The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Hang on to your hat, the data is beginning to roll in from Alaskan field programs and there are some hum dingers in this month's data and several others will be showing up next month.
What's a "hum dinger"? How about an Alaska gold project at the center of a $1.5 billion corporate takeover by the world's largest gold producer? Or how about 75 feet grading more than 2 ounces of gold per ton? Or maybe silver production costs of a negative $2.28 per ounce?
But wait, there's more - if you act now you'll receive free sorry I've gotten carried away. Read on and decide if 'hum dinger" says it all!
Western Alaska
The biggest news in the last month was the unsolicited takeover offer for NovaGold Resources made by Barrick Gold Corp. The two companies are currently 70:30 partners, respectively, in the Donlin Creek gold deposit.
On July 24 Barrick offered $14.90 per share, valued at $1.53 billion for the outstanding shares of NovaGold.
NovaGold's two main assets, the Donlin Creek gold deposit and the Galore Creek copper-gold deposit in British Columbia, are the driving forces behind the offer.
NovaGold's directors have recommended that shareholders reject the offer, saying among other things that the buyout does not fully value NovaGold's assets.
The imbroglio does not look like it will be resolved any time soon.
TNR Gold Corp. said Phase I results from drilling at its Shotgun project in Southwest Alaska consisted of approximately 3,976.5 feet of diamond-drilling in 10 drill holes testing anomalies at Winchester (1,475.5 feet) and extensions to the Shotgun Ridge zones (2,501 feet).
Hole 06-45 in the Winchester zone returned 77.5 feet grading 1.90 grams of gold per tonne. Hole 06-43 in the Shotgun Ridge zone returned 1.29 grams of gold per tonne over 690.5 feet. Mineralized zones at Shotgun Ridge are interpreted to be dipping southwest and would not have been fully tested by previous drilling. Estimated Inferred Resources at Shotgun Ridge are 980,000 ounces grading 0.93 grams of gold per tonne at a 0.5 gram per tonne cut-off.
Brett Resources has nearly completed core drilling at its Sleitat Mountain tin project northeast of Dillingham. The program is aimed at confirming and expanding historic resources as estimated by U.S. Bureau of Mines (26 million tonnes in the range of 0.22 percent-0.37 percent tin with 17 grams of silver per tonne). Results are pending.
Andover Ventures and Full Metal Minerals have begun a 750 meter diamond drilling and surface exploration program at the Kamishak copper project on the Alaska Peninsula.
Interpretation of the historic drilling suggests that the previously discovered breccia pipe mineralization is open for expansion to the west and east and to depth. The 2006 drilling program will focus on expanding known mineralization along strike and at depth. In addition, surface sampling and IP geophysics will be conducted to test for strike extensions as well as new mineralized occurrences.
Andover Ventures also said they have acquired the Bulk Gold project in the Nome District from Altar Resources. Mineralization at the Dripping Gold zone is defined by a 1,400 foot long soil anomaly with gold values up to 5.3 grams of gold per tonne. Arsenopyrite rich, silicified felsic meta-intrusive float, found within the zone assayed up to 4.5 grams of gold per tonne, plus greater than 150 grams of silver per tonne.
Additional drill targets on the property include the 2,500 foot-long Dorothy Creek soil and rock anomaly situated above the Dorothy Creek gold placer and the Hed & Strand Extension target. The Hed & Strand Extension target is along strike and down dip of the past producing Hed & Strand gold-antimony lode mine.
Andover can earn a 100 percent interest in the project by incurring $2.9 million in exploration expenditures over four years, issuing 750,000 shares over three years and making option payments starting at $15,000 for the first year and totaling $500,000 over five years.
Linux Gold has begun drilling at its Granite Mountain project on the Seward Peninsula. Hole KW06-01 on the Gossan Ridge prospect was drilled vertically to 870 feet and encountered sheared and veined altered intermediate volcaniclastic andesite country rock and interbedded felsic rhyolite to rhyodacite units. Sericite alteration is more common in the upper part of the hole while potassic alteration increases at depth. Felsic units are from one to 10 feet thick and well-mineralized with pyrite, pyrrhotite and bismuthinite in carbonate-altered quartz veins and veinlets and as disseminated grains.
The mineralized intervals are numerous and occur in stacked sets over the entire drilled section. It is estimated that 80 percent to 85 percent of the entire drilled section is mineralized. The intrusive rocks are also mineralized with disseminated pyrite replacing biotite and pyrite and bismuthinite in quartz-carbonate veinlets. Drilling and reconnaissance exploration efforts are continuing. Additional staking was also completed which brings the claim block to 68 square miles in size.
