Landore Resources: Finding the hidden depths of Junior Lake

Zoom in today on an aerial photograph or GoogleEarth view of the Canadian Great Lakes port of Thunder Bay, and one physical feature leaps out of the frame.

A green crescent, scythed through industrial and residential space alike, curves north-west and then east through the city from the southern rail approaches out to the historic Port Arthur dockland area.

This was the site of the Thunder Bay Iron Ore Trestle, a long ramped-earth, wood and iron structure built to carry iron ore trains from the Steep Rock Mine from ground level up a continuous gentle gradient to the top of the massive iron ore dock which, at the time, was one of the port's major features.

Four railway lines – two in and two out – ran along the top of this massive structure, bringing iron ore trains to discharge their loads into the dock's hoppers and chutes, from which gravity filled the waiting iron ore carriers. Millions of tonnes of Steep Rock ore was then carried away through the Great Lakes system to the steelmaking heartlands of North America. 

Sadly, the trestle – built in 1945 to last a hundred years – is gone, dismantled in 1993 following the exhaustion of reserves at the Steep Rock Mine. And the 400 metre long poured-concrete core of the iron ore dock, stripped of its hoppers and chutes, and stained red by decades of iron dust, stands only as an historic landmark. 

But today, once again, the shipping of iron ore on the Great Lakes is on the increase, and new iron ore mines are being developed in Thunder Bay's  hinterland – including a revival in the Steep Rock area.

Whilst the old iron ore dock will never return to glory, newer bulk materials handling and terminal facilities are available to the south of the old port area to handle the output of these new developments. 

It is these modern port facilities that could well handle the output of the proposed magnetite iron ore mine being developed by Landore Resources (LON:LND) at their Lamaune Lake/Junior Lake property in central Ontario.

It had been known since the 1960s that the area hosted significant banded iron formations (BIF), and that early work by geologists - who included well-known government geologist R V Oja – had defined a series of eight specific magnetic anomalies, and forecast a potential for one group of three such anomalies to contain  26 million tonnes of iron ore in an area 4,150 feet long by 250 feet wide and 500 feet deep.  

An airborne survey by Landore in 2004 broadly confirmed the location of these anomalies, and in 2008, following a geophysical review, a total field magnetic survey along a trend some 3.8km in length firmed up a number of areas for trenching and drilling. 

The first focus was on Oja's  historical D and E anomalies, each of which featured outcropping BIF. Trenching showed excellent results and the decision was taken to conduct exploratory drilling of D and E, along with F and G.

Results were positive, showing three parallel trends of steeply dipping BIF mineralisation from surface, demonstrating good widths of up to 78 metres with head grades averaging 30% Fe.  

This was sufficient encouragement for Landore to commission an airborne “Impulse” magnetic survey along the whole 12 km BIF trend, the results of which were highly promising and showed a number of previously unidentified magnetic anomalies indicative of magnetite iron ore.

The trenching and drilling programme which followed up this survey was focused on the 5km central portion of the trend, and featured 1,200 metres of trenching and 7,000 metres of drilling.

By the time this was complete and results had been absorbed, the project had been considerably advanced, and Landore now had a competent and highly detailed data set covering the central portion of the BIF mineralised trend. A conceptual study, carried out by independent consultants, derived from this data an exploration target of 545 million tonnes, to a depth of 300 metres, with an average head grade of 29% Fe at a cut-off grade of 20% Fe. 

Metallurgy was also tested, and Davis Tube Recovery (DTR) tests on samples of ore with an average grade of 32% produced a concentrate grading 65.5% Fe, with a mass recovery of 25% and only moderate levels of deleterious elements such as silica.  

DTR testing is a key parameter in establishing the metallurgy of a magnetite deposit, as it demonstrates clearly how much iron can be recovered from the rock by the simple process of magnetic separation alone.  

Further testing revealed that Lamaune Lake's magnetite would also benefit from a flotation process after the straightforward magnetic recovery, as this would enhance the concentrate grade to in excess of 68% Fe, whilst at the same time reducing still further the undesirable silica and enabling an overall 83% recovery of the iron contained in the original ore. 

