Junior seeks flavor of Coffee prospect

Kaminak Gold Corp. is one of the frontrunners in the exploration rush sparked by Underworld Resources Inc.'s recent gold discovery in the White District of Yukon Territory. In less than six months, the junior mining company has acquired and explored claims that offer as much promise initially as Underworld's White Gold Project did in its first season of exploration.

Kaminak is primarily a prospect generator with a successful business model that targets discovery-stage projects with strong exploration potential for strategic commodities with an emphasis on gold. The junior previously distinguished itself by spinning out a uranium exploration and development company, Kivalliq Energy Corp., which is focused on the Lac Cinquante Deposit in Nunavut, considered northern Canada's highest grade uranium deposit.

Kivalliq was the first company in Canada to sign a comprehensive agreement with the Inuit of Nunavut to explore for uranium on Inuit-owned lands in the northern territory. The landmark partnership gives Kivalliq the opportunity to explore and develop Lac Cinquante, which reportedly contains 20.4 million pounds of uranium oxide with grades more than 1 percent U3O8, according to a non-NI 43-101-compliant estimate. The historical deposit and more than 160 other uranium occurrences on the property comprise Kivalliq's core asset, the 270,000-acre, or 112,033-hectare, Angilak Project.

Though it also holds an extensive portfolio of properties, including a number of joint ventures, in a half-dozen mineral-rich Canadian provinces and territories, Vancouver, B.C.-based Kaminak turned its attention to Yukon Territory this year, acquiring an option in May from Ryanwood Exploration Inc., a Dawson City-based prospecting company, to earn 100 percent interest in three prospective gold properties - Coffee, Cream and Kirkman.

The primary target on all three properties is a near-surface, bulk tonnage gold deposit analogous to that of Underworld's White Gold, which is located only 8 kilometers, or 5 miles, from the Kirkman property and 27 kilometers, or 18 miles, from the Coffee and Cream properties.

In 2008, Underworld drilled 18.1 meters grading 4.35 g/t gold and 50.7 meters grading 3.1 g/t gold revealing a new mineralized gold system. Underworld reinforced its discovery in early 2009 by drilling a spotlight-grabbing 104 meters grading 3.4 g/t gold. The junior confirmed extensive gold mineralization at White Gold in subsequent drilling, and is currently working to calculate a resource estimate.

A winter Roundup connection

Kaminak Gold became interested in the White District in west-central Yukon after meeting Dawson prospector Shawn Ryan at Roundup in January.

Ryan, who heads Ryanwood Exploration Inc., promoted the potential of Coffee, Cream and Kirkman when he met with Kaminak's chairman, John Robins, and president and CEO, Rob Carpenter, in January. Ryan had extensively prospected the claims himself, just as he had the White Gold claims that he optioned to Underworld a few years ago.

"We first met Shawn at (the Mineral Exploration) Roundup in January," Carpenter told Mining News in a Nov. 4 interview. "He showed us some of these datasets. There were many people looking and a lot of companies put in bids for an option on the properties."

Kaminak shrewdly followed the same type of lead that so intrigued Underworld about the region. "We could see that the properties had sizable fingerprints," Carpenter said.

From the pool of bidders, Ryan chose to partner with Kaminak.

"We had a good track record, and we had a strong treasury at the time, when many juniors were beginning to have problems. I think that showed him that we could do the job," observed Carpenter.

Early interest in the Klondike

Exploring the White District also meshed well with Carpenter's professional interests.

"My wife used to be a naturalist who worked for several years on a cruise line that goes up to Alaska," he said. "I got interested in the Klondike through her. It has an amazing history."

Carpenter said he and his wife, Melanie, also vacationed a couple of times in Yukon Territory and he visited the local historical museums and learned more about the region's mining history.

Since acquiring the Coffee, Cream and Kirkman claims, Carpenter said he has learned even more about the properties' history.

"The claims are located near Coffee Creek, an old placer producing area," Carpenter said. Otherwise the properties have been undisturbed since, aside from an old World War II bomber that crashed on the site years ago with no fatalities, he said.

The exploration this summer also gave Carpenter an opportunity to personally examine the geology of the region. "I had an old professor who told me that you're only as smart as the rocks you've seen," he said

This up-close and personal understanding helps geologists make big mineral discoveries. "One thing about the big gold deposits is that they are usually quite complicated, and the Coffee dataset showed a lot of complexity," Carpenter said.

