The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
As the late, great Phil Rizutto used to say when something amazing happened on the baseball field: "Holy Cow!" The last month has seen an explosion of activity across Alaska with companies working in virtually every region on a diverse package of metals including gold, platinum group elements, silver, molybdenum, lead, zinc, copper and nickel. Several new companies have entered the exploration field in Alaska and several new partners have joined forces with previously active companies to advance Alaska mineral properties.
Western Alaska
The biggest news of the month was the joint venture between Northern Dynasty and Anglo American plc for development of the Pebble project. Under terms of the deal Anglo can become a 50 percent partner in Pebble by making staged cash investments of $1.425 billion. Anglo's staged investment includes a committed expenditure of $125 million to complete a pre-feasibility study targeted at the end of 2008. After the completion of the pre-feasibility study, Anglo must elect to commit to a further $325 million for a feasibility study, the completion and approval of which is targeted for 2011.
Upon the decision to develop a mine, Anglo must elect to commit to the next $975 million of expenditures to retain its 50 percent interest, completion of which will meet the $1.425 billion requirement. Thereafter, any further expenditure will be funded on a 50-50 basis. If the feasibility study is completed after 2011, Anglo's overall funding requirement increases to $1.5 billion.
Northern Dynasty will assess its 50 percent share of any project debt financing when a production decision is made.
Not sure about this but I think the $1.425 billion earn-in is the largest joint venture earn-in amount in Alaska mining history. Anybody out there know if this is the case?
St. Andrew Goldfields has posted second-quarter production results from its Nixon Fork gold-copper mine near McGrath. In the second quarter the mine processed 7,433 tonnes of ore with a head grade of 16.0 grams of gold per tonne.
Mill recovery rate for the quarter averaged 70.5 percent producing 2,661 ounces of gold. The company also sold 258 tonnes of copper concentrate from which it received $2.7 million.
Mine development scheduled for completion in the second quarter fell behind schedule due to equipment and mining personnel shortages and ore-face availability issues encountered at the upper portion of the Crystal deposit. The company believes it has rectified the issue by revising its mine plan to accelerate the development of the lower portion of the deposit and by hiring a mining contractor to solve labor shortage issues.
The company plans to shut down the mill for about six weeks in August and September to allow for the planned installation of tailings filtration equipment and the integration of the dry stack tailings facility at the mine. Mining and development operations will continue and ore will be stockpiled at the mill.
NPN Investment Group signed a letter of intent with Millrock Resources Corp. to joint venture the company's recently acquired Divide gold property on the Seward Peninsula. Millrock can earn a 50 percent interest by paying one half of NPN's obligations under its current option with the property owner. Millrock will make payments to NPN totaling $500,000 and issue 500,000 common shares of Millrock over the next 4 years.
Andover Ventures Inc. said ground work is under way on both the KUY and Kamishak properties on the Alaska Peninsula. Andover has completed induced-polarization ground geophysics at its KUY gold prospect and at the Kamishak copper-gold project under option from Full Metal Minerals. Additional work is planned for this year at both prospects.
Andover Ventures also said drilling has begun at its Bulk Gold project near Nome. The 2007 drill program is scheduled to drill approximately 2,000 feet of core in five holes. The holes are planned to drill test the plus-5,000 foot long Dorothy Creek soil anomaly, the downdip extension of the historic Hed & Strand lode gold-antimony mine, the Antimony Dome geophysical and geochemical anomaly and the down dip extension of the Big Pig target.
Alaska newcomer Great Basin Gold Ltd. has signed a letter of intent with Talkeetna-based Clark/Wiltz Mining to earn an 80 percent interest in the Ganes Creek property in the Ophir District. Pursuant to the agreement, a minimum of $800,000 in exploration expenditures is required in 2007 followed by an additional $1million by the end of 2008 and a final $1.2 million in expenditures by the end of 2009.
