To geologists, Voisey Bay ore didn't appear to be worth a plug nickel. Then, two diamond hunters hit a mineral mother lode
By Chris Flanagan
IF IT WEREN'T FOR THE FINELY HONED instincts of Al Chislett and Chris Verbiski, two old-school prospectors with a passion for rock, a mineral treasure currently estimated at $10 billion -- and counting -- might have lain untapped for who knows how long beneath the surface of the earth.
Certainly the coast along Labrador's Voisey Bay, where it often snows until June -- when the black flies descend -- had been explored in the past. Before Chislett and Verbiski set out in search of diamonds and minerals in June 1993, they pored over hundreds of reports and geological maps dating back to the 1920s and learned that Voisey Bay ore had been sampled by scores of experts. All their predecessors had found, however, was a harsh climate and a stark landscape of stone and stubborn vegetation: it appeared to harbour nothing more than "weathered-out" rock, in which all the valuable minerals had been oxidized by the elements.
But Chislett and Verbiski reasoned that most of the searchers were academics or government geologists. They weren't prospectors -- and that made all the difference. As Verbiski understates it: "Perception is everything. There've been a lot of ore bodies sampled and walked away from. Then someone else comes back and sees something different."
What enabled the two men to find "something different," says Chislett, was their approach. "Maybe I'm talking with 20-20 hindsight, but prospectors have a unique take on geological formations," he says. "Although we're often self taught, we really know our terrain. We're also not afraid to rely on gut feelings -- and we're usually hungry enough to keep digging after others have stopped."
As they sit in the spanking-new seventh-floor executive offices of Archean Inc., their St. Johns, Nfld.-based company, they take a rare moment to reminisce. Chislett, 46 is the storyteller of the two. The son of a fisherman, he grew up on the shores of Trinity Bay in the community of Islington. A former accountant, he started his own construction firm in 1974 and eventually turned to prospecting in 1988 to indulge his love of the wild.
Verbiski, 26, owes his introduction to prospecting to hockey. His father, Mort Verbiski, now a geophysicist with his son's company, was recruited from Nova Scotia by the Asarco mining company in central Newfoundland. The company wanted the high school graduate to play hockey in the province's senior league and gave him a job in the geophysics lab almost as an afterthought. Two things happened as a result: the senior Verbiski spent years learning geophysics and geochemistry from some of the best in the business -- and his son spent his summers hanging out in the lab, or tagging along with dad on field trips looking for copper, lead and zinc.
By the time Chislett and the younger Verbiski teamed up to form Archean and headed for Labrador in 1993, the latter was a veteran prospector with several mineral claims staked on the island of Newfoundland. Chislett already had three major claims of his own, including a potential gold deposit on an isthmus on the Avalon Peninsula.
None of their finds, however, generated the immediate excitement they felt during a helicopter ride over Voisey Bay one September afternoon in 1993. They had a spectacular view. "It was like an anchor you see on the beach," Chislett says of the distinctive outcrop on a mountain ridge they'd spotted, "a deep, deep red. It was looking pretty good. You have an eye for those things after awhile."
At the time of their discovery, the two had been hunting for signs of gold and diamonds for Diamond Fields Resources Inc., a Vancouver-based company that had advanced them $450,000 to check out rock formations similar to those containing diamonds in the Northwest Territories. Authorized to search some 500 river beds for the precious stones, Archean also swung a deal that would allow them to scout for gold and other base metals on the side -- with the provision that Diamond Fields would hold option on their claims. Archean would retain a three percent smelting royalty. That was, as it turned out, a prescient move.
Four months and 25,000 square kilometres into their search, however, the partners were discouraged. Plagued by clouds of black flies, a dwindling budget and an increasingly shaky commitment from DFR, the partners had come up empty time and again. The Labrador diamond team had originally consisted of seven -- Chislett and Verbiski, three helpers and two helicopter pilots. But by September 1993, there wasn't enough money to retain staff and Chislett and Verbiski had gone back to working by themselves.
