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Mining News: ‘Spell of the Yukon’ still rings true Gold dominates the some C$300 million being spent on 2011 exploration in Yukon Territory, but there is more to the modern rush Shane Lasley Mining News
YUKON TERRITORY – “There’s gold, and it’s haunting and haunting; It’s luring me on as of old; Yet it isn’t the gold that I’m wanting; So much as just finding the gold.”
This passage from the “Spell of the Yukon” is as applicable to the contemporary stampede of explorers seeking mineral riches in the home of the Klondike as it was to the prospectors of which Robert Service wrote more than a century ago.
It is estimated that the modern rush of prospectors to Yukon Territory will spend more than C$300 million on exploration here in 2011, the bulk of which will be spent on seeking rich lode sources of the placer gold-rich streams that drew their predecessors north at the turn of the 20th century. But aurum is not the only metal drawing explorers north; silver, zinc, lead and platinum group metals are other commodities being found across this mineral-rich land.
Mining News took a six-day government-sponsored trek around Yukon Territory visiting 14 projects ranging from a greenfield copper-gold prospect being generated by Tarsis Resources Ltd. near the Alaska border to Yukon Zinc Corp.’s Wolverine Mine more than 500 kilometers (310 miles) to the east.
Here is snapshot of the wide array of projects visited during the early August tour across this spellbinding landscape.
Junior finds copper-gold near Alaska WHITE RIVER – While masses of explorers staked up large swaths of gold-prospective land in the White Gold and Klondike districts, Tarsis Resources has quietly made a grassroots copper-gold-silver discovery at its White River project in the largely overlooked southwest corner of the Yukon Territory.
“The things that we are looking for are porphyry-style deposits or deposits that are related to that type of mineralization,” said Tarsis President and CEO Marc Blythe. “We like them because they are potentially large – and potentially large means bigger companies will be interested in them.”
Situated about 30 kilometers (19 miles) east of the Alaska border and 10 kilometers (6 miles) north of the Alaska Highway – White River is showing the potential to host the large-scale mineralization the project-generating junior is seeking.
Assay results received in early August – including one select sample containing 4.41 grams per metric ton gold, 0.47 percent copper and 391 g/t silver – confirm the property’s potential.
Apparently spurred by Tarsis’ work in the region, Teck Resources Ltd. has staked two claim blocks immediately to the southeast of the White River property.
During the Aug. 12 visit to White River, Tarsis provided Mining News a peak into the largely secretive world of claim staking in the Yukon Territory.
Waiting for the helicopter that is servicing both companies to deliver Teck’s geological team safely to the field, Tarsis loaded claim posts and headed out to stake a promising area adjacent to the southeast of Tarsis’ property and between the Teck claim blocks.
“Their crew went out first because it is their helicopter and we didn’t tell anyone we were going staking until the helicopter pilot came back,” Blythe explained with a grin.
Tarsis is seeking a company with the technical expertise and financial strength to take White River to the next level.
“We have had quite a lot of interest from potential partners with this property,” Blythe said.
He declined to say whether Teck was one of them.
Rockhaven systematically drills Klaza KLAZA – Blanketing a low-lying hill that is the source of several gold-bearing placer streams, the Klaza property seems to be the ideal place to look for a lode deposit, and Rockhaven Resources Ltd. is doing just that.
With a budget of just over C$6 million for 2011, Rockhaven has two core rigs systematically drilling off the main region of this gold-silver prospect, while an excavator and reverse circulation drill test outlying targets across the property.
Klaza – the widest and most consistently mineralized of four steeply dipping parallel structural zones – is the primary focus of this year’s exploration being carried out by Archer, Cathro & Associates.
Aiming to produce a mineral resource for Klaza, the core rigs are drilling this zone on 50-meter centers. At the time of Mining News’ Aug. 12 visit to the property some 30 holes had been drilled and Rockhaven intended to keep the rigs turning until mid-September. The RC rig has work scheduled until October.
Due to a serious backlog at assay labs, Rockhaven, so far, has received only sporadic results from its 2011 drilling.
Results from three holes that pierced the Klaza zone in 2010 provide a sense of the tenor of the mineralization. KL-10-03 cut 50.28 meters averaging 1.1 grams per metric ton gold and 23.5 g/t silver; KL-10-007 cut 36.5 meters averaging 3.23 g/t gold and 117.7 g/t silver; and KL-10-10 cut 33.3 meters averaging 1.04 g/t gold and 14.7 g/t silver.
