The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Reunited Kaminak team to drill three enticing gold properties North of 60 Mining News – May 17, 2019
Tectonic Metals Vice President of Exploration Eric Buitenhuis prospecting the Seventymile gold property in Alaska.
While enormous tracks of claims have been staked across Yukon's section of the Tintina Gold Belt, much of this province remains open on the Alaska side of the border.
Road Metal, a silver-gold prospect on the Northway property discovered intrusive rocks with up to 135 oz/ton silver and 2.51 oz/ton gold in a gravel pit along the Alaska Highway.
Tectonic Metals Inc. plans to leverage Alaska's underexplored gold potential to create "the number one mineral exploration company in the world."
While this is a lofty goal, Tectonic Metals is led by an executive team that is renowned for the mineral exploration, mining and business skills required to achieve the company's vision.
Tony Reda, former vice president of corporate development of Kaminak Gold Corp., is the president and CEO of Tectonic Metals. He is joined by Eira Thomas and Rob Carpenter, both former president and CEOs of Kaminak.
While with Kaminak, this team advanced the Coffee project in the Yukon from a grassroots discovery to a roughly 5-million-ounce gold mine project that Goldcorp Inc. (now Newmont Goldcorp) acquired in 2017 for C$520 million.
"Now that we had a taste of what it takes to discover and advance a multi-million-ounce gold district, we are hungrier than ever to not only do it again, but to do it better on every front imaginable," said Reda.
This ravenous and highly respected exploration team has joined forces with Curt Freeman, a renowned Alaska geologist and owner of the Fairbanks-based Avalon Development Corp., to form a new company that could create a tectonic shift in the gold exploration game.
"It was clear from day one that Eira, Rob, Curt and I shared a passion for mineral exploration and discovery and the desire to bring something different to the mineral industry. Tectonic was the answer," Reda said.
The shift began with low rumblings last year, as the privately held Tectonic began quietly accumulating and carrying out early stage exploration on highly prospective, yet underexplored gold properties in eastern Alaska last year.
The real Tectonic movement, however, is expected to follow the company's listing on the TSX Venture Exchange and completion of a C$5 million financing currently underway.
"The funds from the offering will contribute to advancing four high potential gold projects, where up to three projects will be drill tested this year," said Thomas.
All three properties targeted for drilling this year – Tibbs, Seventymile and Northway – are found in eastern Alaska. The fourth, which needs more mapping and sampling before its ready for drill testing, is the MCQ gold property in central Yukon.
Why Alaska?
While the Tectonic Metals team has a fondness for the Yukon and a high regard for the vast gold potential there, they have decided to center their exploration focus west of the "Border Fault," a political structure that separates the now crowded Klondike and White Gold Districts in the Yukon from largely overlooked eastern Alaska.
"Alaska has always intrigued us, and that political border is by no means a geological border," Reda told Mining News.
Transcending this border is the Tintina Gold Belt, a 125- by 750-mile gold-rich province that hosts several multi-million-ounce gold projects and mines such as Donlin Gold, Livengood, Fort Knox and Pogo in Alaska, as well as the Coffee and Golden Saddle deposits in Yukon's prolific White Gold District.
Though the political border was established roughly 100 million years post-mineralization, it does come into play when Canadian-listed mining companies decide where they will get the most value per exploration dollars spent.
While it is much more favorable for mining companies to establish their headquarters and raise money in Canada, an exchange rate of C$1 to US74 cents makes it expensive for those companies to invest on the Alaska side of the border.
Flow-through financing is another Canadian advantage that keeps exploration companies from moving west of the border fault.
Under a provision of Canada's Income Tax Act, flow-through financings allow exploration companies to transfer exploration expenses to individual investors that purchase the flow-through shares. The flow-through investor, in turn, can apply his portion of the exploration expense to reduce or eliminate his tax liability.
The exploration company, in turn, must spend the flow-through dollars raised on qualifying mineral projects in Canada within two years of closing the financing.
These economic advantages of investing in Canada, coupled with the exciting gold discoveries made by Kaminak and a wide array of other junior and major mining companies have resulted in a bustle of exploration on the Yukon side of the border, while it remains relatively quiet on the Alaska side.
"For guys like us, looking for district-scale deposits, it was pretty crowded to get into the Yukon," Reda said.