Infill drilling is now planned for early 2011, to put some solid flesh on the conceptual bones and generate a maiden NI43-101 compliant iron ore resource by mid-year over the central 4km of the trend. In the meantime, Landore are marketing the project's potential to North American and other steel manufacturers and evaluating the logistics of exporting the resulting concentrate.

These are relatively straightforward, as the project is only 13km from the national railroad, contains abundant water supplies, and will, by 2013, have access to power via the hydro-electric powerlines which are planned to traverse the property. 

As if this new iron ore project on Landore's mineral-rich Junior Lake property weren't enough – in addition to the B4-7 polymetallic and VW nickel resources and a range of other metallic prospects – the BIF exploration trenching and drilling turned up yet another significant discovery.

Virtually every drill hole into the BIF mineralisation had also encountered gold. And as exploration progressed , enough gold was intersected for Landore to declare the Lamaune Gold prospect as a new discovery, worthy of exploration and possible development in its own right. 

First announced less than a year ago, Lamaune Gold was the driver for a significant bout of claim staking to the north of Lamaune Lake, and the Junior/Lamaune Lake property is now some 31 km long from east to west and covers some 32,000 hectares.  

The new claims are thought to contain similar Archaean greenstone structures to the existing geology of Junior Lake, which forms part of the Caribou-O-Sullivan Greenstone Belt in the Wabigoon Subprovince. Greenstone belts are highly prospective for a wide range of minerals, particularly gold.

The new Lamaune Gold prospect is focused initially in the area around drill hole 1110-67, where - during drilling of the BIF - a gold intercept of 5.88m at 2.36 g/t  with a higher grade “sweet spot” of 7.45 g/t was encountered.

Subsequent drilling in the area over some 200m of possible strike length containing a number of gold anomalies identified two zones of gold mineralisation: a wide, low grade southern zone, coupled with a narrower, higher grade zone to its north. The gold is adjacent to, but not part of, the BIF structures – a common occurrence, where mineralising fluids carrying gold and other minerals penetrate and fill the weak area where a BIF structure meets its host rock.

The broad zone has now been drilled along 500m of strike and to 200m depth, and typically generates widths of 10-20m with grades of 0.6-0.9 g/t, associated with quartz and quartz-carbonate veinlets. A high grade quartz vein has also been intersected close to the broad zone, in which visible gold has been observed, and which carries grades of up to 118.66 g/t. Further drilling is planned for 2011 simultaneous with additional drilling of the iron deposit, and in the meantime a conceptual study has generated a target in the region of 50,000 ounces of gold.

The proximity of the gold and iron is not only keeping exploration costs down by allowing simultaneous drilling, but will also be a bonus as and when the two projects are developed, as they can also be mined simultaneously. Both are close to or at surface, meaning they are open pittable with a low stripping ratio.

Gold metallurgy is simple, suggesting a heap leach operation for the low grade gold, and gravity separation for the high grade vein, both of which are low cost operations and could be brought into production relatively swiftly with low capital expenditure.

The success of the Lamaune Gold project and the current price of the yellow metal has prompted a review of the many gold occurrences elsewhere on the Junior Lake property, and exploration teams have been active during the summer months on the Toronto Lake and Grassy Pond/Felix Lake prospects with encouraging results. Both will be drilled in the forthcoming drill season.  High grade gold up to 26 g/t has also been discovered in the Whale Zone lying between the VW and B4-7 nickel deposits, some 12km east of Lamaune Gold and parallel with the existing known BAM gold zone.  

It's thought that the gold and other mineralisation which occur throughout the length of the Junior Lake property are associated with the boundary between the rocks of the Wabigoon sub-province and the adjacent English Lakes sub-province. The focus at Junior Lake has historically been on nickel and associated metals, and Landore have established two worthwhile NI43-101 resources at Junior Lake already.

However, with demand for both gold and iron ore showing no signs of coming off their current highs, the application of modern exploration techniques to the many gold occurrences running the length of the property and a search for eastward extensions of the significant BIF at the western end could pay dividends for Landore in the months and years ahead. 

An investor with a sense of humour once remarked that Bill Humphries was intent on working his way through the entire periodic table at Junior Lake, not to mention Landore's other key properties at Miminiska, where more BIF related gold is currently being drilled and Root Lake, where the re-assessment of an historic lithium resource is under way. As the prospectivity of Junior Lake continues to unfold, it seems there's many a true word spoken in jest.