The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Millrock options largely forgotten historic, high-grade gold mines in Southeast Alaska; explorer readies project for drilling
Millrock Resources Inc. has cut a deal to buy the Apex-El Nido property, home to two historical high-grade gold mines in Southeast Alaska that have largely been forgotten.
Located on Chichagof Island, about 70 miles southwest of Juneau and about the same distance northwest of Sitka, the Apex and El Nido mines churned out at least 17,000 ounces of gold from ore that averaged about 1.4 ounces per-ton gold during spurts of mining carried out between 1922 and 1940.
While very little modern exploration has been carried out to determine the extent of the high-grade gold systems that fed this historical production, Millrock has entered into a low-cost option that allows it to investigate the potential of the property without dipping too deep into its treasury.
By paying the property owner US$1,000 a year and spending another US$4,500 per year to keep the claims current, Millrock has three years to exercise an option to purchase 100 percent, royalty-free ownership of the historically high-grade gold property. And, under terms of the option, the sooner the exploration company makes its decision, the better.
Millrock can exercise the option to buy the property for C$100,000 until the end of March 2016; C$200,000 thereafter, until August 2016; C$400,000 thereafter, until August 2017; or C$500,000 thereafter, until August 2018.
Though miners dug out more than 17,000 oz of gold at the Apex and El Nido mines, the operations never achieved any kind of consistent production, due largely to the poor health of Captain John Cann, the founder and operator of the mine.
According to a number of historical accounts, most of the production at Apex-El Nido was carried out between 1921 and 1927, before Cann fell ill.
"Owing to his sickness, the property was not operated from 1928 to 1932. In 1932 the property was optioned by Condor Mining Co., which completed some work but gave up its option in the fall of the same year. In 1934 and 1935 the property was operated by the Apex-El Nido Mining Co. In 1936 the property was not operated, owing to Mr. Cann's death," the U.S. Bureau of Mines summarized in a 1941 report.
After a couple more years of sporadic operations, the high-grade gold mines sat idle for nearly four decades.
A surge in gold prices in the late 1970s sparked renewed interest in the Apex and El Nido deposits.
During this time, the U.S. Bureau of Mines examined and sampled the accessible areas of the mines. Samples collected from underground working of the Apex lode averaged about 1.9 oz-per-ton gold and samples from surface outcrops averaged about 4.57 oz/t gold. The El Nido vein, which is about 2,000 feet away from Apex, returned a slightly lower average but samples collected from outcrops ran as high as 24.2 oz/t gold.
Based on historical information, along with its own investigation, the U.S. Bureau of Mines calculated an indicated resource for the Apex vein of 25,168 oz of gold in 26,633 tons of material with an average grade of 0.945 oz/t.
The Apex vein system has been traced for about 2,000 feet to the southwest and the El Nido vein swarm has been traced for about 1,500 feet in a westerly direction. It has been suggested that these systems may converge.
In the mid-1980s, Echo Bay Mines followed up on this work with a mapping and sampling program that traced a vein swarm for more than 500 meters along strike. This zone, which is as much as 200 meters wide in places, contains mesothermal quartz veins carrying coarse, free gold associated with arsenopyrite and pyrite along with lesser amounts of copper, zinc and lead minerals.
Apex-El Nido has the potential for a significant high-grade gold deposit similar to others in Southeast Alaska, such as Coeur Mining's Kensington operation to the north, according to a report compiled by Avalon Development Corp., a Fairbanks based geological consulting firm.
Just 20 miles south of Apex-El Nido, the Chichagof Mine recovered 660,000 oz of gold and 195,000 oz of silver from about 600,000 tons of ore averaging 1.1 oz/t gold and 0.3 oz/t silver.
Sticking to its project generator model, Millrock plans to collect existing data and carry out a preliminary site investigation of the property. Once the company firms up targets, it will seek a partner to drill and hopefully renew operations at the nearly forgotten mines discovered by Cann.
Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.
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