Rockhaven believes enough assays from the 2011 program will be returned from the lab to release the first batch of results in “about two weeks” –a common phrase heard in the Yukon Territory this summer.
A road servicing placer mines in the region connect Klaza to Carmacks, a town some 50 kilometers (32 miles) to the east.
CEO’s smile says keep drilling Mariposa MARIPOSA – Without the sounds of an operating drill to guide our way, we wend our way from the helicopter landing zone to where the rig should be turning at Pacific Ridge Ltd.’s Mariposa gold project.
The silence emanating from the drill was not from a mechanical failure or some other technical issue – the drill crew had simply reached a predestinated depth of about 130 meters and was awaiting geologists to examine the core and to decide whether to keep drilling hole 11MP-27 or ready the rig for a move.
The smile that beamed across Pacific Ridge CEO John Brock’s face as he studied the freshly cut core said, “Keep drilling, this is what we are looking for!”
The orders implied by Brock’s smile were verbally confirmed by Pacific Ridge Vice President of Exploration Janice Fingler.
While the results of hole 27 will likely not be returned from the backed up assay labs for several weeks, hole 11MP-1 – which cut 38.9 meters averaging 2.44 grams per metric ton gold, including 11.1 meters averaging 6.44 g/t gold – provides a indication of the tenor of mineralization being sought at Mariposa.
Mariposa appears to be more akin to the Kaminak Gold Corp.’s Coffee Creek property about 12 kilometers (7.5 miles) to the southwest than Kinross Gold Corp.’s White Gold property about the same distance to the north.
Based on early exploration results, the company has increased its initial 4,000 meters of drilling to 6,000 meters. This expanded program will continue to focus on untested gold anomalies within the Skookum Jim target, one of five gold-in-soil anomalies found within a 21-square-kilometer (8-square-mile) area of the overall 262-square-kilometer (101-square-mile) property.
Plenty of low-hanging fruit at Coffee COFFEE CREEK – Since tapping the Supremo zone in May 2010, Kaminak has drilled eight gold discoveries stretching across a trend that exceeds 10 kilometers (6 miles) in length here on the Coffee Project and soil sampling is turning up new prospects ripe for exploration on the 150,000-acre (60,704-hectare) property.
“There is a lot of low-hanging fruit we are still plucking here,” Kaminak Vice President of Exploration Tim Smith explained during an Aug. 11 visit to the project.
Double Double has produced the juiciest fruit thus far. Hole CFD-90, drilled into this zone, cut four meters averaging 74.9 grams per metric ton gold. Double checking this phenomenal intercept, each of two follow-up assays returned similar results.
Smith explained that the consistency of these results not only confirm this ultra-high-grade gold intercept, but also demonstrate the fine-grained nature of the gold, which does not produce a nugget-effect in the sampling.
Kaminak believes the structure that is hosting the gold at Double Double could be a high-grade extension of the Latte zone, located 800 meters to the west. Results of a magnetic survey suggest this zone could stretch for several kilometers.
Kaminak has completed more than 30,000 meters of its planned 40,000-meter drill program outlined for 2011. Other low-hanging fruit being plucked by the company this year includes the Latte, Supremo, Kona, Connector, Macchiato and Cappuccino zones. Dependent on the timing of assay results from soil sampling at Americano West, this zone may also be ripe for drilling before the end of the season.
Stina follows Ryan’s recommendations DIME – Though Stina Resources Ltd.’s Dime property may not lie in the heart of the White Gold District, the project is in good company. Like Kinross Gold Corp.’s White Gold property some 40 kilometers (25 miles) to the southeast and Kaminak’s Coffee Creek project about 70 kilometers (42 miles) to the south, Dime is among the properties discovered by renowned prospector Shawn Ryan.
Stina CEO Jim Wall said the company, which optioned the property from Ryanwood Exploration, is following Ryan’s recommendations “to a tee,” including collecting 2,500 soil samples at Dime in 2010.
This geochemical program revealed three soil anomalies– Western, Central and Eastern – blanketing a 4,500-meter-by-1,800-meter area.
The Dime Property, in the White District, was the best new soil anomaly last year (2010),” Ryan informed the Stina board earlier this year.