Great Basin Gold can also increase its interest in the property at a production decision by purchasing the remaining 20 percent at fair market value should Clark/Wiltz Mining not wish to participate in any development costs. Clark/Wiltz Mining would retain a 2 percent NSR of which 1 percent could be purchased by Great Basin Gold for $2 million. Welcome to Alaska Great Basin Gold!
NPN Investment Group has entered into an option agreement with Andover Ventures on the latter's Alaska Peninsula project. The project, on lands owned by Bristol Bay Native Corp., includes the KUY, Fog Lake, Kemuk, Chilikat East, Chilikat West, Koksetna and Samuelsen prospects. Under terms of the agreement, NPN can earn a 50 percent interest spending a total of $3.5 million over a period of 4 years plus pay $1 million NPN shares to Andover over the same period.
Full Metal Minerals has optioned its Moore Creek gold project to Alaska newcomer Highbury Projects Inc. Highbury can earn a 60 percent interest in the property by incurring $2.1 million in exploration expenditures, issuing 50,000 shares, and paying Full Metal $60,000 cash.
The companies will complete a surface trenching and airborne geophysical program during the summer of 2007. Welcome to Alaska Highbury Projects Inc!
Tonogold Resources Inc. announced results from a coarse gold study conducted on 2006 drill samples at its Nyac gold project. Comparison of coarse and fine gold fractions from drill core assays at Bonanza Ridge indicated that the coarse fraction increased with depth. Gold content in the coarse fraction ranged from 0.3 to 137 parts-per-million gold, while total gold content in the anomalous intervals ranged from 0.3 to 8.2 parts-per-million gold. Coarse gold occurs over at least 250 vertical meters within the southeastern half of the Bonanza soil anomaly where all of the 2006 drilling occurred.
Pacific North West Capital and joint venture partner Stillwater Mining said numerous shallow soil and deep auger overburden samples have been taken in the Red Mountain and Susie Mountain target areas at their Goodnews Bay platinum project. This sampling program will be largely completed by the end of August. Promising new chromite occurrences have been located in the Red Mountain area. Assays are pending.
Eastern Interior
Kinross Gold announced second-quarter results from the Fort Knox mine near Fairbanks. The mine produced 93,930 ounces of gold at a cost of $320 per ounce. Production decreased 6 percent in the second quarter of 2007 when compared to the same period in 2006 as a result of fewer tonnes being processed and lower grades, partially offset by slightly higher recoveries.
During the quarter the mill processed 3,323,000 tonnes of ore grading 1.01 grams of gold per tonne. Gold recovery averaged 87 percent. The company is advancing two projects at Fort Knox, the Phase 7 pit expansion and the valley leach project. It is expected that feasibilities will be completed on both of these projects by the end of 2007. The mine has secured all necessary state permits and is awaiting the federal permit for the valley leach project.
Freegold Ventures Ltd. announced additional drilling results from the Beistline prospect area at its Golden Summit project. Highlights include 15 feet averaging 16.13 grams of gold per tonne in hole 447; 78 feet averaging 1.52 grams of gold per tonne in hole 450; 27 feet averaging 4.17 grams of gold per tonne in hole 451; and 3 feet grading 34.8 grams of gold per tonne in hole 456.
Recent drilling has identified four parallel east-west trending structures over a width of 175 feet. Two of the structures have been traced over a strike length of 860 feet and remain open in both directions. Significant gold mineralization has also been intersected between the first two structures in the form of ladder structures.
Rimfire Minerals Corp. and joint venture partner Rubicon Minerals Corp. said a four-hole, 975 meter drilling program at its Goodpaster project has intersected a 7.4 meter-wide gold-bearing zone of quartz veining at the California North prospect. Hole CN07-01 was drilled to test the California North gold and arsenic soil geochemical anomaly. Quartz vein mineralization was intersected at a depth of 72.6 meters and averaged 1.2 grams of gold per tonne over a 7.4 meter width including 2.5 meters averaging 2.2 grams of gold per tonne.