THEN ON THAT CLEAR FALL afternoon, the maverick prospectors were flying over Voisey Bay in a chopper they had rented for a worrisome $650 an hour, winding down another fruitless search. After scanning the jagged fiord-studded landscape they knew so well, they were dejectedly heading back to the Inuit village of Nain from an island near the coast when they came upon a promising outcrop on a mountain ridge. Enter instinct.
"We could see a gossan zone to the east." Chislett explains, describing a rich, rusty-red geological formation that often indicates the presence of base metals such as copper. "We asked the helicopter pilot to veer over to have a look. Even then, we were pretty excited."
To their frustration, they had to leave the site without landing. Low on fuel, they turned toward the airstrip at Nain with nothing more than a few notes on their maps. It would be three days before they could return. And even when they did, Chislett told the pilot to keep the chopper running -- to eliminate the need for a restart and thus save fuel -- while they chipped off rock samples with prospecting hammers. He didn't quite believe what he was seeing.
Keeping the helicopter running turned out to be unnecessary. "We sampled a couple of rocks and this chalcopyrite [copper ore] just shot through them," Chislett recalls. "We quickly turned and waved to the pilot to shut the helicopter down.... I would say [about] 15 minutes after we landed, we found stringers of chalcopyrite running through the rock that had to [contain] at least two to three percent copper. We could tell that right away."
What Chislett and Verbiski had identified was an uninterrupted swath of mineralized rock stretching nearly half a kilometre, at widths of 50 to 60 metres. Their early estimates were right on target, but later core samples would yield even richer pockets of ore containing six percent copper, as well as nickel and cobalt.
CHISLETT AND VERBISKI didn't talk about the find -- not even in front of the helicopter pilot: they had to keep the rest of the mining world from muscling in on their discovery. Their secret remained safe until January 1994, probably because competitors thought they were still vainly looking for diamonds. The respite was all they needed. By then they had determined where to stake 288 claims covering about a dozen hectares -- and had raised $15,849 to do it. Financially it nearly destroyed them. "We were breaking our piggy banks open," Chislett says.
It didn't help that as late as April 1994, Diamond Fields was talking about cutting its losses after the unsuccessful search for diamonds. "[the company] wanted to get the hell out of Labrador," Chislett recalls now. "Whether they were going to hang out in the Voisey Bay prospect came down to whoever shouted loudest at the [board] meeting." By a margin of just one vote, the directors agreed to continue the project and gave Archean half the additional exploration money they needed.
Today, the nickel, copper and cobalt covered by the 288 mineral claims is worth an estimated $10 billion, and Archean's share is in excess off $300 million. As for Diamond Fields, its stake of the ore body, which turned out to have a remarkable 3.8 percent nickel content, drove mining industry experts wild and sent company shares rocketing from less than $5 each to more than $70 in just six months.
Chislett and Verbiski still control and direct the activity at the site. They put together an exploration dream team that includes University of Toronto geologist Tony Naldrett -- known as "Mr. Nickel" -- who has studied every major nickel deposit around the globe. "This is without parallel," Naldrett says of the Voisey Bay deposit. "There is nothing like this in the world."
What sets Voisey Bay apart is accessibility and purity. The ore body extends the length of Discovery Hill, breaching the surface in at least two places, and broadens out into a "great ovoid" in the valley below. Naldrett likens it to a massive tadpole and wonders if there are not more tadpoles tucked under the tail of this one. Voisey ore is so concentrated that a piece of rock the size of a microwave oven holds about a tonne of unrefined mineral and fetches $400. By comparison, at the Kidd Creek deposit near Timmins, Ont. -- a deposit often compared for its riches to Voisey Bay -- a piece of rock the size of an office desk holds a tonne of unrefined ore and is worth perhaps $200.
While Naldrett believes there may never he another nickel deposit so close to the surface, so near to ocean transport and so inexpensive to extract, he is equally convinced that the find at Voisey Bay is just the beginning. "This [nickel mass] is not just a one-off," he states. "They always come in groups of five or ten."
Terry Crebs agrees. The Denver-based geophysicist working with the team has already identified as many as 14 additional potential deposits by measuring the electromagnetic and magnetic intensities in areas containing troctolite rocks -- the host material of the Voisey Bay deposit. On that basis, Chislett and Verbiski have staked 8,000 additional claims for Diamond Fields, gobbling up more than 1,800 square kilometres of troctolite formation in virtually every area of Labrador.
