The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
With gold price nearly 600% higher, reprocessing 2000-era heap leach material, mining new ore is a compelling prospect North of 60 Mining News – July 31, 2020
Testing the heap leach pad during the 2020 drill program at the past producing Illinois Creek gold-silver mine in Alaska.
Western Alaska Copper & Gold CEO Kit Marrs takes notes during the 2016 drill program at Round Top, a copper-gold target about 10 miles northeast of the Illinois Creek Mine site.
As the price of gold reaches historic highs and silver tops US$24 per ounce, Western Alaska Copper & Gold and Piek Exploration are investigating the potential of restarting operations at the past producing Illinois Creek Mine near the Yukon River about 65 miles southwest of the town of Galena and 120 miles north of the Donlin Gold Mine project.
In 2018, Western Alaska Copper & Gold and Piek Exploration formed a joint venture to consolidate the entire Illinois Creek district, this 34,240-acre land package blankets the past producing Illinois Creek gold-silver mine; Round Top, a porphyry copper-molybdenum-silver deposit; and Honker, a high-grade gold target; and Water Pump Creek, a carbonate replacement zinc-lead-silver deposit.
"One of the many strengths of the Illinois Creek district is the presence and ongoing discovery of a series of deposits with varying metals. This gives WAC&G the flexibility to focus on what's economically robust at any given time," said Western Alaska Copper & Gold CEO Kit Marrs.
Most of Western Alaska Copper & Gold's exploration over the previous six years has focused on advancing the Round Top copper deposit, where the company plans to publish an initial resource estimation in the coming year.
With precious metals prices on the rise and the past producing Illinois Creek Mine providing the shortest path to production, following the formation of the Illinois Creek joint venture with Piek, Western Alaska Copper & Gold shifted its attention to realizing the precious metals potential the consolidated property has to offer.
"Our current focus is solely on advancing the Illinois Creek gold deposit and exploring potential synergies with the adjacent high-grade Honker gold vein," Marrs said.
Compelling gold mine
Illinois Creek produced an estimated 150,000 oz of gold and 500,000 oz of silver during three years of mining between 1996-2002. This includes mining carried out by USMX-Dakota Mining from 1996 to 1998 and Viceroy Resource Corp. from 1998 to 2000.
While these companies ran into hardship when gold prices dipped below US$300 per ounce, ARG Group leased the mine from the state of Alaska and was able to continue operations long enough to pay for the closure and reclamation of the mine in 2002, and put nearly US$850,000 in a fund to support monitoring of the site.
This abbreviated operation left plenty of gold and silver behind. Considering that an ounce of gold is selling for nearly seven times the $280/oz average in 2000, picking up where past mining left off is a compelling prospect.
According to a resource calculation completed last year, 6.76 million metric tons of indicated resource averaging 1.04 grams per metric ton (226,000 oz) gold and 34.3 g/t (7.5 million oz) silver; plus 2.03 million metric tons of inferred resource averaging 1.06 g/t (70,000 oz) gold and 38.8 g/t (2.5 million oz) of silver has been outlined so far beneath the previously mined pit at Illinois Creek.
This does not count gold and silver remaining on the heap-leach pad, which could provide additional material for a restart of operations.
The historical heap leach operation was designed for gold recovery with little emphasis on silver and copper. As a result, it is estimated that roughly 80,000 oz of gold and 3 million oz of silver, along with an unknown amount of copper remain in the roughly 2.25 million metric tons of material on the existing leach pad.
"Sampling the leach pad is key to advancing the value of the Illinois Creek deposit," said Joe Piekenbrock, founder of Piek Exploration and Western Copper & Gold's chief exploration officer. "The ability to jump start a mining operation with existing run-of-mine material with these values is a real plus, and could potentially provide funding for the initial capital costs."
Western Copper & Gold is current carrying out a 72-hole reverse circulation with casing advance drill program to gain a better understanding of the quantities of gold, silver, and copper on the heap leach pad. Samples collected during this roughly 620-meter program will also be used for metallurgical testing to determine the optimum process for recovering these metals.
