The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Alaska-Northern BC- Yukon trilateral has large and high-grade projects set to deliver copper into the Green Energy Revolution North of 60 Mining News – April 30, 2021
A truckload of copper concentrates from the Minto Mine is being barged across the Yukon River on its way to the Skagway Ore Terminal in Southeast Alaska and then to world markets.
A drill expands on the copper-enriched mineralization at Dowa and Constantine Metal's Palmer project in Southeast Alaska.
Copper- and cobalt-rich mineralization from the Bornite deposit on Ambler Metals' Upper Kobuk Mineral Projects in Northwest Alaska.
High-grade copper mineralization from drilling into the Galore Creek project in Northern British Columbia.
Under this unassuming landscape in Southwest Alaska lies Pebble, which hosts one of the largest stores of copper on Earth.
Alaska, Northern British Columbia, and the Yukon are home to a dozen advanced stage exploration and mine projects hosting billions of pounds of copper ready to deliver to a world demanding massive amounts of this conductive metal for the green energy and electric mobility transition envisioned over the next three decades.
In its report, "Copper is the new oil," Goldman Sachs forecasts that the electrification of transportation and decarbonization of electrical generation alone will require 11.9 billion lb of copper per year by 2030 and there are not enough projects in the pipeline to meet this new demand.
And this demand is only expected to grow in the two decades to follow.
More details on the Goldman copper report and projected copper prices and demand can be read at A supercharged surge in copper prices in the current edition of North of 60 Mining News.
"I do not think anybody really appreciates just how much we need to do over the next 20 to 30 years," Contango ORE Inc. President and CEO Rick Van Nieuwenhuyse said during a recent webinar on mining in Alaska.
Having spent the better part of his 40-year career exploring mineral projects in Alaska, Northern BC, and the Yukon, he is very familiar with the copper potential of this Northern Copper Triangle and the work it takes to advance that potential to an operating mine.
The work it takes to unlock the massive copper potential this northern region has to offer is evidenced by the fact that despite hosting deposits with more than 110 billion pounds of copper in reserves or measured and indicated resources, only two mines – Red Chris in Northern BC and Minto in the Yukon – are currently shipping the world's "new oil" to global markets.
This could change as the demand for copper rises.
"The world's new 'green revolution' is predicated on reducing the use of fossil fuels and their related emissions and increasing new green energy use. Copper, also known as the green metal, will play an important part in this transition," Seabridge Gold Inc. Chairman and CEO Rudi Fronk penned into the intro of the company's annual report.
Seabridge's KSM and adjacent Snowfield projects in Northern BC happens to host nearly 17 billion pounds of the copper in Northern Copper Triangle projects with the potential to begin delivering the green energy metal to global markets by the end of the decade.
Northern BC set to deliver
KSM and Snowfield are two of five high-quality copper projects in Northern BC that contain more than 42 billion lb of copper that could help quell the supply-demand imbalance predicted by Goldman. This includes Red Chris, a mine that is already supplying global markets with the green energy metal and is positioned to deliver more in the coming years.
Owned under a joint venture between Newcrest Resources Ltd. (70%) and Imperial Metals Corp. (30%), the open-pit mine at Red Chris produced 88.3 million pounds of copper, along with 73,787 ounces of gold and 176,376 oz of silver during 2020.
The copper output at Red Chris, however, is expected to increase significantly when the operation transitions to block-cave mining, a bulk tonnage underground mining technique that involves starting at the bottom of the orebody and allowing the deposit to progressively collapse under its own weight.
In preparation for the completion of a feasibility study for a block cave mine, Newcrest updated the Red Chris resource.
According to this calculation, Red Chris hosts 310 million metric tons of open pit mineable measured and indicated resources averaging 0.34% (1 million metric tons) copper and 0.28 g/t (2.7 million oz) gold; and 670 million metric tons of underground measured and indicated resources averaging 0.4% (2.7 million metric tons) copper and 0.46 g/t (10 million oz) gold.
What this new resource and block cave mining will mean for copper output at Red Chris will be better understood with the completion of a prefeasibility study, which is slated for September.
Newcrest plans to begin block cave mining in the next five or six years.
About 70 miles (115 kilometers) southwest of Red Chris lies Galore Creek, an even larger and higher-grade copper project that could be brought into production in time to help build the low-carbon future.