Educated in Ontario, Carpenter, who was born and raised in New Brunswick, spent his early career in Nunavut, working on mine projects every summer since his sophomore year in college. While working as the territory's first geologist for the Canadian government, he completed his thesis on the Meliadine gold project in Nunavut. The work gave him a front-row seat during nearly a decade of major gold discoveries in the territory, including the Ulu deposit near the old Lupin Mine, along with Meliadine and the Hope Bay discovery.

"I was lucky to see a lot of rocks. I was able to see every deposit and hear the stories of how they were discovered," Carpenter said. "Yukon Territory geology is very different and more similar to the geology of British Columbia and Alaska. Nunavut geology is more like that of Ontario."

Hitting the ground running

Kaminak quickly mounted an initial exploration program in June with prospecting and geochemical sampling work on its new properties that verified the existence of a coincident soil anomaly consisting of elevated gold, arsenic and antimony similar to that observed by Underworld on its properties where subsequent trenching and drilling led to the discovery of bedrock mineralization by that junior.

On Kaminak's Coffee property, more than 1,250 soil samples have been collected and results have outlined a core anomaly measuring 1.5 kilometers by 2 kilometers, or 1 mile by 1.25 miles, which is characterized by a strong geochemical signature defined by gold (highest threshold from 80 to 839 parts per billion), arsenic (100 to 1,758 parts per million) and antimony (8 to 117 ppm).

Two smaller grids also were established along the regional strike situated 2.5 kilometers, or 1.5 miles, east and 4.5 kilometers, or nearly 3 miles, west of the core grid.

Both grids outlined anomalous gold values with the highest threshold values on the western grid ranging from 50 to 643 ppb gold, and values on the eastern grid ranging from 50 to 148 ppb gold.

The three separate grids are demonstrating anomalous gold values over a linear length of 10 kilometers.

To Kaminak, these results indicate that the size and intensity of the Coffee soil anomaly is the largest new gold-in-soil anomaly in the White District. Compelling soil geochemical anomalies also occur on the Cream and Kirkman properties, though the junior focused most of its energies on the Coffee property in 2009.

Exploration during the warm months included extensive trenching of the known soil anomalies, along with additional soil sampling, ground magnetic surveys and geological mapping. The goal of the work was to identify and prioritize diamond drill targets.

In August, the junior reported geochemical results from more than 1,700 soil samples taken from previously unexplored areas of the Coffee property in order to generate additional trenching targets.

Kaminak recovered up to 3.16 grams per metric ton gold from a new 450-meter-long geochemical anomaly located more than 1 kilometer from other trenching areas.

The anomaly is defined by six consecutive samples with assay values ranging from 131 parts per billion gold to a high of 3,156 ppb gold, or 3.156 g/t gold.

The main Coffee gold-in-soil anomaly also was extended to the north by at least 500 meters and now measures 3.2 kilometers long by 1.2 kilometers wide.

The junior also uncovered gold geochemical anomalies associated with a distinctive pathfinder signature of arsenic and antimony.

"Soil sampling remains the most effective exploration tool in the non-glaciated White District," Carpenter said at the time. "Our soil sampling has uncovered several new priority trenching targets, and we are still awaiting results for an additional 1,300 soil samples."

A total of 1,787 soil samples were analyzed and 51 of these samples yielded results greater than 75 ppb gold (highest threshold). Overall, results ranged from background (lesser than 15 ppb gold) to a high of 3,156 ppb gold, or 3.156 g/t gold.

Gold-in-soil anomalies also are associated with high arsenic and antimony, and 93 samples yielded arsenic values greater than100 ppm arsenic (range 1 to 967 ppm) and 22 samples assayed greater than 8 ppm antimony (range 0 to 17 ppm).

More staking triples property size

In September, Kaminak staked another 210 claims covering 4,250 hectares, or 10,243 acres, which tie on to the southwest corner of Coffee and extend south and west to the Cream property. The junior effectively tripled its holdings, and now has title or title pending to more than 13,000 hectares, or 32,000 acres, in the White District.

