Yukon-Nevada Cuts More Gold At Ketza River

Yukon-Nevada Gold (YNG-T, YNGFF-O) has intersected gold in stepout holes on its past-producing Ketza River project, near the town of Ross River in the Yukon, 125 km northeast of Whitehorse.

The intercepts are reported from four targets. QB is a quartz vein target, while the other three consist of mantos, a type of chemical- replacement sulphide mineralized body. In the mantos at Ketza, massive sulphides have replaced limestone.

The latest four assays from the QB target returned 7.8 metres grading 5.8 grams gold per tonne starting at 60 metres depth in hole 1390.

Another notable intercept was in hole 1376, returning 3.8 metres of 8.8 grams gold from 72 metres. True widths are not known.

The latest five assays from the three manto targets returned 9.8 metres of 3.2 grams gold from 130 metres in hole 1389, drilled into the Break zone. Drilled at the Hoodoo zone, hole 1422 cut 4.6 metres of 4.6 grams gold from 74 metres, and hole 1425 cut 3 metres of 6.6 grams gold from 72 metres. Hole 1362, drilled into the Peel zone, cut 2.9 metres of 10.4 grams gold from 52 metres depth, followed closely by 0.9 metre of 10.4 grams gold.

In view of the shallow depth of the manto targets, Yukon-Nevada sees them as candidates for a multiple open-pit operation.

QB is a part of the Shamrock zone. QB and another Shamrock target, 3M, might be loosely characterized as stockworks or breccias, although the host rock is a siliceous siltstone and not an intrusive. The mineralization is in veinlets and altered zones around veinlets, and is not necessarily restricted to larger veins. Therefore, QB and 3M are also candidates for open-pit mining.

Conversely, other zones in Shamrock, named Gully and Chute, are larger vein targets. They will be approached differently, and underground mining will be considered if grades justify it.

In a release, Graham Dickson, Yukon-Nevada’s president and CEO, said the results confirmed Ketza River would be a viable open-pit operation with an extended lifespan. A 2007 resource estimate put measured and indicated resources at 4.1 million tonnes grading 4.9 grams gold per tonne for 646,000 oz. gold, plus 1.1 million inferred tonnes grading 3.3 grams gold for 113,000 oz. gold.

A previous operator, Canamax, was active at Ketza between 1988 and 1990, mining 100,000 oz. gold from 340,000 tonnes of oxide ore grading 11.6 grams gold per tonne. Owing to low gold prices, the 350- tonne-per-day operation closed without mining the sulphide resource, and some infrastructure still remains (T. N. M., Aug. 11- 17/08).

Yukon-Nevada envisages a 60,000-to 70,000-tonne-per-year operation, running for 10 years.

Yukon-Nevada is awaiting assays from another 24 holes at Ketza.

The company also owns the Jerritt Canyon gold mine, 80 km north of Elko, Nev., where mining was suspended in August because of negative cash flow.

In April, Yukon-Nevada started milling again at Jerritt Canyon, having completed work at the mill to address environmental requirements from the government. Ongoing air-emission issues are being addressed.

Yukon-Nevada says it has 80,000 contained oz. gold in stockpiled material, anticipated to cost less than US$300 per oz. to process. The company expects that it will be able to deal with all its outstanding liabilities during the 10 months it will take to process the material.

Yukon-Nevada hopes to reach full production rates by mid-May; it has not announced a restart of mining yet.

In the year to Dec. 31, Yukon- Nevada had a net loss of about US$105 million on revenues of US$49 million. On Dec. 31, the company had current assets of US$29 million, including about US$1 million in cash, and current liabilities of about US$37 million.

In February, the company closed two private placements totalling $1.5 million. In March, the company announced a private placement of $720,000.

The company has 301 million shares outstanding. At presstime, the shares were trading at 14¢ in a 12-month range of 2¢-$1.60.