According to a 2018 calculation, Galore Creek hosts 1.1 billion metric tons of measured and indicated resources averaging 0.47% (11.3 billion lb) copper, 0.26 g/t (9.3 million oz) gold, and 4.2 g/t (150 million oz) silver.
"Of all the deposits in BC, Galore Creek is heads-and-shoulders better grade," said Van Nieuwenhuyse, former president and CEO of Novagold Resources Inc., a company that played a pivotal role in advancing the project to the near development stage.
A feasibility study completed about a decade ago, and before Novagold sold its half of Galore Creek to Newmont Corp., envisioned a mine that would produce 6.2 billion lb of copper over an 18-year span.
Galore Creek Mining Company, a joint venture owned equally by Teck Resources Inc. and Newmont, is collecting the final bits of data to complete an updated prefeasibility study for developing a mine at this world-class deposit.
While the Teck-Newmont partnership may consider new options for Galore Creek, the roughly 344-million-lb-per-year output outlined in the 2011 study provides some perspective of the Galore Creek potential.
Teck also holds a 75% stake in Schaft Creek, a porphyry copper-gold deposit about 19 miles (30 kilometers) northeast of Galore Creek.
According to a calculation completed earlier this year, Schaft Creek hosts 1.35 billion metric tons of measured and indicated resources averaging 0.26% (7.76 billion lb) copper, 0.17 g/t (7 million ounces) gold, 1.25 g/t (54.3 million oz) silver, and 0.017% (510.6 million lb) molybdenum.
Copper Fox Metals Inc., which owns the other 25% of Schaft Creek, says the updated resource is being used to prepare a preliminary economic assessment that evaluates a 133,000-metric-ton-per-day mill and open pit mine at Schaft Creek, which is slightly larger than the operation outlined in a 2013 feasibility study.
The operation detailed in the earlier study was forecast to produce 4.88 billion lb of copper, 4.21 million oz of gold, 25.1 million oz of silver, and 214.9 million lb of molybdenum over a 21-year mine life.
In addition to a larger mill, the coming PEA will include changes in financial assumptions and metals prices over the eight years since the completion of a feasibility study for Schaft Creek.
While primarily valued for its gold content, Seabridge's KSM project hosts the largest store of copper discovered so far in Northern BC.
According to a 2019 resource calculation, KSM hosts 2.98 billion metric tons of measured and indicated resources averaging 0.52 g/t (49.7 million oz) gold, 0.21% (13.9 billion lb) copper, 2.8 g/t (265 million oz) silver, and 54 parts per million (312 million lb) molybdenum.
A 2020 updated preliminary economic assessment envisions a combined open pit and block cave mining operation at KSM that would produce 17 billion lb copper and 27.6 million oz gold over a 44-year mine life, or roughly an average 386.4 million lb of copper and 627,000 oz of gold per year.
This operation does not consider Snowfield, which Seabridge acquired from Pretium Resources Inc. at the end of 2020.
Lying immediately east of the Mitchell deposit at KSM, Snowfield hosts 1.37 billion metric tons of measured and indicated resources averaging 0.59 g/t (25.92 million oz) gold, 1.72 g/t (75.8 million oz) silver, 0.1% (2.98 billion lb) copper, 85.5 parts per million (258.3 million lb) molybdenum, and 0.51 ppm (22.5 million oz) rhenium.
"Work is already underway to integrate Snowfield into a new KSM mine plan," Fronk penned in an annual report published by Seabridge on April 22.
The Seabridge Gold chairman says the addition of Snowfield is already attracting the attention of mining companies interested in the massive amount of copper, gold and silver offered by the KSM-Snowfield combination.
In addition to these more advanced projects, Northern BC hosts several earlier staged copper properties with the potential to offer a second wave of copper to a green energy transition that is expected to take about three decades to complete.
Newmont's newly acquired Tatogga property is one such prospect. Located about 12.5 miles (20 kilometers) northeast of Red Chris, the Saddle North deposit at Tatogga hosts 298 million metric tons of indicated resource averaging 0.28% (1.81 billion lb) copper, 0.36 g/t (3.47 million ounces) gold, and 0.8 g/t (7.58 million oz) silver; plus 543 million metric tons of inferred resource averaging 0.25% (2.98 billion lb) copper, 0.31 g/t (5.46 million oz) gold, and 0.7 g/t (11.64 million oz) silver.
