High Grade - Accessible - Growing
High grade copper-zinc rich deposit discovery with tremendous expansion potential - multiple separate zones that are all open.
Under Option/JV to Dowa Metals & Mining Co., Ltd. of Japan who has the option to earn a 49% interest in the Project by making aggregate expenditures of US$22,000,000 over a four year period.
Excellent access - located adjacent to a paved Alaska state highway, with a short (60 kilometers) haul to year-round deep-sea port facilities in Haines, Alaska, providing ready access to Asian concentrate markets.
Large property with numerous underexplored base metal prospects that define more than 15 kilometers of favorable mineral trends - hallmarks of a major (+30 Mt) massive sulphide system and opportunity for discovery of multiple deposits.
Hosted by the same Late Triassic volcanogenic massive sulphide (VMS) belt as the high-grade producing Greens Creek mine, and the giant 298 Mt Windy Craggy copper deposit - a world class environment.
Value per tonne ($$) of the 43-101 compliant resource compares favourably with the major producing Cu-Zn VMS mines of North America.-
The deposit exhibits a very good response to conventional metallurgy, with high metal recoveries produced at moderate grind sizes. Initial locked cycle flotation tests performed by SGS yielded good quality, smeltable copper and zinc concentrates.
Steep geometry of thick, continuous zones of South Wall massive sulphide coupled with the potential to access by short lateral drifts at lower elevations makes for attractive, lower cost mining should the project advance to production.
Inferred Resource Estimate - Using Net Smelter Return (NSR) Cut-off
(i) Assumed metal prices are US$2.75/lb for copper (Cu), and US$1.00/lb for zinc (Zn), US$1200/oz for gold (Au), US$18/oz for silver (Ag). NSR equals (US$45.69 x Cu% + US$11.70 x Zn% + US$25.04 x Au g/t + US$0.43 x Ag g/t). Estimated metal recoveries are 89.6% for copper, 84.9% for zinc, 75% for gold and 89.7% for silver as determined from metallurgical locked cycle flotation tests. NSR formula is based on assumed values for offsite costs, metal recovery, and metal prices. Offsite costs include transportation of concentrate, smelter treatment charges, and refining charges.
A budget of US$3.7 million has been approved by partner Dowa Metals & Mining Co., Ltd. (“Dowa”). This year’s planned program will focus on the following:
Drill program to test resource potential within a 3 km radius of existing mineral resources.
Road building to the mineral resource area, subject to receipt of permits, for enhanced safety and to support ongoing exploration and technical studies.
Environmental, geotechnical and engineering studies and evaluation of a potential exploration drift for the purpose of continued drill expansion and drill definition on the deeper portion of the existing resource.
Ongoing community engagement and environmental management of our activities.
The 2016 exploration drill program will test several targets located within a 3 km radius of the RW and South Wall Resource – an Inferred Mineral Resource of 8.1 million tonnes grading 1.41% copper, 5.25% zinc, 0.32 g/t gold and 31.7 g/t silver (see news release dated May 11, 2015). Drilling is scheduled to commence early July and will include several holes for an initial phase of 1700 meters, with opportunity for additional follow up. VMS deposits are known to occur in clusters and there is abundant potential for the Palmer Property to host additional deposits.
Dowa is in the fourth year of an Option and Joint Venture agreement in which it can earn 49% in the Project by making aggregate expenditures of US$22 million over four years. To the end of 2015, Dowa has spent approximately US$16.2 million on the Project. Dowa have indicated they intend to exercise their right to earn a 49% interest by December 31, 2016. Any unspent funds at the end of 2016 will be deposited to an account to cover initial Joint Venture cash calls.
Existing access road and laydown constructed in 2014, South Wall in distance.
Exploration work by Constantine led to the discovery in 2007/08 of massive sulphide mineralization at the South Wall and RW Zones in the Glacier Creek prospect area of the Palmer Property. Drilling to date has defined the South Wall mineralization, which includes three stratigraphically stacked massive sulphide lenses, 500 meters horizontally along strike and 650 meters vertically down dip. The RW mineralization has been defined in two separate areas, RW East and RW West, separated by 300 meters of largely untested strike potential, and has a minimum known dip length of 200 meters. South Wall and RW mineralization occupy the same general time-stratigraphic intervals on opposite limbs of a large-scale anticline. The presence of massive sulphide on both limbs of the fold indicates a sizeable massive sulphide system, and all zones intersected in drilling remain open to expansion laterally and to depth.
The maiden resource was estimated in January 2010. Following completion of the 2014 drill campaign, independent consultant James N. Gray of Advantage Geoservices Ltd. was commissioned to prepare an updated resource estimate for the RW and South Wall Zones of the Palmer project, in order to include additional high grade mineralization intersected in step-out drilling in 2010, 2013 and 2014. This update expanded the resource by 97%; the 2015 43-101 Technical Report is available here
Option/JV Agreement With Dowa
"We are pleased to have Dowa as a partner to advance and develop our flagship Palmer Project and further demonstrate its potential," Garfield MacVeigh, President and CEO.
