With Australian partner, North Arrow plans 2021 exploration season at Nunavut diamond property
“We came up with this solution which makes sense for both companies”
No on-the-ground exploration will take place this summer at North Arrow Minerals Inc.’s diamond property near Naujaat due to the COVID-19 pandemic.
But the company said this week that it has entered into an option agreement with Australian-owned EHR Resources Ltd. for more evaluation of the Q1-4 diamond deposit at the Naujaat Diamond Project in 2021.
North Arrow presently maintains a 100 per cent interest in the project, including the Q1-4 deposit, which is located only nine kilometres from Naujaat.
Under the terms of the option agreement, EHR can earn a 40 per cent interest in the Naujaat project by investing $5.6 million to collect a 1,500-to-2,000-tonne preliminary bulk sample during the 2021 summer field season.
“We’ve been talking with EHR for a while and originally we were discussing a plan to see the program completed this summer,” said Ken Armstrong, president and CEO of North Arrow, to Nunatsiaq News. “However, in early March when Nunavut closed its borders, it was pretty clear that the field season was effectively lost for this project as it is based right in the community.
“So we came up with this solution which makes sense for both companies and in some ways makes lemonade out of lemons by allowing us to position sampling materials by sealift this summer at a much, much lower cost than flying it in, and ensuring the program can start on time next summer.”
As part of the agreement, EHR has posted a $300,000 non-refundable advance to be used by North Arrow to get fuel and other supplies to the site by sealift in 2020.
In order to proceed with the option and the 2021 bulk sample program, EHR must, by April 2021, have sufficient financing to fund the remaining $5.3 million.
EHR also recently acquired Nanuk Diamonds Inc., which has 254 square kilometres of mineral claims near Ungava Bay in northern Quebec.
By taking advantage of the 2020 annual summer sealift to Naujaat, the bulk sample program at North Arrow will be able to start in June 2021.
“With the hamlet’s consent, we’d look to visit the community to explain our plans for 2021, but for now we will communicate remotely,” Armstrong said.