Minto and more in the Yukon
While the quantities are a bit more modest, Canada's Yukon is also delivering copper to global markets and has projects advanced enough to potentially supply more in the coming decade.
Minto, the one operating copper mine in the Yukon, was acquired in part by United Kingdom-based Pembridge Resources plc in 2019.
The processing plant at Minto has historically produced roughly 40 million pounds of copper per year in concentrates that also contain gold and silver byproducts.
Pembridge is still ramping this mine back up to its full capacity and expects to resume commercial production this year.
The copper concentrates from Minto are currently being shipped to Sumitomo Corp. in Japan.
Being advanced by BMC Minerals Ltd., another company with strong UK ties, the Kudz Ze Kayah (KZK) project in the southeastern region of the territory has the potential to be the next source of Yukon copper.
While considered primarily as a high-grade silver project, the volcanogenic massive sulfide mineralization at KZK has strong copper, zinc, and gold byproduct credits.
A feasibility study updated late last year details a mine at KZK that is expected to produce an average of 235 million lb of zinc, 32 million lb of copper, 56 million lb of lead, 7.8 million ounces of silver and 56,500 oz of gold annually, over an initial nine-year mine life.
This operation is based on 15.7 million metric tons of probable reserves averaging 5.8% (915,000 metric tons) zinc, 0.9% (135,800 metric tons) copper, 1.7% (265,700 metric tons) lead, 138 g/t (69.5 million oz) silver, and 1.3 g/t (666,000 oz) gold.
BMC has previously targeted delivering the first KZK concentrates to global markets by 2023 but the permitting process has been held up due to the federal government delaying approvals of the permits needed to begin development.
The Yukon Environmental and Socioeconomic Assessment Board has resubmitted its recommendation that permits for a mine at KZK should be approved – the territorial government has said it will approve those permits and BMC is awaiting the federal government's decision.
While not as advanced, Western Copper and Gold Corp.'s Casino project in the Yukon has the potential to deliver greater quantities of the copper required for the renewable energy and EV revolution.
A feasibility study completed in 2013 envisioned utilizing both a mill and heap leaching to recover the copper, gold, silver, and molybdenum found at Casino. Western Copper, however, has more than doubled the size of the Casino deposit since that study was completed.
According to a 2020 calculation, Casino hosts 2.17 billion metric tons of millable measured and indicated resources averaging 0.16% (7.43 billion lb) copper, 0.18 g/t (12.7 million oz) gold, 1.4 g/t (100.2 million oz) silver, and 0.017% (811.6 million lb) molybdenum; plus 217.4 million metric tons of heap leach measured and indicated resource averaging 0.03% (166.5 million lb) copper, 0.25 g/t (1.8 million oz) gold, and 1.9 g/t (13.3 million oz) silver.
"This resource and the results of this year's drilling program will be incorporated in an updated feasibility study in the future," Western Copper and Gold President and CEO Paul West-Sells said in mid-2020.
A PEA slated to be completed around mid-year will be the first step toward a study of the viability of Casino delivering copper into a market demanding unprecedented quantities of the conductive metal.
Perfect storm in Alaska
While Alaska does not currently have a copper producing mine, it is a past supplier of this critical electric conductor and has more than 60 billion lb of the new oil ready for delivery in the coming years.
With the renewable energy revolution steering energy and transportation away from petroleum, a cornerstone of Alaska's economy, the state needs to consider alternate sources of jobs and revenue.
"There is kind of the perfect storm brewing here," Van Nieuwenhuyse told Mining News. "If the long-term view is to reduce our dependence on oil and gas, Alaska needs to start planning on what that future is going to look like."
Fortunately, the state hosts world-class deposits of copper, graphite, and other metals and minerals needed for the energy transition.
By far the largest deposit of copper in Alaska, however, is locked up in one project fighting an uphill battle for regulatory approvals.
This world-class project is Pebble, which hosts one of the largest stores of this new oil on Earth.
According to the most recent calculation, Pebble hosts 6.5 billion metric tons of measured and indicated resources averaging 0.4% (57 billion lb) copper, 0.34 g/t (71 million oz) gold, 240 ppm (3.4 billion lb) molybdenum, 1.7 g/t (345 million oz) silver, and 0.41 ppm (2.6 million kg) rhenium.
