© — Submitted photo
One of the rocks Silver Spruce Resources extracted near Thorburn Lake, showing a banded vein found on the surface as a “float” boulder. These types of veins are typical of the “hot spring” systems.
Super-heated water rising from the bowels of the Earth millions of years ago is responsible for rock an exploration company says could be a sign of valuable gold and silver deposits.
Silver Spruce Resources CEO Peter Dimmell says his company has found rock bearing as much as 330 grams of silver and up to eight grams of gold in narrow veins south of Thorburn Lake, in what’s known as the “Big Easy” zone.
The company has 12 drill holes over a 1.2-km distance, and it will take more drilling to find the main deposit, which Dimmell compares to the trunk of a tree.
The super-heated water worked its way to the surface of the Earth millions of years ago, and the lower pressure near the surface caused the water to boil. Water leaves behind minerals such as gold and silver when it boils, and over millions of years the deposits build up to become rock worth extracting from the ground.
“The trunk is the main conduit,” he says. “As they get closer to the surface they find other fractures and they come up, but what you’re looking for is the trunk. We haven’t followed that down to the trunk. What we’ve got to do is drill deeper in the system, or drill another part of the system.”
The rocks Silver Spruce Resources have found resemble gold-bearing rock from Nevada, according to Raymond Goldie, a Toronto-based mining analyst, which is unusual because the rock near Thorburn Lake is much older than the rock that usually holds these types of deposits.
Dimmell says because the veins are narrow, mining would have to be done underground, which is more expensive but less damaging on the environment than the open pit mining of places such as Voisey’s Bay.
“It depends on what you’re finding, what it’s like. I’d expect most likely it would be an underground mine. I think environmentally an underground mine is easier to sell to people because for the most part you don’t see a lot of stuff on the surface,” he says.
Dimmell says the results are promising, but more exploration needs to be done, which is expensive, requiring a partner willing to throw in $2 million to $3 million.
“The big problem is raising money,” he says. “In today’s world, it’s very difficult to raise money for mineral exploration. It’s the world economic situation. We’ve always had trouble raising money for exploration when commodity prices are down. Now this has been a very unusual situation because commodity prices remain high, but people are risk averse, and we’re a very risky business, mineral exploration.”
If Silver Spruce Resources wants to pursue the discovery, its next step is to either finance more drilling or create a joint venture with a larger mineral exploration company. If a company were willing to invest, according to Dimmell, it would raise his company’s stock and allow it to leverage more money for drilling.
“My preference is to do a joint venture with somebody who will put in $2 million or $3 million to earn 51 per cent of the property, and hopefully that will say to people that there’s a good value in this property. Our stock will rise and when it rises we can do our own financing,” he says.