Whitehorse, Y.T. — In an effort to improve its economy, the Yukon government is rolling out the welcome mat as it tries to lure companies back into exploring and mining in the territory. Buoyed by a resurgence in metal prices on the heels of devolution in the Yukon, the future for the industry does appear much brighter.
Since the shut-down of Brewery Creek in 2002, the only production has been gold from placer operations and that was only 100,000 oz. last year. With no hard rock mines operating at present, things couldn’t get much worse, especially in a region of the country that was founded on mining. However, if the current trend continues, several mines could be up and running within the next few years according to Michael Burke, staff geologist with the Yukon Geological Survey.
Many of these projects have been shelved for years owing to low metal prices and unfavourable economic conditions, as well as a complex regulatory regime prior to devolution.
Claim staking has been very active in the Yukon this year, particularly in the fall after the forest fires died down. Burke says there were a total of 9,061 claims staked in 2004, which is nearly triple the 3,571 claims staked in 2003.
The Yukon government took over the responsibility for mining from the federal government, since the territory’s devolution transfer agreement was signed in April 2003. The current government seems keen on working with industry and the federal government to establish greater certainty for access to the resources, water licences, and land use permits.
As an added incentive, the Yukon government recently extended its mineral exploration refundable tax credit of 25% and companies are taking notice.
Several advanced stage base metal and gold projects are contenders for becoming the first mine to start producing again in the Yukon.
In a move that surprised many this past summer, Expatriate purchased
A prefeasibility study by Hatch was commissioned to build on previous development plans for Wolverine that were completed in October 2000 as part of the Finlayson Lake project. The study showed that the relative metal value of the deposit was 54% zinc, 26% silver, 12% copper, 5% gold and 3% lead. Cash costs of zinc production, reduced by the silver, copper and gold credits, would be below US30 per lb.
Capital costs for Wolverine are estimated at $100 million.
Existing mineral resources give the mine a nine-year life, but the company believes underground bulk sampling this winter will confirm a larger resource and extend the mine life to 15 years.
“The underground development will start with a portal at the 1,750-metre level and include about 650 metres of development to extract some 36,000 tonnes of ore as a test mine,” explains Jason Dunning, Expatriate’s project geologist at Wolverine. “The ground conditions will be an important determining factor in the mining method, which will in turn affect the costs.”
Permitting for the underground program is under way and talks are ongoing with representatives from the Kaska First Nation, which owns the rights to the Wolverine deposit. A 16-km road would be required along what is now considered a winter trail in order to gain access to the nearby Robert Campbell Highway.
In September, geologists discovered a new massive sulphide occurrence that it named Thunderstruck, owing to a lightening bolt that struck the ground at that location during a thunderstorm. The target is on the company’s wholly owned Goal Net property.
The massive sulphide mineralization at the discovery is 0.3 metre thick and was followed along strike for 200 metres to the east where it disappears under thick overburden cover. Massive sulphide mineralization on Thunderstruck in samples assayed 13.4% zinc, 5.07% lead, 0.34% copper, and 40.7 grams silver and 0.04 gram gold. Drilling of at least 10 holes began in the fall at Thunderstruck, as well as other regional targets.
The results for drilling this year at
The fully permitted Minto copper-gold-silver project, 240 km northwest of Whitehorse, is half-built, with a feasibility study completed in 1995. The capital cost of the project is estimated to be $25 million. The project was shelved in 1998, owing to low metal prices.
In the fall of 2004,
“They have extended the time period for companies to review the project,” says Burke. “The biggest problem is that Asarco had the option agreement where it must fund the capital cost of the project. But they have funded it only piece-meal. In short, the project probably didn’t fit the company, so Asarco is selling its stake. A successful bidder could maybe get the ball rolling there in fairly short order. They even have a great haulage road, which is ready to go.”
Burke describes Minto as a high-grade open-pit deposit. Plans call for a mill designed to process up to 477,000 tonnes of ore per year over a mine life of 11 years.
During each of the first five years of operation, an average of 12,000 tonnes copper, 11,500 oz. gold and 172,000 oz. silver would be produced.
Asarco can earn a 70% interest in the Minto project by funding development up to US$25 million and commencing commercial production.
An independent resource estimate was done on
The Blende property contains at least 35 million oz. silver, 590,000 tonnes zinc and 540,000 tonnes lead. The deposit comprises 19.6 million tonnes grading 56 grams silver and 5.84% combined lead-zinc. Within this resource are 15.3 million tonnes grading 67.5 grams silver per tonne and 6.27% lead-zinc.
Although initially explored as an open-pit target, the partners believe the deposit could be developed as a smaller, higher-grade underground operation.
Blende was originally discovered by the GSC in 1961 and first staked in 1975 by
By adjusting the cutoff grade of the blocks calculated previously, the resource could be reduced in tonnage but increased in grade to 4.1 million tonnes grading 3.1 oz. per ton silver, 6.7% lead, and 4.6% zinc.