At least one additional hole is planned for the target in 2007 to determine the true thickness and orientation of the vein. Drilling is planned to commence in mid-August. Soil sampling at the Cal-Surf, Eagle and Swede properties returned anomalous gold and pathfinder element geochemistry in soil samples. Additional work has been recommended for these areas.
Rubicon Minerals Corp. announced additional results from its New Horizon gold project in the Goodpaster District. Surface follow-up work and reconnaissance diamond drilling is being conducted in the area of the Maple Leaf showings. Results are pending.
Recent surface prospecting has identified new mineralized areas at the American Eagle and Tourmaline Ridge prospects. At the American Eagle showing, sheeted white quartz veins ranging from 0.1 to 1.0 centimeters thick are hosted in granite. Vein material makes up 5 percent-10 percent of the country rock over an area of 400 by 50 meters.
Quartz veins at American Eagle host extremely course grained bismuthinite in flat, sometimes deformed tabular plates ranging up to 1.0 centimeters in maximum dimensions. The bismuth-bearing veins have not been seen in outcrop and occur on a coarse boulder-strewn talus slope just below a flat ridge line. Limited grab sampling along this ridge has returned gold values ranging from trace to 3.03 grams of gold per tonne, up to 3,880 parts-per-million bismuth, up to 5,610 parts-per-million arsenic and up to 494 parts-per-million molybdenum. The full extent of this mineralization is unknown.
At the Tourmaline Ridge showing the upper 150 meters of elevation on this ridge over an 800 meter length along the ridge crest is composed of tourmaline-bearing sediment-derived gneiss containing massive tourmalinite with lesser quartz veins and tourmaline-vein breccias. Sampling of the tourmaline-rich rocks has returned weakly elevated gold numbers (maximum 164 parts per billion), up to 804 parts-per-million bismuth and up to 2,620 parts-per-million arsenic.
Full Metal Minerals announced additional drilling on the LWM polymetallic prospect at its Fortymile project under option from Doyon Ltd. Significant drilling results include hole LWM07-07, which returned 15.6 meters averaging 21.2 percent zinc, 8.7 percent lead, and 127.0 grams of silver per tonne. Hole LWM07-09 is the deepest intercept of massive sulfide yet encountered on the property, and hosts the highest silver and copper grades yet encountered, with 6.48 meters averaging 464.2 grams of silver per tonne, 31.6 percent zinc, 11.3 percent lead and 1.41 percent copper.
Drilling and ground magnetic geophysics suggests that the carbonate package hosting the massive sulfide mineralization dips to the south and trends to the northeast towards the company's Fish prospect.
Full Metal Minerals also announced initial sample results from its Eva prospect on lands also within the Fortymile project under option from Doyon Ltd. A total of 14 samples were collected from subcrop and historic prospect pits at the Eva Prospect. Individual silver values include 3,730, 1,960 and 1,280 grams of silver per tonne.
All samples of mineralized rock averaged 957 grams of silver per tonne, 23.6 percent zinc, 12.6 percent lead, and 0.9 percent copper. Three samples averaged over 25 percent lead. Samples were collected over a 50 meter by 50 meter area of rubble crop. Mineralization occurs within a marble unit replaced by partially oxidized, coarse-grained massive sphalerite, galena and chalcopyrite.
The company recently discovered an extensive area of partially oxidized sphalerite and galena within a vegetation "kill zone" at the Drumstick prospect within the same marble unit, 2,200 meters north of the Eva prospect. The area between the two prospects is covered by overburden and vegetation. Additional work is planned.
International Tower Hill Mines announced drilling results from its Livengood gold project. The new results confirm the presence of high-grade, "sediment-hosted," disseminated gold mineralization. This new style of mineralization overlies the mineralized lower grade volcanic units which have been the main focus of the exploration in the central target area of the property.
