The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
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President and CEO: Victor Wyprysky
Chief Operating Officer: Keith Boyle, P.Eng, MBA
Executive Vice President: Terrance Chandler, P. Geo
Chieftain Metals Inc., a minerals exploration company that went public in December , has its sights set on re-opening the Tulsequah Chief Mine, a precious metals-rich volcanic massive sulfide deposit on British Columbia's western border about 65 kilometers (40 miles) northeast of Juneau.
In his former role as CEO of Redfern Resources Ltd., Chieftain Metals Executive Vice President Terrence Chandler spent some 20 years working on exploration, permitting and development of the Tulsequah Chief Project.
Unable to survive a period of financial and regulatory uncertainty, Redfern, and parent company Redcorp Ventures Ltd., filed for bankruptcy in the Supreme Court of British Columbia in 2009.
Chieftain Metals closed a deal to buy the defunct project's assets in September, giving Chieftain a clear title to 13 mineral claims, 25 crown-granted claims and four fee-simple lots that make up the Tulsequah property.
In January, the junior closed an initial public offering on the Toronto Stock Exchange, grossing some C$20 million for the young company, including proceeds of an over-allotment.
Chieftain Metals' first task as owner of Tulsequah Chief is to install a plant to treat the acidic metal-laden water flowing from historic copper-gold-silver-zinc-lead mines on the property, which has sat idle since Cominco Ltd. shut down production in 1957.
In October Chieftain reported that the treatment plant was 85 percent complete and is expected to be operational in November.
The balance of a C$10 million phase-1 work program in 2011 at Tulsequah Chief focused primarily on exploration of the 14,220-hectare (35,123-acre) property.
The Tulsequah deposit has an indicated resource of 6 million metric tons grading 1.42 percent copper, 6.44 percent zinc, 1.23 percent lead, 2.63-grams-per-metric-ton gold and 96 g/t silver.
In addition, the deposit contains an inferred resource of 1.1 million metric tons grading 0.94 percent copper, 5 percent zinc, 0.93 percent lead, 1.63 g/t gold and 72 g/t silver.
Big Bull, a deposit about 8 kilometers (5 miles) southeast of Tulsequah contains a smaller resource.
Chieftain completed a preliminary economic assessment in June using a 2007 feasibility study as the technical basis.
The PEA outlined the potential for 69,400 gold-equivalent ounces of production annually at a total cash cost (net of base metal by-product credits) of negative US$365 per gold-equivalent ounce, based on 2,000 metric tons per day over a 9-year mine life.
In September Chieftain announced it has engaged Wardrop Engineering to complete a new feasibility study for Tulsequah that will update the construction execution plan and incorporate current capital and operating costs.
Updated mine reserves that include some 21,000 meters of drilling completed in 2011 will be included with the study.
One of the big hurdles that Chieftain Metals must overcome is getting metal concentrates to market.
The revised plan will includes an access road connecting the project to the British Columbia road system.
Chieftain's website depicts an overland route that would connect the project to the town of Atlin, B.C. about 155 kilometers (96 miles) to the north.
Completion of the feasibility study is expected in the first quarter of 2012, and will form the basis for initiating construction of the Tulsequah Chief project later in the year.
Cash and short-term deposits:
C$12.29 million (June 30, 2011)
Working capital: C$5.22 million (June 30, 2011)
Market capitalization: C$51.07 million (Sept. 23, 2011)
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