property that envelops the south, west and north of Gahcho Kué, a diamond project being developed by De Beers and Mountain Province Diamonds.

The winter program, which got started by the end of February, saw three drills focused on delineation and exploration drilling and a larger diameter rig collecting bulk samples from the Kelvin and Faraday kimberlites.

Kennady said the delineation drilling was successful in both confirming the resource model and adding to the potential tonnage at these kimberlites.

"Besides achieving our targets for both meters drilled and metric tons of kimberlite recovered, we are particular pleased with the results from delineation drilling at both the Kelvin and Faraday kimberlites.

Kelvin delineation drill hole KDI-14-018 intersected kimberlite over 80 meters, with substantially all of the kimberlite to the north and beyond the current geological model.

Also, delineation drilling at Faraday 3 resulted in the discovery of a kimberlite 'blow' with intercepts ranging up to 42 meters." Evans said upon conclusion of the spring exploration program.

"These discoveries confirm the potential for substantial additional tonnage at the Kelvin and Faraday kimberlites, both of which have already returned exceptionally high sample grades."

The bulk sample portion of the early season program collected roughly 25 metric tons of kimberlite from Kelvin and another metric ton from Faraday. Both samples were shipped to the Saskatchewan Research Council for processing.

The 933-kilogram sample collected at Faraday yielded 4.76 carats of diamonds, or about 5.1 carats per metric ton. Of the diamonds recovered, 97 were larger than 0.85 millimeters, making them commercial grade. Besides the sample grade, Kennady said almost all the commercial size diamonds are described as transparent and either white-colorless or off-white. Approximately 75 percent have either no or only minor inclusions.

Results from the Kelvin bulk sample is expected before the end of 2014.

Raising the bar

With the goal of publishing a maiden resource by the end of the year, Kennady resumed its 2014 bulk sampling and delineation drilling at Kelvin and Faraday with a 5,000-meter summer program. Encouraging early returns from this drilling, however, caused the company to raise the bar on the scope of both its summer program and potential size of the resource being delineated.

"Delineation drilling at the north lobe of the Kelvin kimberlite pipe is exceeding expectations and initial exploration drilling at the Kelvin dyke is returning promising kimberlite intersects. Based on the results to date, we have revised our tonnage estimate for the Kelvin-Faraday kimberlite corridor from the previous 5 to 8 million tonnes to 7 to 10 million tonnes."

This declaration came on the heels of completing one hole that cut 183 meters of kimberlite outside of the geological model for Kelvin and a second that hit the Kelvin kimberlite pipe shallower than expected.

Further expansion to the north has given the company reason to believe the Kelvin-Faraday kimberlite corridor may be even larger than the 7 to 10 million metric tons.

Adding to the excitement of the 2014 summer program, a high-quality 0.94 carat diamond was spotted while core from the Kelvin kimberlite was being logged. The diamond measures 7.0 by 4.5 by 3.5 millimeters and is described as white-colorless, transparent, octahedral, distorted, twin with etched trigons. The diamond, which has no inclusions, was found at a break in the core from drill hole KDI-HQ14-030a at a depth of roughly 75 meters.

As drilling increased the breadth of the Kelvin kimberlite, Kennady increased the scope of the summer drill program. By mid-October, the company had more than tripled the drilling to 18,000 meters.

Kennady North also increased its summer Kelvin kimberlite bulk sample program to roughly 30 metric tons. This sample will add to the 25 metric tons collected early in 2014.

Given its explorations success thus far, Kennady plans to continue drilling into the winter months.

"We're now planning to build a 30 person camp at Kelvin so that we can continue drilling through the winter," explains Evans.

A C$5 million private placement financing to fund the extended program was completed on Oct. 1.

In addition to Kelvin and Faraday, the company is eager to drill a number of exploration targets at Kennady North, including the MZ and Doyle kimberlites. Getting to these outlying prospects, however, will have to wait until the Kelvin kimberlite is fully outlined.

"I'm hoping we'll be able to get to the other exploration targets this year, but we'll have to wait and see how it goes," Evans told Mining News on Oct. 1.

A maiden resource for Kennady North, originally slated for completion by the end of 2014, but with drills still seeking the full extent of the Kelvin kimberlite into the third quarter the estimate will likely not be ready until early in 2015.

Author Bio

Shane Lasley, Publisher

Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.

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