Under the terms of an Option and Joint Venture Agreement signed February 2013, Dowa Metals & Mining Co., Ltd. of Japan ("Dowa") has the option to earn a 49% interest in the Project by making aggregate expenditures of US$22,000,000 over a four year period. Expenditures for each year shall not be less than US$3,000,000, with Dowa funding a minimum of US$3,000,000 in year one as a firm commitment. Included in the aggregate expenditure are cash payments to Constantine totalling US$1,250,000 over four years, of which US$500,000 was received upon signing of the Agreement. Constantine is Operator for work programs carried out during the earn-in period.
Location And Property Information
The Palmer Property is located in the Alaska panhandle and lies less than two kilometres from the Haines Highway, which links the deep-sea port of Haines, Alaska, a terminal of the Alaska Marine Highway system, with British Columbia, Yukon, and the Alaska Highway. The Property consists of a contiguous block of land consisting of 340 federal unpatented lode mining claims, which cover an area of approximately 6765 acres (~2738 hectares or 27 km2) and 63 state mineral claims that cover an area of approximately 9200 acres (~3680 hectares or 37 km2).
In 2014, Constantine was the successful applicant in a competitive lease process for the 'Haines Block' (MH Parcels C81209, C81210 and C70451) offered by the Alaska Mental Health Trust Authority, a state corporation within Alaska (see news release dated September 9, 2014). The Trust owns the subsurface mineral estate of the Haines Block, and for a small subset of the block, located adjacent to the Palmer property, land is held fee simple for which the Trust owns both the surface and subsurface estate. The lease was finalized and signed with an effective date of September 1, 2014, thereby consolidating a district-scale property position totaling approximately 108,000 acres, inclusive of the Palmer state and federal claims.
Excellent infrastructure including expanding hydro power capacity, road access, and port providing access to hungry Asian smelting markets
Politically stable jurisdiction with established permitting process - active hard rock mines in the region include Greens Creek and Kensington
Located in an area of active resource development; logging and placer mining within two kilometers of the Property
Geology And Expansion Potential
The Palmer Project is a volcanogenic massive sulphide (VMS) type deposit that is located within the same belt of rocks that is host to the Greens Creek and Windy Craggy VMS deposits - both widely recognized to be world class systems. For both grade and size, there is no better VMS belt to explore. As a deposit class, VMS are attractive for being polymetallic (multi-metal) and having high dollar value per tonne.
The Palmer project is located in the Alexander Terrane, with mineralization hosted within marine sedimentary and volcanic rocks of Triassic age. These rocks correlate with host rocks of the giant Windy Craggy deposit (297 million tonnes at 1.4% Cu, 0.07% Co, 0.2 g/t Au, and 3.8 g/t Ag), and the high-grade Greens Creek deposit with probable reserves of 8.24 million tons grading 12.1 opt Ag, 0.092 opt Au, 9.3% Zn and 3.5% Pb (Dec 2010) and an estimated global resource of 24.2 million tons grading 19.2 opt Ag, 0.15 opt Au, 13.9% Zn, and 5.1% Pb.
The numerous showings and prospects on the Palmer property occur along two mineralized trends over a combined strike length of at least 9 miles. Repetition of the principal mineralized horizons by folding is interpreted to account for the distribution of at least 25 separate base metal and/or barite occurrences) across the property. Recent work has established the existence of more than one stratigraphically stacked mineralized horizon.
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Notable prospect areas include Glacier Creek (South Wall and RW zones), Mount Henry Clay, Cap, Nunatak, Hanging Glacier, the Gullies, Boundary and Red Creek. The showings/occurrences are associated with interpreted exhalative horizons in a thick sequence of basalt flows with interbeds of sediments, andesite flows and tuffs and fragmental and massive rhyolites. Extensive pyrite-sericite schists and siliceous rocks provide a common link to the showings suggesting the presence of a very large extensive mineralized system.
The Glacier Creek prospect has received the most attention. Mineralization at Glacier Creek occurs on both limbs of a large-scale south-overturned anticline that is cored by a south-directed reverse fault with modest offset. Two major stratiform horizons, the RW and Main horizons, have been identified on the shallowly to moderately dipping upright limb of the anticline. Highlight drill intersections of the RW horizon include 3.79% copper and 7.24% zinc over 14.0 meters in hole CMR07-07, and 10.86% zinc, 0.13% lead, 0.23% copper, 0.13 g/t gold and 44.4 g/t silver over 5.12 meters in hole CMR06-01. Three separate, stratigraphically stacked zones (South Wall zones I, II, and III) have been identified on the steeply dipping to overturned limb of the anticline. Highlight intersections include drill hole CMR08-14 that contains an interval of 15.2 meters of 5.1% copper, 1.79% zinc, 0.29 g/t gold and 20.5 g/t silver within a larger interval of 46.4 meters of 2.92% copper and 2.98% zinc. Both the RW and South Wall zones are open down dip and along strike.
At the Mount Henry Clay (MHC) prospect, abundant high-grade baritic massive and semi-massive sulfide boulders occur near the limits of a perched or stranded glacier. The average grade of a large number of the boulders is: 19.3% zinc, 1% copper, 0.4% lead, 38.2 g/t silver, 0.22 g/t gold, and 20.6% barium. Although the source of the boulders has not been determined, the area remains attractive for discovery.