Diamond Fields' wide claims on the area's troctolite have not prevented others from prospecting. By early summer 1995, a record-shattering 240,000 claims had been staked, covering one-fifth of Labrador -- an area nearly the size of Ireland.
THE UNPRECEDENTED nickel rush can be explained in two words stainless steel. The industry consumes more than 60 percent of the world's nickel and that figure is expected to hit 70 percent within a decade. According to Diamond Fields president Cliff Carson, the world was almost certainly headed for a nickel shortage before Voisey Bay came along but is now looking at a stable supply for at least 10 to 15 years.
All this exploration is having an impact on the Voisey Bay area. From the air, the landscape appears barely changed. The only human imprints are the narrow grid pattern cut through the forest and a few drilling machines scattered over Discovery Hill. Near the top, a drill team is grinding its diamond-studded drill bits toward the 200-metre level. Most holes have been sunk to a depth of 150 metres, but this one is aiming for 300, and as one geologist at the site put it, "We haven't hit bottom yet."
But down in the valley, human encroachment is more evident. A small village has sprung up just beyond the massive ovoid -- 20 tents and temporary buildings joined by wooden sidewalks and crude log walkways. There is a mess tent that can feed the site's 60 men and women in two shifts, offices with phones and fax machines, an ore sample lab and a building marked "Sundance Saloon." Hand-made street signs have sprung up and a signpost has been erected giving distances to places from Toronto to Tokyo. Barking at the heels of Diamond Fields' denizens and site geologists is the camp dog, an adopted stray from Nain called -- what else -- Nickel.
To give an idea of the incredible pace of the Voisey Bay exploration, Carson says the industry average from staking to drilling off entire ore body is 10 to 15 years. Archean Resources has done it in six months -- most of it through the long, frigid Labrador winter. It usually takes another seven years to begin production, but Carson figures that at Voisey Bay, they can do it in three or four.
STANDING IN THE WAY OF THIS speed-of-light progress, however, are environmental assessments and aboriginal land claims. Both the Innu Nation and the Labrador Inuit Association -- the two principal native groups in Labrador -- are claiming territory that overlaps the Voisey Bay site. The Innu have taken a hard-line approach, launching protests and promising court action if mineral production begins. They have stated repeatedly that they won't settle for less than a full land claim agreement before giving this project the go-ahead. "We're not naive enough to think this project is going to be easy to stop," says Innu president Peter Penashue. "But if [it] proceeds without substantive land claims, it diminishes the prospects for the Innu."
The Inuit, most of whom live in Nain, have accepted the Diamond Fields invasion with cautious optimism. As many as 18 Inuit are employed by Archean and Diamond Fields, and in a town where unemployment approaches 50 percent, the economic benefits are alluring. Instead of drawing the line at total resolution of the land claim settlement, Labrador Inuit Association president William Barbour says he would be satisfied with an interim impacts-and-benefits agreement that includes job provisions, environmental assessment and Inuit representation. "Through all of that we're doing a balancing act," he says, "trying to find work for our members and trying to maintain our traditional way of life."
The village of Nain appears to be just holding its own against the wave of outside influences. Arctic char can be seen drying on lines in front of virtually every house and the local diet still consists mainly of caribou, says mayor Richard Pamak. But his own house overlooking a magnificent fiord at the edge of town is now rattled by the sound of helicopter rotors from sun-up to sundown. In a place where not long ago everyone knew everyone, strangers have become a familiar sight. "Its too fast for us right now," Pamak says. "We'd like to slow it down to a pace we can handle."
Residents of Nain are not the only ones reluctant to change. Chislett and Verbiski miss the days they once spent ground-prospecting across Newfoundland and would like to hold on to the lifestyle they know and love. Chislett still drives the same four-year-old pickup truck, dents and all, that he drove before the $10-billion discovery. Verbiski still dresses in the same checked shirts and jeans he wore before Diamond Fields came along. But change is coming, it seems, for everyone involved with Voisey Bay -- change set in motion by two intrepid prospectors with bankable instincts.