Significant results from the sediment-hosted mineralization include 8.8 meters grading 9.95 grams of gold per tonne and 8.5 meters grading 9.64 grams of gold per tonne in hole MK07-18 which overlies an additional 78.6 meters grading 1.09 grams of gold per tonne hosted in the underlying volcanic sequence.
The new sediment-hosted mineralization is characterized by decalcification, chaotic fracturing, strong oxidation and pervasive silicification. The highest grade parts of these new zones are associated with strong decalcification and commonly contain stibnite. The 2007 Livengood drill plan calls for approximately 8,000 meters of core drilling.
Metallica Resources announced that it had optioned the Liberty Bell gold project in the Bonnifield District from a private owner. Under terms of the agreement Metallica will invest $2 million in exploration expenditures and deliver a feasibility study by the end of 2011, or incur additional exploration expenditures totaling $5.5 million and deliver a feasibility study by the end of 2015.
Alaska Range
Pure Nickel Inc. has begun its 4,000 meter, $4 million exploration drilling program on its MAN nickel-copper-platinum group element project. Prior to drilling the company completed a 3,327 line-km VTEM B-field system airborne geophysical survey and an extensive geochemical survey on the property. In combination with previous exploration on the property the company has used these new data to establish high priority targets that are the subject of the current drill program.
MAX Resource Corp. announced that drilling has commenced at its Gold Hill molybdenum project in the Valdez Creek District. Previous exploration by other parties returned significant results including hole 77-2 which returned 536 feet grading 0.048 percent molybdenum disulfide starting at surface, with a higher grade interval from 350-500 feet which returned 0.094 percent molybdenum disulfide.
Northern Alaska
Silverado Gold Mines announced that 1,250 ounces of nugget gold (1/4 inch and larger) have been recovered from its Nolan Creek mine since the start of sluicing operations in late June. These nuggets range in size from 1/10 ounce to 12.4 ounces in size.
Andover Ventures Inc. announced the commencement of drilling at its 100 percent owned Sun project on the Ambler Mining District. A second drill rig is expected to arrive shortly and a third rig is expected in August. The drill program will include twinning some of the 49 historic drill holes on the property drilled by Anaconda, Teck Cominco and Noranda.
Southeast Alaska
Kennecott (70.3 percent) and Hecla (29.7 percent) announced second quarter 2007 production from the Greens Creek mine on Admiralty Island.
The cash cost at Greens Creek for the quarter was a negative $3.458 per ounce of silver.
The average grade of ore mined during the quarter was 18.19 ounces of silver per ton, up significantly from the 13.73 ounces per tonne mined during the same period in 2006.
During the second quarter the mine produced 2,316,256 ounces of silver, 15,126 ounces of gold, 4,833 tons of lead and 13,289 tons of zinc.
Total production costs for the quarter were a negative 34 cents per ounce of silver produced, down significantly from the $1.22 per ounce cost of the year previous figures.
Second-quarter exploration emphasis was on definition drilling of the 5250 North extension, where some spectacular intersections have been recorded with intervals exceeding 50 ounces of silver per ton and combined lead and zinc grades of 20 percent. The zone appears continuous throughout the 800 feet of drilled strike length and appears to continue along a shallow-dipping structure to the west.
Alaska newcomer Altair Ventures Inc. has entered into an option agreement with Full Metal Minerals pursuant to which Altair has an option to earn up to a 75 percent interest in Full Metal's interest in the CJ gold project on Prince of Wales Island.
Under terms of the agreement, Altair may earn a 60 percent interest in the property by making $3.5 million in exploration expenditures, paying an aggregate US$305,000 to Full Metal and land owner Red Diamond Mining and issuing 1.3 million shares to Full Metal.
Exploration work at the CJ property commenced in June and will include structural mapping, soil and rock sampling and a proposed 1,800 meters of core drilling.
Welcome to Alaska Altair Ventures Inc.!
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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