Silver-and barite-rich stratiform mineralization at the Cap prospect (134 g/t Ag over 23 m) remains virtually untested at depth and laterally, and other occurrences on the property have also yielded excellent precious-metal values (e.g., 11.84 oz/ton Ag and 0.092 oz/ton Au in a bulk sample of baritic semi-massive sulfide from Nunatak, and up to 198.9 g/t silver, 1.58 g/t gold, 14.1% zinc, 2.3% lead, and 0.36% copper from massive sulfide at the HG prospect).
Base-metal sulfides and barite were first discovered in the vicinity of the RW and South Wall Zones (Glacier Creek prospect area) in 1969 by local prospector Merrill Palmer.
Palmer staked the discoveries and continued to prospect the area in subsequent years. In the early years following discovery, exploration focused on the economic potential of barite. Tests showed the baritic material to be suitable for production of drilling mud concentrates, although none of the prospects were developed. Many of the baritic units exposed in the area are highly oxidized and leached of sulphides, a feature of major exploration significance that was not fully appreciated until recently. It was drilling down dip of these surface showings beyond the influence of oxidation that led to Constantine’s RW and South Wall discovery intersections - 38 years after the original surface discovery.
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In 1979, Anaconda Copper Company drilled the first three diamond drillholes on the Property, totaling 801 m, in the Glacier Creek Prospect area. All holes failed to intersect the main mineralized barite-base metal horizons, although one hole (GC-2) did intersect the narrow, distal expression of South Wall Zone III.
It was not until the exploration successes at Windy Craggy and Greens Creek were realized in the early 1980s that the base metal potential at Palmer was fully understood. In 1983, high-grade massive sulphide boulders up to 1.8 m (6 ft) in diameter and grading up to 33% Zn and 2.5% Cu were discovered at the toe of a small ice sheet near Mount Henry Clay. Twenty-six samples of various boulders collected by the U.S. Bureau of Mines returned an average grade of 19.3% Zn, 1.0% Cu, 0.4% Pb, 38.2 g/t Ag, 0.22 g/t Au, and 20.6% Ba, and their discovery led to four successive drill programs (Bear Creek Mining (Kennecott) 1984 and 1985; Granges Exploration Inc 1989; and Rubicon Minerals Corporation 1999, with a total of thirteen holes and 2958 m of core being drilled. None of the programs were successful in locating the source of the boulders, and the prospect remains an attractive exploration target.
In the mid to late 1980’s Newmont Exploration Ltd. pursued the precious metal potential at the Palmer Property, with particular attention being given to the Cap and Nunatak prospects. At the Cap prospect, massive pyritic barite and baritic breccia was drilled in 1988 and 1998, with the best intercept of four holes being 134 g/t Ag over 23.2 m. At the Nunatak prospect, a 91 kg (200 lb) bulk sample divided into thirteen separate samples returned an arithmetic average grade of 11.84 oz/ton Ag and 0.092 oz/ton Au.
In the early 1990s, retreating ice exposed an outcrop of massive sulphide in the Glacier Creek prospect area that became known as the Little Jarvis occurrence. Chip samples by Kennecott from the Little Jarvis occurrence yield up to 13.0% Zn, 7.0% Cu, 0.02 oz/ton Au, and 7.0 oz/ton Ag over 4.6 m (15 ft), although chip sampling at the same locality by Rubicon Minerals Corp. in 1998 yielded somewhat lower grades: 10.8 % Zn, 0. 27% Cu, 0.17 ppm (0.005 oz/ton) Au, and 44.2 ppm (1.29 oz/ton) Ag over 3.05 m (10 ft). The interpretation that the Little Jarvis occurrence was correlative with the Upper Main occurrence on the other side of the mountain to the southeast, led to Rubicon Minerals’ drill hole discovery of the RW zone in 1999. Rubicon intersected semi-massive to massive sulphide in four holes ranging from 2.5 m to 6.3 m in width and established down dip continuity of more than 200 m; however, due to deteriorating market conditions at the time Rubicon did not follow up on their initial discovery.
Constantine Metal Resources Ltd. was formed in 2006 with the purpose of exploring the Palmer property. The first of three holes drilled by Constantine in 2006 intersected 5.12 m grading 10.86% zinc and 44.4 g/t silver, and demonstrated the presence of massive sulphide 300 m east of Rubicon’s initial RW zone discovery holes.
In late 2007, Constantine intersected high-grade copper and zinc mineralization over a width of 14 meters at the RW zone (CMR07-07). The drill was then moved over 400 meters to the east, where discovery hole CMR07-09 intersected 24.2 meters of massive sulphide at what is now referred to as the South Wall zone. In 2008, Constantine followed up on the initial South Wall discovery with hole CMR08-11, which intersected 46.85 meters of massive sulphide, followed by a second 23.2 meter massive sulphide zone, followed by a third 12.59 meter massive sulphide zone. The cumulative width of the three stratigraphically ‘stacked’ zones in this drill hole is 82.64 meters.