The Southwest Alaska deposit hosts another 25 billion lb of copper in the lower confidence inferred resource category.
Pebble, however, has been roiled in controversy due to its proximity to the Bristol Bay watershed and the world-class salmon fishery found there.
Proponents argue that a modern mine at Pebble could coexist with the fishery and deliver the copper and other metals the world needs. The opposition, however, says the Bristol Bay region is too unique to take a chance.
In November, the U.S. Army Corps of Engineers denied the federal permits needed to move ahead with development of a mine at Pebble expected to produce 5.74 billion lb of copper, 6.4 million oz of gold, 260 million lb of molybdenum, and 32 million oz of silver over a 20-year mine life.
Arguing that this decision is contrary to the law and the Army Corps' own findings, Pebble Limited Partnership, the company advancing this world-class deposit, has appealed the federal agency's record of decision.
"The FEIS (final environmental impact statement) found that the project can be developed without damage to the Bristol Bay fishery, a finding that was mostly ignored in the decision to deny Pebble a permit," said Pebble Partnership CEO John Shively.
Pebble is not the only advanced exploration project in Alaska that has healthy quantities of critical byproduct metals.
Not quite as large as Pebble but less controversial and much higher grade, the Bornite and Arctic deposits in the Ambler Mining District of Northwest Alaska host roughly 9 billion lb of copper, along with other base, precious, and critical minerals.
Ambler Metals LLC, a joint venture operating company equally owned by Trilogy Metals Inc. and South32 Ltd., is advancing the exploration, permitting, and future development of these and more than a dozen other copper-enriched projects across their Upper Kobuk Mineral Projects (UKMP).
Arctic, which is in the early stages of permitting, hosts roughly 2.5 billion lb of this copper.
A 2020 feasibility study for Arctic detailed plans for a mine that is slated to produce an average of more than 155 million lb of copper, 192 million lb of zinc, 32 million lb of lead, 32,165 oz of gold, and 3.4 million oz of silver per year over a 12-year mine life.
The largest copper prize identified so far in the Ambler Mining District, however, is Bornite.
According to the most recent resource calculation, Bornite hosts roughly 6.4 billion lb of copper and 77 million lb of cobalt, a critical metal used in the lithium-ion batteries powering EVs and storing zero-carbon electricity when the sun is not shining or wind not blowing.
Bornite also carries at least two other critical minerals – germanium and gallium – though the concentrations and recoverability of these technology metals have yet to be determined.
Ambler Metals currently envisions Bornite as the second mine to be developed at UKMP.
From large bulk tonnage projects similar to Pebble to smaller but higher-grade projects more akin to Arctic and Bornite, Alaska has a handful of other copper projects that could be seeking the permits needed for development in the coming years.
Amongst the most promising are Palmer and Niblack, similar VMS style projects in Southeast Alaska.
Being advanced under a joint venture between Dowa Metals & Mining Alaska Ltd. and Constantine Metal Resources Ltd., the Palmer project at the north end of the Southeast Alaska Panhandle hosts 4.68 million metric tons of indicated resource averaging 1.49% (154 million lb) copper, 5.23% (539 million lb) zinc, 30.8 g/t (4.6 million oz) silver, 0.3 g/t (451,000 oz) gold, and 23.9% (1.12 million metric tons) barite.
A 2019 PEA outlined plans for an underground mine at Palmer that would produce 1.07 billion lb of zinc, 196 million lb of copper, 18 million oz of silver, 91,000 oz of gold and 2.89 million metric tons of barite over an initial 11-year mine life.
Blackwolf Copper and Gold Ltd.'s (formerly Heatherdale Resources) Niblack project at the southern end of the panhandle hosts 4.14 million metric tons of indicated resource averaging 0.95% (118.1 million lb) copper, 1.73% (215 million lb) zinc, 1.75 g/t (317,220 oz) gold and 29.5 g/t (5.4 million oz) silver.
While smaller in terms of the potential to supply global demands, projects like Palmer and Niblack have the advantage of being nimble enough to potentially be a source of copper for a world that is rapidly transitioning to electrified transportation and zero-carbon energy.
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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