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MINING

True NorTh Gems INc. [TGX-TSXV] has started open pit mining operations at the Aappaluttoq ruby and pink sapphire deposit situated on tidewater about 250 km south of the capital, Nuuk, in south-western Greenland.

“On behalf of True North Gems Inc., True North Gems Greenland A/S and all our working partners it is my great plea-sure to announce that we have broken ground at Aappaluttoq,” stated Nicholas Houghton, President and CEO. “During a very tough period for the mining indus-try with many financial challenges, it is deeply gratifying to see everyone’s hard work materialize and for True North’s shareholders to see mining start.”

LNS Greenland (LNSG), joint venture partner at the Aappaluttoq Mine, has been contracted as mine operator and is earning a 27% interest. Their Norwegian and Greenlandic based technical team have submitted mining extraction plans to the boards of True North and True North Gems Greenland A/S, and received approval for pit operations to begin.

LNSG is a highly experienced Norway-based mining company and is responsible for the production of rough gemstones at the mine facility. True North staff upgrades the concentrates into clean and fully graded gemstone sales parcels using their extensive gemological experience.

“In 2004 we reviewed some data and literature previously compiled regarding a red corundum outcrop in Greenland and subsequently planned a site visit,” said Houghton. Rubies and sapphires are variet-ies of corundum. “After setting foot on the land and examining it, we realized there was good potential for an economic deposit. In Greenland there is little overburden so we could see the geological trends, in this

case, a band of altered material that was the host rock for the corundum, consequently the source of the gems.”

In 2005, the company returned for a longer program and found gem-quality material that warranted an exploration delineation program.

“We drilled the resource upon which the Pre-Feasibility Study is based,” explained Houghton. “We extracted a bulk sample of 260 tonnes from surface. Drilling down to 120 metres in depth, we learned that the consistency and quality was there based on a gemological assays, that is, high-gem, mid-gem and commercial-gem quality in both pink sapphire and ruby.”

Houghton remarked that it wasn’t necessary to take a bigger bulk sample because that would have been full-out mining. “We did enough to confirm a resource and then went into the permit-ting stage,” he said.

Drilling and blasting a gemstone deposit is different from, say, mining cop-per or gold. “We drill a row of perforation holes and carry out a very soft blast which is more like a crack that weakens the ore-

body,” said Houghton. “You make sure the wave of percussion exits away from the orebody, which is then extracted in blocks. The orebody itself is not blasted. It’s the strip on the outside that is blasted so it becomes a quarry operation where we ‘surgically’, so to speak, remove the gem-stone-bearing material.”

Perhaps surprisingly to Southerners, work can be done year-round in Greenland. “We have only done our Pre-Feasibility Study looking at a six-month operation; however, we can operate year-round if required,” noted Houghton. “We actually constructed the mine all through the winter. They are very hardy people in Greenland who know how to work in Arctic conditions. For our joint venture partner and Arctic operator, LNS-Greenland, this is normal working conditions for them.”

The processing plant and gemstone recov-ery system is being shipped to Greenland and the planned Q4/2015-Q1/2016 extrac-tion will create a sufficient ore stockpile to feed the plant once it has been commis-sioned. Planned waste rock removal work

True North Gems mining Greenland rubies and pink sapphires

by Ellsworth Dickson

A selection of polished rubies and pink sapphires from the Aappaluttoq Mine 250 km south of Nuuk, southwestern Greenland. Photo courtesy True North Gems Inc.

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during the current extraction will pave the way for the 2016 mining season to com-mence as scheduled.

“When it comes to production, we don’t need an ice-free port to get the material out,” said Houghton. “All our processing facilities are on site so we end up with a clean first concentrate that can be trans-ported out by boat or helicopter in secured containers.”

“This is a historic day for the revived mining industry in Greenland,” stated Bent Olsvig Jensen, Managing Director of True North Gems Greenland A/S. “Being one of the first companies to progress through the new permitting system and to reach a posi-tive outcome is a testament to all involved. We now look forward to fully commission-ing the newest mine in Greenland, which will be one of the most advanced coloured gemstone mines in the world.”

True North is experimenting with pol-ishing the gemstones in China, Thailand, Sri Lanka and Canada. “Countries such

as Sri Lanka have a certain polishing style and customers that prefer it,” said Houghton. “Thailand has a different style and also has its customers as does China and India”. The company plans on marketing the rubies and pink sapphires worldwide. “I want to elevate the coloured stone sector up a few notches where I think should be,” enthused Houghton. “It has been dawdling, you might say, due to a lack of consistent supply. If you don’t have a consistent supply, you don’t get that confidence to grow. Ninety percent of the operations out there are alluvial deposits where the product is marketed sporadi-cally. We want to change that, work with our buying partners and supply gemstones consistently of various qualities from com-mercial to high.”

Houghton noted that rubies have always been in the top echelon of coloured gemstones along with emeralds and blue sapphires. “Rubies don’t form in the larger crystal form that can be found in blue

sapphires and emeralds. Therefore, large rubies can command a very high price. The bottom line is that there is a strong demand for rubies and pink sapphires.”

The dimensions of the corundum deposit offers “plenty of potential for expansion” Houghton said. “The pit we envision at present is a small one 200 by 100 metres and 70 metres deep. We know the orebody extends underneath. We will be making a decision as to go to underground mining. The trend itself is 8.3 km long and we have already found a second and third outcrop. Right now, the mine life is nine years but we should far surpass that.”

Marketing is most important, Houghton observed. “We want to maximize the value since we have a commodity that is not capped like gold or copper. I know the price can be increased with good market-ing. There is also a lot of upside to pink sapphires. People would want the colour but not the expense of a pink diamond – and that is what we have.” n