The Western anomaly, which returned soil values as high as 6,082 ppb (6.08 g/t) gold, has been the primary focus of drilling at Dime. The best intercept of four holes completed here in 2010 was in DDH-10-04, which cut 32 meters of 0.71 g/t gold. DDH-10-03 intersected 1.5 meters of 4.15 g/t gold. This anomaly is the initial target of the 2011 program.
Stina management also took Ryan’s advice to hire Al Doherty, a professional geoscientist with a long history in the Yukon. In February, Doherty, who has worked as a consulting geologist in the territory for more than 25 years, joined Stina as vice president of exploration.
By following the techniques and recommendations of Ryan, Stina hopes Dime will have success similar to that achieved at White Gold and Coffee, two other Ryanwood properties.
Ryan Gold starts drilling at busy Ida Oro IDA ORO – The Aug. 10 arrival at Ryan Gold Corp.’s Ida Oro gold project was met with a bevy of activity. While helicopters shuttled to and from the rigs drilling on the ridge above camp, crews were logging core at a temporary outside facility, while other workers were busy constructing a more suitable core shack and other camp facilities needed to support this year’s planned C$6.5 million exploration program.
Though Ryan Gold CEO Michael Skead greeted his guests with an apology for what he considers disarray, the multi-faceted activity appeared to be carried out with a high level of discipline – especially when you consider the company received its permits to build the camp only two weeks earlier.
Incidentally, Ryan Gold’s drill program at Ida Oro started on July 27, just two days before the junior received permits to build the camp. Prior work at the project was coordinated out of the regional office in Dawson City about 90 kilometers (55 miles) west of the gold project.
For those not familiar with Ryan Gold, the name is not coincidental.
Though the famous prospector Ryan has become independently wealthy from vending many of his discoveries – such as White Gold, Coffee and Dime – to exploration companies, the savvy explorer kept around 50 properties in his pocket. These were rolled into Ryan Gold (formerly Valdez Gold Inc.) in a deal worth more than C$156 million and Ryan being appointed president of his namesake company for a term of five years.
Like many of Ryan’s other gold properties, Ida Oro has a large gold-in-soil anomaly. This 4,000-meter-by-1,000-meter geochemical anomaly is co-incident with a magnetic low defined by airborne geophysics carried out last year.
Ryan Gold plans to test this area with 12,000 meters of drilling in 2011.
Predator eyes reopening Brewery Creek BREWERY CREEK – Unlike the gold seekers of which the bard Service wrote, Golden Predator Corp. is not content with just finding the gold. This company is also rushing toward becoming the Yukon’s newest hardrock gold miner.
“The corporate goal is to be a gold producer in the Yukon and that is why Brewery Creek has turned into the flagship property,” Golden Predator Chief Geologist Mike Burke explained.
Approaching Brewery Creek by air, there is little evidence of the mine that produced 278,484 ounces of gold from 1996 through 2002; instead the reclaimed land more closely resembles a golf course. Viceroy Resource Corp., the operator of the closed mine, not only left behind a model for reclamation but the permits needed to revive the operation it shuttered during the era of US$300 per ounce gold.
Initially, Golden Predator felt Brewery Creek had the potential to provide up to 1 million ounces of gold in areas in and adjacent to where Viceroy mined, but with the success of the 2011 drill program, the company is thinking much larger.
“We feel fairly strongly there is multi-million ounce (gold) potential here,” Burke touted.
With a 74-meter intercept averaging 7.08 g/t gold, it is not hard to see why Golden Predator has become bullish about the property’s potential. Other high-grade intercepts in the Bohemian-Schooner zone discovered earlier this year includes 28 meters of 5.06 g/t gold and 22.5 meters of 5.5 g/t gold.
These high-grade zones lie outside the currently permitted area and will likely be mined later than some of the zones closer to the past-producing pits.
Initial production could come from the ore on the heap-leach pad. Viceroy only recovered about 60 percent of the some 400,000 ounces of gold it stacked on the pad. Golden Predator recently completed 20 holes on the heap leach pad for assay and metallurgical analysis.
Golden Predator aims to have the Brewery Creek Mine back in operation by 2014.
Victoria moves Eagle toward 2014 gold DUBLIN GULCH – Victoria Gold Corp. could edge Golden Predator out as the Yukon Territory’s next gold producer. Anticipating permit approvals in the coming months, Victoria is looking to begin construction of a heap leach operation at its Eagle Gold deposit in 2012 and producing gold sometime in 2014.
