TTM - Timmins Talc-Magnesite Deposit
Note: Globex has made significant progress since publishing the PEA. In particular, among many things, we have an alternate plan for the MgO which is projected to significantly reduce the capital cost, shorten the time periods to reach specific goals and eliminate project metallurgical risks. These changes are a work in progress and may be provided to potential project investors, subject to signature of a Confidentiality and Standstill Agreement.
Property Description and Location
On December 31, 2013, the property consisted of seven (7) mining claims, totalling 27 claim units, covering approximately 499 hectares in Adams and Deloro townships, and one (1) mining lease (CLM 490) of 413 hectares in size located in Deloro Township, Ontario Canada. The property also includes approximately 551 hectares of “severed” or surface-rights–only mining patents, all of which are located in the south half of Deloro Township, Porcupine Mining District, 13 km southeast of the City of Timmins, Ontario. The mineral rights are held 100% by Globex Mining Inc. Mining lease CLM 490 was received December 18, 2013 and is deemed by the Company to mark a significant milestone in its aim to bring this project to production.
Globex acquired the original 19 claims in Deloro Township by purchase in 2000 and staked or bought outright the remaining mining claims since that time. Project ownership is shared with joint venture partner Drinkard Metalox Inc. (DMI) who holds a 10% in the project while Globex Mining Enterprises holds 90% interest in the project.
Vehicular access to the claim group is provided by road from the City of Timmins via Pine Street South and subsequently the Naybob Road to kilometer post 10, at which point the Mount Joy River Road is followed eastward from there for 3 km to the Wishbone power line and then northward for 3 km along a series of seasonal trails to the centre of the property.
The area is underlain by Archean intrusive and extrusive units and sediments including large masses of altered ultramafic lithologies and at least one east trending diabase dyke. Strike directions of units are generally east-west, with near vertical dips. The magnesite-talc-quartz rock unit is exposed on surface as large areas of outcrop 3 to 6 metre above a sand plain floor.
Work in the 1940’s by Porcupine Southgate ML included the completion of 29 diamond drill holes totaling 8,108 metres of diamond drilling which focused on gold exploration. Subsequently, in 1962 Canadian Magnesite Mines Ltd carried out surface sampling and 1,209 metres of diamond drilling in 8 holes in an effort to delineate a resource of refractory magnesia mineralization. This company completed various studies and in 1974, Canadian Magnesite Mines Ltd prepared a positive preliminary feasibility study on the property with a proposed production rate of 50,000 tpy for the MgO and 16,400 tpy for the talc (ref. Preliminary. Feasibility Study prepared for Canadian Magnesite Mines Ltd on the magnesite/talc property, Timmins, Ontario, by Scrivener Engineering Ltd, Toronto, Ontario, 1974).
The property was then acquired by Pamourex and then re-staked by Royal Oak Mines Ltd in 1984-85. The latter carried out limited further diamond drilling (8 holes, totaling 591 metres) and in-situ blasting for bulk sampling (15,000 tons) purposes in the area referred to as the Pamour Pit with the objective to complete further technical and market studies aimed at the eventual production of MgO and magnesium metal. However, control of Pamour was subsequently sold to an Australian company and the property subsequently optioned to Magnesium Refractories Ltd. who worked the Pamourex/Royal Oak Mines property from 1989 to 1994.
Magnesium Refractories carried out numerous economic studies and mineral processing, engineering and financial studies including a Prefeasibility Study in 1991 with the objective of developing a magnesite-talc operation to produce magnesium oxide (MgO) and high quality talc from a deposit estimated to host a global resource of 110Mt grading 54% magnesite (MgCo3), 28% talc, 16% qtz and 3% iron oxides (ref: Magnesium Refractories Ltd, Pre-Feasibility Report, R.A. Elliot, April,1991). This resource estimate is non NI 43-101 compliant and as such, the validity of this estimate cannot be relied upon. In 1999, Pentland Firth Ventures, completed 2 shallow close spaced diamond drill holes totaling 151 metres on the “Deloro Magnesite Deposit” where they report intersecting “magnesite altered ultramafic intrusive rock”. Subsequent to Royal Oak Mines Inc. going into receivership, Globex purchased the Deloro Magnesite Property in 2000.
Test work by previous owners of the property attempted to produce magnesium refractories by conventional processes available at that time. For the most part, this test work showed that magnesium products could be generated from this deposit, albeit with elevated iron contents that are not necessarily desirable under all market conditions.
The reader is referred to Globex’s 2012 Annual Information Form for details regarding the company’s exploration activities spanning the period 2000 to 2008 inclusively.
In 2009 and 2010, Globex carried out geological mapping on the Deloro portion of the claim block in conjunction with induced polarization and resistivity survey work as well as a ground magnetometer survey. Other aspects of the on-going metallurgy/process engineering study consisted of continuing base line studies regarding environmental/community/First Nations issues. Micon International Ltd. completed a NI 43-101 compliant initial mineral resources estimate (Ref. Globex internal report by Micon International Ltd, R. Pressacco, D. Hall and P. Ling, February 24, 2010) on the A Zone as detailed below. The following was calculated using diamond drilling information from surface down to 100 metres. At the time of this appraisal, the A Zone was known to be open to depth and along strike in addition to other known magnesite zones on the property.
