Juniors seek PGE, base metal deposits

With analysts forecasting improved prices, earnings and cash flows for platinum group and base metals producers in 2011, more juniors are searching for these minerals in northern Canada.

Prophecy Platinum Corp. reported results of a NI 43-101-compliant report and mineral resource estimate in mid-July for its Wellgreen Platinum group element-nickel-copper property located about 35 kilometers (22 miles) northwest of Burwash Landing in southwestern Yukon Territory.

Caribou Copper Resources Ltd. and Alix Resources Corp. July 20 said they increased the size of their Vault and Corky properties adjacent to the Wellgreen Project.

In Nunavut, Starfield Resources Inc. July 20 reported the start of drilling in its 2011 exploration program at its Ferguson Lake nickel-copper-cobalt-platinum-palladium property that is expected to continue until early September.

Rich resource at Wellgreen

The independent study, prepared for Prophecy by Todd McCracken, P.Geo. of Wardrop Engineering Inc., a Tetra Tech Co., incorporated drill data from 182 surface and 519 underground diamond drill holes, totaling 53,222 meters.

The Wellgreen deposit is estimated to contain indicated resources of 14.3 million metric tons averaging 0.99 g/t platinum, 0.74 g/t palladium, 0.52 g/t gold, 0.69 percent nickel, and 0.69 percent copper and inferred resources of 289.2 million metric tons averaging 0.53 grams per metric ton platinum, 0.42 g/t palladium, 0.23 g/t gold, 0.38 percent nickel and 0.35 percent copper

In all, the Wellgreen deposit is estimated to contain 5.39 million ounces of platinum, 4.25 million oz of palladium, 2.38 million oz of gold, 2.64 billion pounds of nickel, 2.43 billion lbs of copper and 207.07 million lbs of cobalt.

"This initial independent resource report confirms Wellgreen as one of the largest platinum group metals projects in Canada, and one of few outside of South Africa's Bushveld complex. We intend to aggressively expand total resource at Wellgreen in Yukon, Canada," Prophecy Platinum Chairman John Lee said in a statement.

Lee said Prophecy Platinum believes the 0.4 percent nickel-equivalent cut-off used in estimating Wellgreen's resource represents a conservative cut-off value with a demonstrated nickel-equivalent value of 0.74 percent for the inferred resource and 1.36 percent nickel-equivalent for the indicated resource. Additional payable metals such as rhodium, iridium, osmium and ruthenium are not figured into the current resource estimate.

Wellgreen was discovered in 1952 and historical production was focused on the massive sulfide mineralization on the property. Recent exploration has concentrated the larger, lower grade, tonnages of PGM-enriched nickel-copper mineralization at Wellgreen.

The ongoing 2011 diamond drill program announced by Prophecy Platinum June 2 is designed to augment this reported resource in recognition of the significant tonnage that was overlooked by previous operators on the property. Two diamond rigs have been operating on the property since May, with drill results expected this summer.

Amassing nearby claims

Caribou Copper and Alix Resources said it staked a total of 228 additional Yukon claims, six of which cover most of the 500 meters between the companies' Vault property and the Wellgreen Project. The balance of claims adjoin Strategic Metals Ltd.'s "Burwash" claims and greatly increase Caribou and Alix's exposure to the area, the companies said.

Alix obtained the Vault and Corky properties as part of a five-property Yukon portfolio from Strategic Metals Ltd. in an option agreement in which Alix can obtain 100 percent of the five properties by issuing 9.9 percent of its outstanding share capital to Strategic and making cumulative cash payments totaling C$3 million over a four-year period. In May, Caribou entered into an agreement with Alix whereby 49 percent interest in the five properties can be obtained by issuing 500,000 common shares and spending C$600,000 on the properties over two years. Caribou also shares its proportionate amount of the underlying agreement with Strategic Metals Ltd. on the five properties.

Advancing Nunavut deposit

Starfield undertook a limited surface reconnaissance program and drilled six core holes totaling 1,126 meters in August and September 2010. Assays revealed anomalous zinc, copper and nickel values in narrow intervals on the property. About 750 kilograms of Ferguson Lake massive sulphides were shipped to a laboratory in Ontario for testing.

Starfield's exploration plan for 2011 consists of drilling three deep core holes stepping out from the western boundary of the main deposit, where there are indications that the mineral occurrence continues to the west and at depth. The junior also plans to ship 2-6 metric tons of massive sulphides to its a hydromet pilot plant where the junior is demonstrating the processing of massive sulphide material from Ferguson Lake using commercially available equipment.

In May 2011, Starfield reported positive test results and advanced the project further by hiring SGS Lakefield to build and operate the mini-pilot plant at its facilities.

The technology aims to recover base metals in an environmentally friendly, cost-effective and energy-efficient manner, Starfield said.

Starfield President and CEO André J. Douchane told the company's shareholders recently that the overall efficiency of the oxidation and hydrolysis circuits in the hydromet process now approaches 100 percent.

Starfield also hired Roscoe Postle to update its 2008 scoping study to incorporate development activities at the project and current market conditions. The revised document is expected this summer.