A newly built 100-man permanent camp – which was recently constructed to house the crews that will build the mine, followed by the Eagle Gold mine workers – is the most predominate sign that the project is transitioning from exploration to a producing mine.
Meanwhile, geological crews busy exploring for new deposits across the 400-square-kilometer (154-square-mile) Dublin Gulch property are enjoying the new facility.
Victoria Gold President and CEO John McConnell said the company is spending around C$10 million on exploration with about one-third being spent at the Eagle deposit, another third in the area immediately surrounding Eagle Gold, with the remainder being spent on regional exploration.
The company is particularly excited about a discovery exploration crews have made at Rex Peso, a regional prospect about 4 kilometers (2.5 miles) of the Eagle Gold deposit. Grab samples taken here returned assays as high as 1.8 g/t gold and 6,410 g/t silver.
Follow-up mapping and sampling programs are underway at Rex Peso, and we expect to start drilling by the end of the month,” McConnell said.
Predator taps first hole into Harlan HARLAN – Situated in the Mayo Mining District, Golden Predator’s Harlan gold property is one Burke has had his eye on for several years.
“I first saw field specimens from Harlan 15 years ago while working for the Yukon Geological Survey, and have eagerly awaited the chance to set foot on the property,” said Burke, who left the public sector to become Golden Predator’s chief geologist in January.
Though it is still early, Burke is not disappointed with what he sees at Harlan. Taking a look at core from the initial hole drilled into the property’s Vortex zone, the longtime Yukon geologist points out multiple vein-sets that delivered gold-bearing fluids into the sedimentary rocks.
“It’s been hammered up really good,” Burke observed.
Soil samples over a 1,600-meter-by-700-meter area at Vortex averages 500 parts-per-billion gold. Grab samples taken within the zone have returned assays as high as 6.5 g/t gold.
Though the property was investigated by Viceroy Exploration Inc. and NovaGold Resources Inc. in the late 1990s and more recently by Alexco Resources Inc., Golden Predator’s nine-hole program is the first drilling ever conducted on the property.
Excitement prevails at Osiris discovery NADALEEN CAMP – If the significance of a gold discovery could be measured by the intensity of excitement and activity surrounding it, then ATAC Resources Ltd.’s Rackla Gold property would come out on top.
Touching down in the midst of the newly built Nadaleen camp situated at the base of the mountain that hosts the Osiris gold discovery, two additional helicopters were busy shuttling materials and yet another was standing by for its next mission. All told, five copters are servicing exploration at Osiris and other Nadaleen Trend prospects at the eastern extent of ATAC’s more than 180-kilometer (110-mile) long Rackla Gold Belt.
The palpable enthusiasm elevates when a smiling Julia Lane, senior project geologist at Osiris, launches into an overview of the discoveries made at Osiris and across ATAC’s massive property.
Referencing a map that stretches nearly two meters (six feet), Lane said, “It’s a big project … it’s exciting!”
Considering that even the skeptics admit that the Nadaleen Trend appears to be Canada’s first Carlin-style gold discovery and more than 96 million ounces of gold has been mined from the original Carlin Trend in Nevada, it is easy to see why Lane is excited.
This discovery of a new style of mineralization comes with significant drill intercepts. The first hole drilled at the Osiris zone in August of last year cut 65.2 meters averaging 4.65 g/t gold. At Conrad – a zone situated about 1,000 meters northeast of Osiris – ATAC intersected 21.13 meters grading 8.03 g/t gold and 82.29 meters of 4.08 g/t gold.
Argus aims to revive historical Hyland HYLAND GOLD – Applying new geological interpretations and modern exploration techniques, Argus Metals Corp. has set out to revive the historical Hyland gold project.
Past work at Hyland has outlined a resource of 3.2 million metric tons of oxide ore averaging 1.1 g/t at the Main zone. The first holes of Argus’ 4,000-meter drill program this year are targeted to expand this resource and upgrade it to NI-43-101 compliance.
The balance of the 2011 drilling will test gold-in-soil anomalies along about 6,000 meters of the Quartz Lake Structural Trend, a fault that stretches for some 24 kilometers (15 miles), and seek a deeper sulfide feeder zone. The company is using data from an Abitibi TEM geophysical survey conducted at the property this summer to help target the ongoing drilling.
