Pickle Lake one of Ontario’s most prospective areas

To boost reserves at its 65% owned Golden Patricia mine, near Pickle Lake, Ont., LAC Minerals (TSE) is busy completing a US$1.7-million exploration program at the site this year. The Toronto-based company became a major player in northwestern Ontario last year when it bought a 65% interest in Bond International Gold (TSE).

LAC says the hit ratio during its recent underground drilling at the Golden Patricia mine has averaged about 55% in holes that tested below the mine’s upper ore zones.

Recent exploration has already defined additional reserves down to 1,300 ft. below surface, and the company is evaluating the possibility of sinking a shaft in addition to the existing ramp access.

Proven and probable reserves for the upper levels of the mine (above 650 ft.) were last reported at 446,000 tons grading 0.61 oz. gold per ton.

Last year, the fly-in mining and milling operation turned out some 78,759 oz. of gold at a total cost of US$357 per oz. Since the original reserve base is limited, additional mill feed will have to be found if the company hopes to extend the operation beyond its current 5-year lifespan.

LAC is also aggressively exploring Bond’s other claims in the surrounding greenstone belt, which extends for several miles on either side of the mine.

At least one new gold find, called the Tonsil Lake discovery, was made this year about seven miles west of the mine, but no reserve figures are available yet. Only about 12 holes have been drilled so far in the discovery. The new zone is about two miles west of Bond’s Dobie River deposit, which contains nearly 400,000 tons grading 0.16 oz.

A newcomer to the belt in 1990 was Vancouver-based Major General Resources (VSE), which acquired a large package of 32 gold properties from UMEX.

Byard Maclean, president of Major General, says his company is contemplating a winter drill program on its Dorothy Lake gold prospect, about four miles west of LAC’s Dobie River deposit. The Dorothy Lake deposits hosts about 284,000 tons grading 0.18 oz.

Vancouver-based Northern Dynasty Exploration (TSE) has halted its exploration activity in the Pickle Lake area due to lack of funds. The company has three main properties, all of which have been brought to lease status and are likely to be farmed out to seniors.

Cominco (TSE) and Noranda (TSE) have looked at Dynasty’s Arseno Lake zinc-lead-silver project in the North Caribou greenstone belt, while Inco (TSE) showed some interest in the junior’s Misehkow River gold prospect, about 25 miles southeast of Placer Dome’s (TSE) Dona Lake gold mine.

“The big mining companies are in the driver’s seat nowadays,” says Glen Simpson, president of Northern Dynasty. “Most of the seniors are just waiting for juniors to die so they can move in and take over their properties.”

Until recently, Dynasty was not eligible for government grants under the Ontario Mineral Exploration Incentive Program (OMIP). But last month, the government amended the scheme so that projects by companies with production can be eligible for reimbursements of 30% of their drilling costs.

“In this business you’ve got to be prepared to do a lot of drilling,” says Simpson, “but under the old OMIP, the incentive did not apply to companies with production.” The maximum grant is $300,000 per applicant per year.

Another junior active in the Pickle Lake area is Consolidated Gold Hawk (ASE), which recently signed a deal to option a 40% interest in Minnova’s (TSE) Tarp Lake prospect, 12 miles northeast of Pickle Lake. Gold Hawk is required to spend $1 million by Nov. 1, 1993. The best intersection on the property is 0.21 oz. gold per ton over 15 ft.

According to Don Janes, resident geologist with the Ministry of Northern Development and Mines, at least 50% of the exploration in his district has been financed by juniors, but many are having difficulty funding new programs this year.

Toronto-based Moss-Power Resources (TSE) is still actively exploring on several of its gold properties situated both north and south of Pickle Lake.

Harry Hodge, president of Moss- Power, is convinced the area has significant potential to host many more gold discoveries, but exploration has been in a slump recently.

His company’s most attractive gold project is located near Kasagiminnis Lake where preliminary reserves to 500 ft. below surface are estimated at 500,000 tons grading 0.15 oz. The property is about nine miles west of the highway to Pickle Lake. This winter the Kasagiminnis property will be the focus of a drill program designed to evaluate its low-grade, open pit potential, says Hodge.

Three of Moss-Power’s other gold properties situated west of the Golden Patricia mine are currently under option to LAC Minerals (TSE). The junior has nearly 44 properties in northwestern Ontario and has been working in the area since 1980.

Placer Dome (TSE), which owns the producing Dona Lake gold mine and operates a joint venture project with Inco (TSE) and Corona (TSE) at Opapimiskan Lake, Ont., is still negotiating quietly on several fronts to get the Musselwhite deposits into production. The main problem with the remote project is the lack of an economical power supply. It is estimated that a $30-million powerline would have to be built to support development of a mine at Opapimiskan Lake.

Work completed last year at Musselwhite delineated preliminary reserves of 7.4 million tons grading 0.20 oz. in the East Bay gold deposits. The West Anticline deposit hosts another 3.2 million tons grading 0.17 oz.

Just north of Pickle Lake, the former Thierry nickel-copper deposit owned previously by UMEX are now being examined by Etruscan Enterprises (VSE), a unit of NovaGold (TSE). The company is focusing its efforts on a low-grade, open pit copper-nickel deposit which was partly mined by Umex before closure of the mine in the early 1980s. The deposit hosts reserves of 55 million tons grading 0.31% copper and 0.1% nickel.