Full Metal Minerals said JV partner Metallica Resources recently completed drilling at its Bee Creek copper-gold-molybdenum project on the Alaska Peninsula. Results are pending.
Full Metal Minerals also said JV partner Triex Minerals recently completed drilling at its Boulder Creek uranium project on the Seward Peninsula. Results are pending.
Eastern Interior
Kinross Gold announced second quarter results from the Fort Knox mine near Fairbanks. The mine produced 99,437 ounces of gold at a cost of $267 per ounce. Production increased 15 percent in the second quarter of 2006 when compared to the same period in 2005 as a result of increased tonnage and a higher grade, partially offset by a lower recovery as the mine processed a zone of metallurgically complex ore.
Freegold Ventures Ltd. announced results from trenching at its Cleary Hill mine on their Golden Summit project. In the eastern extension of the Cleary Hill, trenching along 185 foot strike length of a four-inch to 18-inch wide vein returned 39.5 grams of gold per tonne including a 75 foot section grading 83.4 grams of gold per tonne.
On the nearby Wackwitz Vein trenching discovered a new five-foot wide zone averaging 16.4 grams of gold per tonne over 235 feet including 85 feet grading 34.8 grams of gold per tonne. In addition, a newly discovered 10 to 15-plus foot wide shear zone 50 feet to the south of the Wackwitz vein returned 2.2 grams of gold per tonne over 220 feet. The company plans to conduct an additional 2,500 feet of trenching and collect a 10,000-ton bulk sample from three of the previously completed trenches.
Full Metal Minerals said it has started drilling on its Fortymile gold project near Chicken. The 800,000-acre property is under option from Doyon Ltd.
An initial five drill holes will test the Fish prospect where an extensive 15 to 23 meter thick base-metal rich gossan has been traced for 1,500 meters along strike, and more than 250 meters of vertical relief. Drilling will also test the LWM sedex prospect where intensely weathered massive to semi-massive sulfide gossan occurs. Prior to drilling, a detailed ground-based gravity survey will refine the drill target at LWM.
Alaska Range
Nevada Star Resource Corp. said Anglo American Exploration (USA) Inc. has withdrawn from its joint venture on Nevada Star's MAN Alaska project in the central Alaska Range.
The joint venture effort over the last two years consisted of $3 million worth of exploration on the Fish Lake and Dunite Hill prospects. Work funded during this period included geophysical and geochemical surveys and 10,281 feet of diamond drilling on the Fish Lake prospect.
Nevada Star indicated that it was reviewing the results of the 2006 drilling program prior to determining how to proceed on additional project exploration.
Full Metal Minerals said it has expanded exploration efforts at its Lucky Shot gold project near Anchorage. The company has added an additional drilling rig to the program and has increased the program from 60 to 80 holes totaling 15,000 meters.
Full Metal Minerals said the Alaska Mental Health Trust had awarded it the 22,647 acre Chickaloon Coal lease in Southcentral Alaska. These coals exhibit ranks ranging from high volatile "A" bituminous to semi-anthracite, with the rank of medium to low volatile bituminous being the dominant rank. The greater proportion of the coals is of high-value coking quality.
Coal was mined from six different operations in the Chickaloon area from 1905 to 1922 and from 1958 to 1960. There has been no significant production and minimal exploration from this high quality coal field since. At least four coal seams have been identified on surface and at past-producing operations, varying in thickness from 1.5 meters to 7 meters. They occur within the Chickaloon Formation, a Paleocene to Eocene-aged sedimentary sequence that hosts all the coal measures in the Matanuska Valley.
Coal seams are commonly structurally thickened along the hinges of major folds. Increased structural deformation to the east within the Matanuska Valley has resulted in a progressive increase in coal rank to the east. The company plans to conduct drilling this year in addition to surface mapping, sampling, and possibly geophysics.
Full Metal Minerals announced a 1,000-meter drill program, in six holes, is planned at is Coal Creek tin project in the southern Alaska Range. The program is designed to upgrade previously estimated resources of 4.9 million tonnes grading 0.27 percent tin with minor tungsten.
