Pebble activity in southwestern Alaska heats up

A surge in claim staking surrounding the Pebble gold-copper-molybdenum deposit in southwestern Alaska has continued through the first three months of 2004.

Anchorage-based geological consultant Bill Ellis, part owner of Alaska Earth Sciences, estimates a total of 512 square miles of land has been recently staked for mineral prospecting in an area surrounding the Pebble deposit.

State records show that a total of 564 square miles, or 361,440 acres, is claimed by mineral prospectors in the Pebble area, according to Kerwin Krause, property manager in the Alaska Department of Natural Resources.

Pebble, part of a large porphyry mineralized zone, is about 17 miles northwest of the town of Iliamna on the north side of Iliamna Lake in southwest Alaska.

The region's three largest landholders staked a majority of those claims - about 300 square miles - last December. The claim staking work continued this spring, and two other companies have joined the fray.

"The perception has been that a major mining company was working in this area but had not hit any high grade zones and that it was not economic. Then the price of gold and copper increased significantly and the size of the deposit increased significantly," Ellis said. "It finally clicked with people that this is an economic area."

Northern Dynasty, operator of the Pebble project, in late January released an updated resource for Pebble, based on new drilling completed in 2002 and 2003 and data from past exploration work.

Resource estimates for Pebble put it at 2.74 billion tons of mineralization, containing an estimated 26.5 million ounces of gold and 16.5 billion pounds of copper.

But the surge in claim staking surrounding Pebble kicked off prior to that announcement. Alaska Earth Sciences led the way last December, staking an initial 28 square miles of land to the southeast of the large existing claim block held by Northern Dynasty and also by Teck Cominco.

Alaska Earth Sciences was back at the Iliamna area prospect this spring, Ellis said, staking in February and early March.

Most of the new staking was for Full Metal Minerals, which signed a land lease deal agreement announced in early March with Alaska Earth Sciences. Full Metal now has 115.5 square miles of mining claims for prospecting in the Pebble area, according to Ellis.

On-Line Exploration Services, another Anchorage-based geological consultant, staked more land in December and also in March for its client Northern Dynasty, according to On-Line Vice President Kevin Adler.

Northern Dynasty and Teck Cominco now hold a total of 150 square miles of claims surrounding Pebble. Liberty Star Gold Corp. staked its 237 square miles of claims, also last December.

Furio joins Pebble area exploration

This spring, Alaska Earth Sciences staked an additional 12.5 square miles of land about 22 miles southwest of the Pebble mineralization for a new player in Alaska's mineral exploration company, Furio Resources Inc.

Half of those claims are for a fifth, unidentified, company, said Furio's chief financial officer, Patrick McGrath. "The claims are on trend to Northern Dynasty's deposit," he told Petroleum News on April 7.

Furio, a recently formed Vancouver, British Columbia-based exploration company, picked the Pebble area to start its work, McGrath said, after seeing the new resource number released by Northern Dynasty.

"We decided to see if there was additional ground available in the area," McGrath said.

The reputation of Northern Dynasty, a Hunter Dickinson-managed company, also motivated Furio's decision to start work in Alaska.

"Northern Dynasty is run by management that has a history of turning deposits into mines," McGrath said.

Furio plans to spend up to $30,000 on its property this year, starting with initial geophysical ground work. "We'll follow up that with drilling," McGrath said.

Liberty Star conducts large airborne survey

Furio's property is about two miles southwest of a large claim block staked last December by Avalon Development for Liberty Star Gold Corp.

The largest one-time acquisition of state claims in Alaska's mining history, Liberty Star holds mineral exploration rights to 981 claims, or about 237 square miles, to the north and west of the existing Pebble claim block.

"We think we've already got everything that's important," said James Briscoe, president of Liberty Star, which did not stake any more claims this spring.

Instead, Liberty Star started work on a large, detailed air magnetic geophysical program, designed to help identify potential drill targets for later this summer.

"The results are highly detailed and interpreted as generally favorable," Briscoe told Mining News on April 2. "With computer technology, we're receiving pretty much up to date information as it comes in."

Liberty Star paid for an airborne survey of 1,402 square miles of land, geophysical data that extends beyond their existing claims. Follow-up groundwork will start, "as soon as the snow melts," Briscoe said.

The company plans to spend about $3 million on its property, dubbed the Big Chunk, this year. "It's going to a very, very aggressive program," Briscoe said. "We're taking a variety of steps to make sure the data flows more rapidly than ever seen on a project of this size."

Overseeing Liberty Star's exploration program is Phil St. George, former project manager of the Donlin Creek gold project for NovaGold. St. George is the geologist credited with the initial Pebble discovery while working for Cominco, Briscoe said.

St. George is also president of Holitna Energy, a privately held company that is seeking four state shallow gas leases in the Holitna Basin about 50 miles southeast of Donlin Creek.