Yukon Zinc recently acquired the Swift property in south central Yukon, comprising 116 quartz mining claims in the Watson Lake mining district. The Rancheria district has numerous zinc-lead-silver occurrences and has yielded two significant discoveries over the last 30 years.
The company believes the Swift property has potential for moderate- to high-grade massive sulphide mineralizatio
n and intends to explore the property this summer with an eye for high-grade mineralization that could potentially be processed in conjunction with its Logan deposit, 55 km to the northeast.
Hole TLP04-01 averaged 0.982 gram gold over 19.6 metres from 77.4 metres down-hole, which includes 3.4 metres grading 3.18 grams gold. Hole TLP04-02, 50 metres south of TLP04-01, returned 3.92 grams gold over 10.47 metres from a 60.55-metre depth. This includes 11.56 grams gold over 1 metre and 11.45 grams over 2 metres.
The 2004 program included 16.5 km of ground very-low-frequency electromagnetic and magnetometer surveys and nine diamond drill holes.
Eight of the nine holes tested the westernmost of three parallel conductors. All eight holes drilled on this trend intersected mineralization controlled by steep southwesterly dipping vein structures.
The company plans further drilling to extend known mineralization and test more geophysical anomalies.
High-grade epithermal mineralization was intersected on
Results from the first diamond drill hole intersected a stockwork zone that returned 90 metres averaging 2.25 grams gold from 37.5 metres depth in hole GC-04-0225.
The stockwork comprising quartz-adularia veins was found throughout the interval. An intense interval, 17.5 metres long, occurs from a depth of 91.5 metres and averages 6.79 grams gold, including higher-grade sections of 14.38 grams gold over 2 metres and 17.77 grams over 2.3 metres.
The stockwork was intersected in holes GC-04-225, 226 and 227 so far. Hole 227 hit 22.12 grams gold over 6.25 metres in veins found 20 metres north and 35 metres below previously drilled high-grade veins.
The company aims to test the northerly extent of this trend over the winter.
An independent review recently confirmed the gold resource in the Eagle zone on
The resource stands at 55.2 million tonnes grading 0.934 gram gold, or 1.7 million oz. gold in the indicated category. There are another 17.3 million tonnes grading 0.734 gram gold, or 412,000 oz. gold in the inferred resource category. Both categories are based on a cutoff grade of 0.5 gram gold.
Additional drilling of the Eagle zone to test gold mineralization at depth and along strike was recommended, as well as infill drilling, to raise the inferred resources to indicated within the pit outline.
StrataGold aims to increase the overall gold resources in the area.
The company’s landholdings in the Mayo gold district now total 740 sq. km. The company’s existing properties adjacent to Dublin Gulch (Aurex and Lynx) also have significant potential.
The gold is contained in the Tintina gold belt within three deposits. The Skukum Creek, Mt. Skukum and Goddell Gully deposits have measured and indicated resources of 1.1 million tonnes of 7.99 grams gold and 153 grams silver per tonne, for 284,000 oz. gold contained along with 5.5 million oz. silver.
Tagish Lake is keen to test other target areas that could potentially add to the resource. The company endeavours to raise $3.5 million in order to further explore the property with the aim to increase and upgrade the resources in the Rainbow and Kuhn zones to 1.15 million tonnes. The company believes this would provide enough material to warrant getting the mine and mill complex up and running again even at prices of US$350 per oz. gold.
Determined to find the elusive host rock for the coarse placer gold found in the Indian River area near Dawson City,
The most recent placer results included gold grades that ranged from 1.6 metres of 0.052 gram gold per tonne in a 14,442-kg sample to a high of 3.65 metres of 0.288 gram gold from a 40,197-kg sample from another site.
Boulder believes the coarse gold is near the bedrock source, owing to the gold’s association with quartz.
On the emerald front,
The 2004 drill program consisted of 54 holes totalling 3,503 metres, of which 46 holes (3,084 metres) were completed on the Summit zone. A total of 213 intervals indicated favourable emerald geology and included 8 intercepts containing emeralds in the core.
These eight intercepts occur over a 200-metre vertical section within an area at least 2 sq. km., separate from the recently discovered zones at Howdy Ridge.
The emeralds recovered in core include crystals ranging from 1 to 15 mm and comprise gem, near-gem and non-gems.
The company’s mini-bulk sampling and trenching recovered 21.2 kg of emerald rough from 582.3 tonnes of material from Tsa Da Glizsa. This represents 36% of the sample collected; the company plans to process the remainder this year.
The 21.2 kg of emerald rough comprises predominantly near-gem and non-gem emerald: 823.76 grams (4,118.8 carats) gem quality; 7351.75 grams (36,758.75 carats) near-gem; and 13,007.15 grams (65,035.75 carats) non-gem emeralds.
The company is using independent test-cutting labs outside of Canada on the rough emerald.
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