"The goal of the metallurgical work is to develop a processing plant design which will incorporate traditional CIL (carbon-in-leach) recovery for gold, with a Merrill Crowe and SART (sulfidization, acidification, recycling and thickening) process designed for enhanced silver and copper recovery, respectively," said Marrs. "This combination should result in greatly enhanced metal recoveries and project economics."
Additional work, including a 750-meter resource conversion drill program in the Illinois Creek Central and West pits and drilling to expand the oxide gold-silver resource along strike of the Illinois Creek structure are planned this summer.
"We're on a fast track for completing our PEA this year and moving to the pre-feasibility and permitting stages in 2021," said Marrs. "In addition to the over 550 drill holes in our database, we've uncovered a terrific amount of historical data from the mine development and mine operation."
Beyond Illinois Creek
In addition to advancing Illinois Creek toward the permitting stage, Western Alaska Copper & Gold is considering drilling at Honker, a potential source of high-grade gold ore about six miles north of Illinois Creek.
The main vein at Honker is about one to five meters thick and has been traced for about 800 meters along strike. This vein was historically drilled with 10 holes. While the recoveries from the historical drilling were poor, these holes encountered grades of up to 34.8 g/t gold and 72.5 g/t silver.
Historical bulk samples collected from Honker averaged 26.5 g/t gold and 26.8 g/t silver. Metallurgical testing of this material produced a column heap leach recovery of 82% and 92% for agitated leach. Combined, these indicate Honker could be a good source of satellite ore for Illinois Creek.
While Western Alaska Copper & Gold is focused on the precious metals targets at Illinois Creek, the company did complete 1,536 meters of infill drilling during the 2019 program at Round Top, a large porphyry copper-gold deposit about 10 miles northeast of the Illinois Creek Mine that first drew geologists to the area in 1980.
Marrs, a project geologist for Anaconda Copper Company at the time, and his wife Joan were involved with the original discovery at Round Top and then the wider Illinois Creek district.
In recent years, Western Alaska Copper & Gold has completed 9,933 meters of drilling in 40 holes at Round Top.
Highlights from 2016 to 2018 drilling at this porphyry copper-gold target include:
• 64.7 meters of 0.65% copper-equivalent in RT-18, including 31.6 meters of 0.9% copper-equivalent.
• 166 meters of 0.51% copper-equivalent in RT-19, including 28.7 meters of 1% copper-equivalent.
• 209.7 meters of 0.28% copper-equivalent in RT-23, including 37.4 meters of 0.63% copper-equivalent.
• 64 meters of 0.74% copper equivalent in RT-32.
The company plans to compile the results from drilling at Round Top into a maiden resource for the copper-gold deposit in the coming year.
The Illinois Creek district also hosts undrilled skarn deposits proximal to Round Top, as well as zinc-lead-silver targets. One zinc-rich target just northeast of the Illinois Creek Mine, Waterpump Creek, hosts 166,000 tons of historical resource averaging 16.1% zinc, 5.5% lead and 9.5 g/t silver. A similar replacement style deposit lies northwest of Round Top.
While these provide some compelling targets for future exploration, the potential to resume mining the gold and silver remaining on the heap leach pad and below the previously mined pit at Illinois Creek, along with the high-grade gold coming to the surface at Honker, provide too good a prospect to pass up.
"We're ready to capture this upturn in the gold market and take advantage of the opportunity laid out before us," Kit said.
EDITOR'S NOTE: This article was updated on July 31 to reflect continued increases in the price of silver. The print and pdf verison stated the price of silver at "nearly US$23 per ounce", which has risen to above US$24 since the article was originally written.
CORRECTION: A previous version of this article stated that "Illinois Creek was Alaska’s first heap leach gold mine." This distinction belongs to Citigold Mining Company's Ryan Lode Mine a few miles north of Fairbanks, which operated in the late 1980s.
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)