The new claims were staked in order to cover possible extensions of newly defined soil anomalies on the Coffee property. Kaminak said it has received results for more than 2,250 soil samples from Coffee, resulting in the definition of eight separate gold-in-soil trends occurring over a length of 11 kilometers. Several of these trends remain open to expansion. From west to east the trends are named; Espresso, Kona, Latte, Supremo, Double Double, Mocha, Arabica and Java. With the exception of Supremo, all of these trends were identified in this year's soil sampling program. The staking also resulted in Kaminak connecting the Coffee and Cream properties.

In late October, Kaminak reported new chip sample and trenching results from the Supremo gold-in-soil anomaly on Coffee. The junior said two new north-south trending trenches 6 meters apart were dug directly on top of an original east-west trench in hopes of expanding the known extent of the mineralization. In the original trench, samples averaged 2.3 grams per metric ton gold over 21 meters. The latest results include 11.72 g/t gold over 10 meters in samples from one trench and 8.56 g/t gold over 15 meters in samples from the other trench. Both of these high-grade results begin right next to the original trench and extend northerly.

Kaminak also reported results Nov. 16 from the newly-recognized Latte zone, which is about 1.5 kilometers, or 1 mile, from the Supremo zone. Highlights include:

Latte trend yields 0.59 g/t gold over 35 meters (open to the south); 1.01 g/t gold over 10 meters and grab samples up to 2.35 g/t gold;

Mineralization encountered over 300 meters strike length, still open along trend and is hosted within a larger and untested gold-in-soil trend (Latte) known to extend for at least 1,000 meters by a width of up to 200 meters;

Gold is co-incident with a major structural trend and is associated with typical White District pathfinder elements arsenic and antimony; and

2009 soil sampling identifies new 700-meter-long untested gold-in-soil anomaly uncovered between the Supremo and Latte zones that is defined by gold-in-soil values ranging from 33 ppb gold to a high of 84 ppb gold.

"The Latte zone represents the second significant surface gold discovery identified on the Coffee property this year," said Carpenter in announcing results of the latest tests. "These results illustrate the potential of the property to host multiple drill targets for 2010."

Anomalous gold values on the Coffee property are associated with heavily bleached and weathered rock comprised primarily of sericite and quartz. This host rock is heavily altered; however, a progression from fresh rock can be observed within the trenches. Overall, gold values for the latest 34 samples ranged from below detection level to a high of 2.35 g/t gold. Trench sampling consisted of continuous chip samples over 5-meter intervals of oxidized and weathered rubble sub-crop that is interpreted as being near in-place.

Kaminak is also awaiting additional trench results from the Kona and Espresso gold-in-soil anomalies.

As the results of the 2009 program roll in, Kaminak is increasingly convinced that it is reading the tea leaves correctly about its Yukon claims. Further, the properties' close proximity to the White Gold properties bodes well for their potential, Carpenter told Mining News.

"Gold deposits tend to be close together," he said, observing that other gold districts in Canada have this characteristic. For example, one gold camp in northern Ontario has about 50 different gold mines.

Diamond drilling in 2010

Kaminak's management has approved plans for a minimum 5,000-meter phase 1 diamond drill program to begin in the spring or summer of 2010.

Though it is still early, Kaminak's Yukon prospects just to the east and southeast of the White Gold property appear to be highly prospective, said Mike Burke, senior geologists for the Yukon Geological Survey.

"It has a nice soil geochemical anomaly similar to the one on the Underworld property, and the trenching results are really good," Burke said. "But you need to drill to see the core. They are getting the 'truth machine' out on it next year, and that's when they will know if they have something there."

This will be the first-ever drill program on the Coffee property, and with about C$5 million in the bank, Kaminak is able to fund it through its existing treasury, Carpenter said.

"If we have a financial meltdown again - and some people are predicting it - we will still be able to do the Yukon program," he said.

Kaminak also reported progress this year on one of its two optioned properties in British Columbia, the Cry Lake gold-silver property located 80 kilometers northeast of Dease Lake, B.C., which is being explored by Solomon Resources Ltd.

Kaminak was awaiting results in early November from a late season drill program at Cry Lake, Carpenter said.

"The next step for us is perhaps Alaska," he said. "You have to get your toe in the water. That's what we did in Yukon this year. We will put two toes in next year, and we've started to look at proposals in Alaska."