VANCOUVER — Fjordland Exploration (TSXV: FEX) is raising funds to fuel an exploration program with 85% joint-venture partner Commander Resources (TSXV: CMD) at the South Voisey’s Bay nickel-copper-cobalt project in northern Labrador.
The $1.2 million, non-brokered private placement is being issued at 13¢ per flow-through unit and 10¢ per non-flow-through. Each unit consists of one share of Fjordland and one half warrant, exercisable within 18 months at 20¢ per share.
Almost half of the proceeds would be used to drill an untested, 800-metre-wide electromagnetic (EM) geophysical anomaly, plus four vertical conductors at the project’s Sandy target. The anomalies are largely hosted within the Pants Lake gabbro, an intrusive complex identical to the one that hosts Vale’s (NYSE: VALE) world-class Voisey’s Bay nickel-copper-cobalt mine, 85 km north.
The 1994 discovery of Voisey’s Bay has been heralded as one of the biggest discoveries made in Canada in the last 30 years. It triggered an exploration frenzy in the region that ensued until 2002, when targets were left dangling in an economic downturn.
Despite their efforts, explorers never uncovered another Voisey’s Bay, and Robert Cameron, president and CEO of Commander, says he knows why.
“They were looking for things they didn’t fully understand. We thought these magmatic-style deposits were easy to target — you drill a geophysical conductor and you should find a deposit. But they’re far more complex than conventional wisdom suggests,” he says.
Cameron adds that Fjordland and Commander have fine-tuned their targeting with a decade’s worth of academic research, advances in geophysics and the knowledge gained from mining Voisey’s Bay.
The companies also enjoy over $20-million worth of historical exploration data from across the 76.4 sq. km property.
“Over the years, Commander collected and compiled a large regional dataset through activities with partners and acquisitions. No one has ever compiled a dataset quite like this. When we combine our data with the new knowledge we have about Voisey’s Bay, it’s clear where the opportunities are,” he says.
To increase the odds of discovery, Fjordland recently hired consultant Brian Bengert, Vale’s former senior geophysicist for Voisey’s Bay, to help interpret and reprocess the geophysical datasets.
Fjordland also appointed Dawn Evans-Lamswood — a Voisey’s Bay expert who was the former brownfields project manager for Vale, and worked on the project since its discovery — as project manager for the upcoming drill program.
The program would test whether Sandy’s cluster of untested EM targets are signalling pools of massive sulphides within feeder dikes or magma chambers, typical of magmatic-style deposits.
“The original discovery at Voisey’s Bay was in the feeder dikes. As the magma flows through the feeder dikes it deposits nickel sulphide in embayments and bends. The magma then disgorges into the magma chambers, forming even bigger orebodies, like you see at Eastern Deeps,” Cameron says.
The geophysical anomalies have been reviewed by consulting geophysicists, who say their response amplitudes are a lot like UTEM data observed at Voisey’s Bay.
“Voisey’s Bay is a collection of deposits, either one can be small or large. So when you’re homing in on an area, you’re looking for clusters of anomalies, rather than just individual ones.”
Other targets on the property, including the Sarah and South Gabbro, are being reviewed by Fjordland’s technical team, in light of the newly catalogued historical data.
On June 5, Fjordland and Commander renewed their option agreement, whereby Fjordland can earn another 85% interest in Voisey’s Bay South for $290,000 cash, $4.5 million shares and $8 million in exploration expenses. Commander, a prospect generator, would keep a 2% net smelter return royalty on the project.
Commander shares have traded in a 52-week range of 4¢ to 8¢, and closed at 4¢ at press time. The company has 115.3 million shares outstanding for a $4.6-million market capitalization.
Fjordland shares have traded in a 52-week range of 11¢ to 80¢, and last closed at 11¢. The company has 21 million shares outstanding for a $2.3-million market cap.