Southeast Alaska
Kennecott (70.3 percent) and Hecla (29.7 percent) announced second quarter 2006 production from the Greens Creek mine on Admiralty Island. The cash cost per ounce of silver at Greens Creek for the quarter was a negative $2.28 per ounce of silver (yes, minus $2.28 per ounce), indicating that other metals (gold, lead and zinc) more than paid for the cost of production during the quarter.
The average grade of ore mined during the quarter was 13.73 ounces of silver per ton, down nearly 4 ounces per tonne over the same period in 2005. During the second quarter the mine produced 1,751,597 ounces of silver, 12,613 ounces of gold, 4,022 tons of lead and 12,408 tons of zinc.
Total production costs for the quarter were $1.22 per ounce of silver produced, down significantly from the $3.54 per ounce cost of the year previous figures. Silver production has decreased from a year ago primarily because of a 25 percent lower silver ore grade, a rehabilitation work program completed on major underground intersections in the mine, and less favorable timing for accessing higher-grade working faces due to development work.
Mine production was hampered in the second quarter by significant waste haulage and power outages necessary in order to tie into the public utility services. This year's exploration program has defined a new resource in the West Gallagher Zone that will be reported at year end. This ore zone remains open to expansion.
In addition, ore-grade intercepts have been intersected approximately 750 feet and 1,000 feet up dip from the mining faces in the area known as the 5250 zone. If the ore proves to be continuous between the current work area and the new intercepts, significant new tonnage could be added to reserves.
Coeur d'Alene Mines had some welcome news for its Kensington mine project last month.
First off, the U.S. District Court for the State of Alaska has dismissed a suit challenging the company's U.S. Army Corps of Engineers 404 permit relating to tailings disposal.
The company also was notified that the Kensington project has been chosen to receive the prestigious 2006 Hardrock Mineral Community Outreach and Economic Security Award presented by the U.S. Bureau of Land Management. The award is given to hardrock mining projects that have shown responsible mineral resource development while demonstrating an understanding of sustainable development.
Meanwhile back at the farm, capital investment at Kensington in the second quarter totaled $20.9 million. Recent activity has focused on construction of the mill building and completion of major earthworks. Development drilling during the second quarter totaled 23,000 feet.
Bravo Venture Group Inc. reported that several multi-ounce gold surface outcrop and rubble samples were recovered during sampling at its Woewodski Island project in Southeast Alaska. Sample grades from metallic screen fire assays range from 0.021 ounces of gold per ton to 14.27 ounces of gold per ton. High-grade quartz with visible gold has been located in float and narrow bedrock veins along 400 meters of Blue Quartz Creek. Similar narrow veins elsewhere on the island are hosted in east-northeast trending sub-parallel structures up to 10 meters in width. Additional work is under way to determine the extent of mineralization and develop drill targets.
Niblack Mining announced additional results from its Niblack massive sulfide project in Southeast Alaska.
Hole LO-165 intersected three distinct massive to semi-massive sulfide horizons separated by zones of stringer and disseminated mineralization. The entire interval totals 56.02 meters of 2.94 grams of gold per tonne, 48 grams of silver per tonne, 0.92 percent copper and 2.70 percent zinc over a true width of approximately 53 meters. This hole and several others reported, extend the mineralization in the Lookout zone to 150 meters down plunge.
Drill hole LO-168, drilled 100 feet up dip of LO-165, intersected 53.19 meters grading 3.85 grams of gold per tonne, 59 grams of silver per tonne, 0.80 percent copper and 3.56 percent zinc. Hole LO-171, drilled a further 100 feet up dip of LO-165 and LO-168, yielded 3.96 meters of 2.86 grams of gold per tonne, 71 grams of silver per tonne, 0.63 percent copper and 15.05 percent zinc.
In addition, a new zone of base metal massive sulfides was intersected at the Mammoth zone where hole LO-174 intersected 18.65 meters of semi-massive and massive sulfide grading 0.47 percent copper, including 4.33 meters grading 1.01 percent copper. Drilling has also identified a near surface gold-oxide zone at Lookout where hole LO-175 intersected 27 meters grading 3.12 grams of gold per tonne and 89 grams of silver per tonne, in addition to 4.60 meters grading 11.99 grams of gold per tonne and 125 grams of silver per tonne. Additional drilling is under way.
Curt is President of Avalon Development Corporation, a mineral exploration consulting firm based in Fairbanks, Alaska. He is a U.S. Certified Professional Geologist with the American Institute of Professional Geologists (CPG #6901) and is a licensed geologist in the State of Alaska (Lic. # AA 159).
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