The following resource tonnages and grades from the Micon NI 43-101 report are all within a limited portion of the A Zone:
Mineral Resource Estimate
Note: Additional information is available in the press release dated March 2, 2010 and in the complete report which was filed on www.Sedar.com on the same date.
The resource is open both along strike to the west and east where it is exposed on surface as well as to depth.
A micro-pilot plant study was completed at DMI to confirm engineering criteria for the production of high-grade magnesia. This program used tailings material generated from the pilot plant talc flotation study.
a) Jacobs Minerals Canada Inc. was retained to design and engineer a preliminary plant layout that would treat the primary material and produce high-grade talc and magnesia. Mineral industry consultants Micon International Ltd, were originally tasked to deliver a Pre-Feasibility study (PFS) in 2011, but were subsequently directed by Globex to convert the PFS study into a Preliminary Economic Assessment (PEA).
b) Contractor Blue Heron Environmental continued with their base line environmental studies while Golder Associates Ltd was retained to study waste stream storage requirements and to issue a conceptual pit slope design.
c) Globex increased the size of the project by staking an additional 448 hectares thereby more than doubling the original property size by an expansion to the west and south of the original property perimeter. Globex also presented an application to the provincial government to bring part of the property claims group in Deloro Township to lease.
In 2012, the newly acquired western claims in Deloro and Adams townships underwent preliminary exploration work consisting of line cutting, 29.7 kilometers of a combined ground magnetometer and VLF-EM survey by Larder Geophysics and subsequently, geological mapping by Globex personnel. Work on the talc-magnesite “A Zone” consisted of investigating an alternative talc processing method of the carbonate ore. Globex, as part of its provincial leasing application in Deloro Township, bought by outright sale from the City of Timmins, 12 “surface-rights-only” (SRO) patents totalling about 167 hectares (412.5 acres), thereby increasing the area of severed SRO mining patents to about 551 hectares.
Micon International Ltd. completed a preliminary economic assessment of the Timmins talc-magnesite deposit. This PEA, as detailed in a press release dated March 2, 2012, indicates a positive after-tax NPV of $258 M at a discount rate of 8%, an after-tax internal rate of return (IRR) of approximately 20% and a payback period of 5.8 years on the discount cash flow. This technical report is posted on SEDAR (www.sedar.com). The results of the PEA support the conclusion that further work is justified on the project, with an ultimate objective of completing a Feasibility Study. To this end, an infill-surface drilling program of 6,900 metres of diamond drilling to update the known resource calculation, was initiated in December using Timmins based contractor Major Drilling Group International Inc.
Exploration and Development
The aforementioned drill program which started at year end 2012, continued into January, 2013 and was completed by the end of March, 2013. This program was ultimately comprised of a total of 7,543 metres of drilling in fifty three (53) bore holes consisting of fifty one (51) new bore holes and the extension of two (2) existing Globex bore holes. Within this drill program, seven (7) of the holes totaling 1,178 metres were utilized as part of a geotechnical investigation carried out by Golder Associates. These holes were also logged by Globex personnel but were not sampled.
In 2013, a talc variability study was initiated in which a total of 35 samples of quartered core, representing 1,680 linear metres of drilling in mineralized material, were collected to cover the extent of the A Zone. Individual sample lengths ranged from 26 to 70 metres (average length of 48m) based on an initial nominal collection target of 60m of representative talc-magnesite for that particular target depth. The talc variability study looked to establish potential variations in the chemical and physical quality of the high-grade talc flotation and to determine from ore composites, the projected steady-state final talc concentrate grade and recovery factors from locked cycle testing that can serve to update the forth-coming PFS economic model. Proposals were received from four establishments. CTMP in Thetford Mines was selected on the basis of cost competitiveness, specific research facilities and their demonstrated experience to undertake talc quality determinations. SGS-Lakefield and Activation Laboratories provided Qemscan mineralogical and chemical analyses. The test work program to produce talc flotation concentrate samples for quality measurements was completed in mid-2013 including talc product micronization and preliminary brightness measurements. Completion of an expanded CTMP mandate including locked cycle tests, Bond Work Index determination and an amended full range of talc physical quality assessments of compounded talc-polypropylene formulations in the adjoining plastics research laboratory have been delayed pending continuing project funding arrangements. This latter study is anticipated to be completed in 2014. Additionally, in 2014, and pending financing, Globex is looking to a) finalize the talc plant design and talc variability testing, b) publish the Pre-feasibility Study, and c) seek the approval to build a small-scale commercial talc plant.
Globex thus owns a large open pittable magnesite-talc-quartz deposit situated only 13 km from the major mining centre, Timmins, Ontario that offers exceptional infrastructure for mining: roads, electrical power, natural gas, skilled labour and railway shipping service. Testing to date shows it will be possible to produce both a commercial grade talc product with no impurity issues and a high-grade magnesia product.
April 16, 2012 : A Preliminary Economic Assessment for the Timmins Talc-Magnesite Deposit, Timmins, Ontario CANADA
Prepared by B. Terrence Hennessey, P.Geo., J. Spooner, P.Geo., C. Jacobs, C.Eng., MIMMM, D. Anderson, MMSA, T. Hayes, P.Eng., D.Hall, P.Eng., L. Castro, P.Eng., K. Bocking, P.Eng.