Canstar Resources still can do

Toronto junior miner pushing exploration on CBS claims while awaiting arbitration ruling on highly prospective Mary March property

By Craig Westcott

The Business Post

After years of delay, Canstar Resources of Toronto is hoping to get the clearance any day now to resume exploration of the highly touted Mary March property in central Newfoundland.

The property has been in limbo because of a competing claim to the land by privately-owned Vinland Resources.

Canstar acquired rights to the property from Phelps Dodge, which in 1998 and 1999 came up with some of the most outstanding exploration numbers ever recorded in the Buchans area.

One of the discovery holes at Mary March ran 10.33 per cent zinc, 118.1 grams per tonne of silver, 1.62 per cent lead, 4.1 grams per tonne gold and 0.66 per cent copper over 9.23 metres of core. Another hole assayed 16.8 per cent zinc, 660 grams per tonne silver, 12.2 grams per tonne gold, 5.44 per cent lead and 0.18 per cent copper over 0.91 metres.

The property is located about 20 km from the former world class Buchans mine.

The dispute over the Mary March mineral claims started just as Phelps Dodge was signing over the rights to them to Canstar. That's when well known Newfoundland prospector Al Chislett, the co-discoverer of the Voisey's Bay nickel mother lode and the owner of Vinland, tried to record his own claims on the land.

The whole area was originally part of the Anglo Newfoundland Development Company's (A.N.D. Company) charter lands, which it had obtained from the government of Newfoundland in 1905 during the construction of the Grand Falls paper mill. But the exact definition of the lands is unclear.

The province's mining recorder refused Chislett's claims, ruling the land was already held by Phelps Dodge.

Chislett filed a grievance with the province's Mineral Rights Board arguing the Mining Recorder, a senior civil servant in the Department of Natural Resources, had erred.

Chislett contended Vinland Resources Ltd., had completed its own drill program on mineral claims adjacent to the disputed land and that shortly after that approached the mineral claims recorder to obtain the legal written description on the so called A.N.D. Charter Lands that shared a common boundary with Vinland's mineral claims. Chislett argued the mineral claims recorder was unable to give Vinland a written description of the disputed lands.

Chislett has alleged the Mary March property was not part of the A.N.D. Company's package, (Phelps Dodge obtained rights to the Mary March land through Noranda, which obtained them from a successor company of A.N.D.) while the Government of Newfoundland and Labrador argued that it was.

Through 2002 and 2003, a Mineral Rights adjudication board considered Chislett's claim, ultimately awarding title to Vinland.

In 2004, the provincial government appealed the board's decision to the Supreme Court of Newfoundland. Two-and-a-half years later, the judge overturned the board's decision. Vinland then appealed that decision to the Newfoundland and Labrador Court of Appeal.

Finally, last year, the Court of Appeal upheld the Supreme Court's decision. However, rather than specify which party owns the rights to the Mary March mineral claims, the judges handed it back to the Mineral Rights Board to consider all over again.

And that's just what the board is doing now. A decision is expected before the end of January.

Hodge is hopeful the decision will go Canstar's way and is confident the market for metals will recover and when it does, Mary March will attract investment capital.

"They say the Chinese economy is retrenching a bit and so on," says Hodge, "but there are 1.3 billion people there and they want everything we have, so they will want zinc and lead and copper and the whole bit, so it's going to come back."

Meanwhile, Canstar hasn't remained idle. While it was waiting for the Mary March decision last fall, it picked up the Pastureland property in Conception Bay South, just outside St. John's. Canstar chairman Harry Hodge heard about it during a scouting trip and checked it out for himself. It's located on a woods road leading to some farms.

"I came down looking at these old properties that I knew from years ago when I was with Noranda and used to come down periodically," says Hodge.

None of those passed muster, but Pastureland, which was suggested to Hodge by someone in the provincial government's Mines Branch, did.

Hodge says the property reminds him of things he's seen in the Buchans area. It contains both base and precious metals.

"I got taken with it," Hodge says. "There are some good showings out there, but hardly anything known about the geology of it. There's not much outcrop and very little exploration has been done."

The property came in handy because Canstar needed to spend some of its flow through share money, which it had raised for the Mary March property in anticipation of that coming open again.

The only testing that had been done up to Canstar sinking a drill bit into it this past fall was a couple of shallow holes by a prospector that hit economic grade mineralization, Hodge says.

The highlight of Canstar's 12 hole program was a 26 metre zone of thin, intermittent copper, lead and zinc sulphide mineralized bands. One 14 metre interval in the zone returned assay results of one per cent zinc, 0.6 per cent lead, 0.2 per cent copper and eight grams per tonne of silver, including a 2.2 metre section grading 2.6 per cent zinc, 1.7 per cent lead, 0.2 per cent copper and 26 grams per tonne silver.

Canstar is reviewing the assay results before determining its next step.

But again, much hinges on how the adjudication hearing on the Mary March property goes. If it's a positive decision for Canstar, Mary March is likely to get the priority.


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