In addition to being vastly underexplored, Alaska has a number of other compelling advantages that play into Tectonic's decision to initially focus its exploration there:
• familiar and prospective geology;
• district-scale potential;
• compelling gold grades;
• and great infrastructure.
Reda said one of the biggest advantages is the opportunity to work directly with an Alaska Native corporation. In fact, Tectonic's two largest assets in Alaska – Northway and Seventymile – are being explored under an agreement with Doyon Inc., the Alaska Native regional corporation for Interior Alaska.
The agreement with Doyon covers all phases of mining – mineral exploration, mine development and production – meaning that further negotiation will not be necessary later.
"We have engaged early and developed key relationships with all of our stakeholders and First Nations partners with a commitment to maximizing value for the communities in which we live and work," said Thomas.
A highway runs through it
Northway is the prime example of why Tectonic is so excited about Alaska.
Located less than 70 miles (110 kilometers) west of the Coffee Gold Mine project in the Yukon, Northway is a large land package that covers a 25-mile- (40 kilometers) long gold belt in terrane Tectonic is familiar with.
What makes this property even more remarkable is it has seen almost no exploration in two decades, despite the paved Alaska Highway running through its length.
"We are going into a jurisdiction where the rocks are the same and we have a highway trucking right through our property – an actual highway!" Reda told Mining News.
Tectonic said stream sediment, soil and rock sampling completed during its 2018 program validated structurally hosted gold occurrences previously identified on the property.
As a result, two targets on the property – Area 6 and Area 7 – are ready to be drilled.
Area 6, situated toward the northwest end of the property, hosts a 1,200-meter-long soil anomaly that has returned samples with as much as 597 parts per million copper and 253 parts per billion gold.
The elevated copper and gold in the soils is coincident with induced polarization (IP) and magnetic anomalies that provide a clear drill target at Area 6.
The Tectonic team is also excited about Area 7, an 800-meter-long gold-in-soil anomaly toward the southeast end of the Northway property.
Sampling carried out last year returned assays with as much as 2.12 grams per metric ton gold, which is exceptionally high for soil sampling.
Area 7 also has a coincident geophysical anomaly that will guide drilling, this time a magnetic feature covering a 3,000-by-5,000-meter area.
"Area 6 and Area 7 are still open for expansion – we still want to get a sense of scale, on surface at least," Reda told Mining News.
To get a better idea of the scale and further refine the targets, the company plans to carry out additional work prior to drilling.
This includes testing the use of a GT Probe, a track-mounted rig that drives a cased hole through the soil to collect a sample from the soil-bedrock interface more efficiently and with less surface disturbance than the trenching traditionally used to get such a sample.
This rig, designed and built by Dawson City-based GroundTruth Exploration, has proven to be an efficient tool for exploration in the Yukon but has yet to be used in Alaska.
The Tectonic team from Kaminak worked with GroundTruth and witnessed the effectiveness of the GT Probe at the Coffee project and are looking forward to using this innovation in Alaska.
Once the preliminary work is done, the company plans to carry out oriented core drilling on both targets at Northway before the end of the year.
New Seventymile model
Situated between Yukon's Klondike District to the east and Alaska's Circle Mining District to the west, Seventymile also blankets a 25-mile-long gold trend that has not been explored for two decades.
While some 83 historical holes tested seven prospects across Seventymile, Tectonic Metals believes these holes targeted the wrong style of mineralization.
"The previous explorers applied a Motherlode, California model to this property. We are looking at it from a structural, high-grade shear zone lens," Reda said.
With power auger sampling across the interpreted shear zone returning highly anomalous gold, the company has taken a step towards validating this theory.
The next step will be to get some top-of-bedrock samples with a GT Probe.
Flume is a 7,000-meter-long trend on the Seventymile that could host the high-grade shear zones Tectonic is looking for. Historical drilling along this trend did not test for the lithological contacts – where two rock types come together – that could provide channels for the gold-rich fluids to form deposits.
In addition to looking for these sheer zones at Flume, the GT Probe will expand Flanders, a Seventymile prospect where past drilling cut as much as 8.6 g/t gold over 4.9 meters.
Dependent on the results from the GT Probe work, the company plans to follow up with roughly 15 rotary air blast holes across the shear zone and at other Seventymile targets.
Pogo analogue
Probably the most advanced Tectonic project is Tibbs, a high-grade gold property that has many similarities to Northern Star Resources' Pogo gold mine property about 20 miles to the west.