Nestled along the shore of Quartz Lake, Argus’ Hyland camp has the advantage of being winter road accessible from the Alaska Highway about 84 kilometers (52 miles) south. In turn, a road connects the camp to the company’s gold project. These factors are helping to limit the need for air transportation, lowering the exploration costs at the southeastern Yukon Territory prospect.
Overland targets 2015 zinc production ANDREW – Overland Resources is busy collecting the final bits of data it needs to begin permitting a mine at its Andrew zinc-lead project in Southeast Yukon Territory.
With a goal of being in production in 2015, a time-frame that coincides with a forecasted global zinc shortage due to the closing of several mines, the company plans to complete a feasibility study for Andrew by the end of 2011 and submit permit applications to build a mine early in 2012.
“We are hoping to get this feasibility study out by the end of this year or early next year. Likewise, we would like to apply for our mine permits through YESAB (Yukon Environmental and Socio-economic Assessment Board) next year,” Overland Senior Geologist Sheila Ulansky explained.
While engineering firms collect the last bits of data needed to complete the feasibility study and environmental consultants finalize baseline data collection, Overland is completing 10,000 meters of drilling aimed at expanding the project’s resource.
All told, the Andrew property has a resource of 11 million metric tons averaging 5.8 percent zinc and 1 percent lead. The bulk of this ore is located in the Andrew deposit, which has a measured resource of 1.6 million metric tons averaging 5.5 percent zinc and 1.7 percent lead and an indicated resource of 4.7 million tons at 6.2 percent zinc and 1.6 percent lead. The Darcy deposit about 500 meters to the southeast has an additional indicated and inferred resource of 3.5 million metric tons averaging 5.3 percent zinc.
High-grade gold reveals Yukon potential 3ACE PROJECT – While the White Gold District and the Rackla Gold Belt demonstrate the Yukon’s potential, the high-grade gold discovery at Northern Tiger Resources Inc.’s 3Ace project reveals just how underexplored the territory is.
“Some people might think the Yukon is a mature exploration district but Alex (McMillan) was able to walk in from a road and find an outcropping quartz vein that runs 5,000 grams per ton gold, so I think that bodes well for all of the money that is being spent in the Yukon and there being additional new discoveries,” says Northern Tiger President and CEO Greg Hayes.
The chunk of quartz the First Nations prospector carried the 2 kilometers (1.2 miles) down the mountain to the Cantung Mine Road contains 4,820 g/t gold to be exact.
Finalizing an option agreement with McMillan early in 2010, Northern Tiger geologists outlined a 2,000-meter-by-2,000-meter area containing high-grade gold in soils and rock.
Encouraged by initial exploration conducted in 2010 – which included a 30.3-meter intercept in the discovery hole averaging 4.3 g/t gold – Northern Tiger is conducting a 10,000-meter drill program at 3Ace this year.
In addition to drilling, this year’s C$6 million exploration program includes extensive soil and stream sediment sampling, mapping and geophysical surveys. This work is designed to set the stage for what Northern Tiger plans to be an even more ambitious agenda in 2012.
“Our aggressive 10,000-meter drill program is intended to really demonstrate the potential of the property this year by proving that the extensive gold mineralization we are seeing at surface extends to depth, and it will also allow us to properly prioritize targets for what we anticipate will be a much larger program to start establishing resources next year,” Hayes told Mining News.
Zinc mine eases toward full production
After a 280-kilometer (175-mile) helicopter flight northeast from Whitehorse, the Yukon Territory’s newest mine comes into view.
Situated at the southeast end of Wolverine Lake, the mill, camp and other facilities at Yukon Zinc Corp.’s Wolverine Mine sit above a volcanogenic massive sulfide ore body that contains an estimated reserve of 5.15 million metric tons of ore averaging 9.66 percent zinc, 0.91 percent copper, 1.26 percent lead, 281.8 g/t silver and 1.36 g/t gold.
Running at its full 1,700-metric-ton-per-day capacity, this is enough ore to keep the mill operating for nearly 10 years. Currently though, the underground operations are only supplying enough of zinc-rich rock to operate the plant at about 30 percent of its design.
After an April 2010 mine collapse that resulted in a fatality, Yukon Zinc halted mining while it conducted underground geotechnical engineering. This work – which resulted in ground stabilization plans for the upper levels of the mine and a comprehensive plan for a range of ground conditions – has slowed the timeline for full production at Wolverine.
Don Strickland, the general manager at Wolverine, said Yukon Zinc anticipates the mining to be ramped up to commercial production sometime in 2012.
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