The Matagami Project

The Québec Mineral Exploration Association, recognizing what it described as “outstanding exploration success,” awarded its 2007 Prospector of the Year Award to a joint-venture team from Donner Metals and Xstrata Zinc Canada in November of 2007. The team discovered high-grade zinc, copper, silver and gold mineralization in five new zones at the Bracemac/McLeod area, located 6km southeast of Xstrata’s Matagami Mill. Donner has the option to earn a 50% interest in the large Matagami project from Xstrata Zinc. The Matagami project under this joint venture agreement began in late 2006 and the first discovery was announced in January of 2007.

The Matagami Mining Camp is a world-class mining district, with 18 known VMS deposits, including 10 past producers of varying sizes, including the giant Matagami Lake deposit (25.64 million tonnes of 8.2% Zn, 0.56% Cu, 20.91 g/t Ag and 0.41 g/t Au) discovered in 1957 and mined from 1963 to 1988. In 1957, as a result of the newly developed airborne EM system, the Matagami Lake deposit was discovered and within the next two and a half years, six more major deposits were identified. Between 1985 and 1992, four new deposits were discovered, and in 1999 a new EM system was flown over the Matagami camp, which led to the discovery of the Perseverance deposits in 2000. 

The development of new exploration techniques and concepts has led directly to numerous discoveries in the Matagami Mining Camp, including Perseverance, which is scheduled to go into production in July 2008. Xstrata has published a measured and indicated resource at Perseverance of 5.12 million tonnes of 15.82% Zn, 1.24% Cu, 29.00 g/t Ag and 0.38 g/t Au. The Matagami area is host to historical production of 8.6 billion pounds of Zn and 853 million pounds of Cu and has established infrastructure including the town of Matagami, a railway, a paved road, and a 2,600 t/day mill owned by Xstrata.

Traditionally, a single marker horizon called the Key Tuffite has been targeted for exploration as all of the historical mines produced high margin zinc, copper, silver and gold-bearing sulphides from this horizon. Drilling on the Matagami Project is actively investigating other horizons as well as the Key Tuffite. With this approach, three new, vertically stacked sulphide zones have been discovered at Bracemac (two above and one at the Key Tuffite horizon). Two new sulphide zones have also been discovered at the Key Tuffite horizon at McLeod in addition to the recent extension of the previously known Old McLeod zone, also at the Key Tuffite.

Proximity of the Matagami Project to past producers and existing deposits does not provide any assurance that economic mineralization exists on the Matagami Project, however past production and recent discoveries in the camp demonstrate the potential for additional discoveries.