Past exploration at Tibbs, referred to as Rob by previous explorers, has turned up some very high-grade gold showings at surface, just the kind of project Tectonic Metals is looking for.
"I will take high-grade gold at surface to drill any day of the week," Reda said.
While Tibbs had shown high-grade gold potential, intermittent exploration since the discovery of Pogo has not turned up a cohesive deposit there.
Tectonic believes that the reason for this lack of discovery is past exploration was seeking the type of flat lying veins that has provided the bulk of the gold at Pogo, not the higher-grade vertical feeder veins more recently found around the mine.
"This property still has not been tested from that perspective," Reda said, referring to the search for the vertical veins
Tectonic said the geochemical signature and age of mineralization at Tibbs is very similar to Pogo but a Pogo analogue is not driving its interest in the property.
"If you put this project somewhere else in the world and forgot about Pogo, at the end of the day you have a high-angle vein here that carries extremely high-grade material," Reda said.
Since acquiring the property in 2017, Tectonic Metals has advanced Tibbs to the drill-ready stage. This work includes mapping, sampling, trenching and a property-wide geophysical survey.
Results from this work have provided the company with a better understanding of the known mineralization and led to the discovery of a new gold zones.
Trenching at one of the new zones the company dubbed Connector encountered six meters of 8.1 g/t gold and 13 meters of 1.5 g/t gold. Rock samples collected directly on strike of the trenches contained 32.3 and 17.4 g/t gold.
Connector is about 300 meters east of Grey Lead, a previously known target at Tibbs.
Drilling completed at Grey Lead in 2007 and 2008 cut 5.7 meters of 19.14 g/t gold, 5.3 meters of 15.76 g/t gold, 4.26 meters of 6.13 g/t and two meters of 16.42 g/t gold.
Trenching completed by Tectonic encountered similar widths and grades, including five meters of 38 g/t gold and eight meters of 14.8 g/t gold.
Previous shallow drilling has traced Grey Lead to a depth of approximately 50 meters and for about 250 meters along strike. Tectonic said the mineralization is open in both directions.
Hilltop-Oscar, an undrilled target north of Grey Lead, indicates the potential to further expand the high-grade gold mineralization. Rock samples collected from Hilltop-Oscar have returned grades as high as 75.6 g/t gold.
When combined with the new prospects identified last year, the Grey Lead area extends for some 1,000 meters along strike.
About 3,000 meters northeast of the Grey Lead area lies Michigan, a 1,000-meter-long mineralized corridor where rock samples contained as much as 900 g/t (28.9 ounces per metric ton) gold.
Three trenches dug by Tectonic last year – 3.3 meters of 11.5 g/t gold, six meters of 1.96 g/t gold and eight meters of 1.01 g/t gold – confirms mineralization along the trend
One hole drilled in 2011 to test a deep geophysical anomaly at Michigan cut 1.57 meters of 57.21 g/t gold and 9.14 meters of 2.58 g/t gold.
Johnson Saddle is another Tibbs target the company plans to drill next year.
Located on a plateau in an area previously not well known, Johnson Saddle is a bit of an enigma.
Trenching at Johnson Saddle encountered eight meters of 1.7 g/t gold in a new style of mineralization that does not fit the Pogo analogue.
"This is not vein-style mineralization – it is intensely altered and is sitting on top of a plateau. It definitely warrants more work," said Reda.
Tectonic plans to use rotary air blast drilling at the earlier staged Tibbs targets, which will provide a cost-effective means of better understanding the geology, and oriented core drilling to test the Grey Lead vein system.
Vision for the future
The company's vision for the future is as large as the potential of its Tintina Gold Belt portfolio.
"At Tectonic, our vision is simple – to be the number one mineral exploration company in the world. Now is the time for us to share that vision, passion and enthusiasm with the world on a larger stage," said Reda.
For investors, this provides an opportunity to get in early on a new gold exploration company with a leadership team that has already taken one Tintina Belt Gold property from grassroots to a half-a-billion-dollar sale.
"Exploration is the lifeblood of the mining industry, and where the most value can be leveraged for shareholders, through the success of discovery," said Thomas, "Tectonic brings together a strong, experienced team and top tier assets in highly rated, underexplored, first world jurisdictions."
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.
Reader Comments(0)