Minerals hunt in NWT turns 'critical'

Mining activity in Northwest Territories held steady in 2022 despite constraints imposed by the ongoing COVID-19 pandemic as a cadre of mainly junior mining companies took up the international challenge to seek out large deposits of critical minerals.

Early in the year, government officials noted that industry interest in diamonds, gold, and especially critical minerals boded well for the NWT economy in the coming year.

"An exciting new chapter is emerging for mining in the NWT," said Caroline Wawzonek, minister of Industry, Tourism, and Investment for Northwest Territories.

"While global competition for investors is fierce, we are well-positioned to not only become a supplier of critical minerals, but to be a leader in how they are resourced in both an environmental and socially responsible way," Wawzonek told a Toronto audience at the Prospectors & Developers Association Conference in June.

More than half of the 31 critical minerals that Canada says are critical to domestic industry, national security and emissions reduction can be found in Northwest Territories.

Nearly two-dozen explorers assumed the hunt for precious, base, and critical minerals in 2022, many with funding assistance through Northwest Territories' Mining Incentive Program.

The territorial government, with C$500,000 from the Canadian Northern Economic Development Agency, awarded C$1.5 million in grants to explorers and prospectors chasing early‐ and advanced-stage projects.

The government also reported 68 new claims (57,994.66 hectares) being staked in 2021. No claims were canceled, but 244 claims (151,828.15 hectares) lapsed. There are 20 active prospecting permits covering a total area of 302,369 hectares, or 747,153 acres.

Active mining and drilling took place during the year by Arctic Canadian Diamond Company Ltd .; Rio Tinto plc; De Beers; Gold Terra Resource Corp .; Arctic Star Exploration Corp .; Mountain Province Diamonds Inc .; North Arrow Minerals Inc .; Nighthawk Gold Corp .; Rover Metals Corp., with its joint venture partner Arctic Fox Minerals Corp .; Fireweed Metals Corp .; Golden Pursuit Resources Ltd .; Sixty North Gold Mining Ltd .; Osisko Metals Inc .; NorZinc Ltd .; Vital Metals Ltd .; and Fortune Mineral Ltd.

Natural Resources Canada projected total spending for mineral exploration and deposit appraisals to increase in Northwest Territories in 2022 to C$69.4 million, up slightly from a comparable outlay of C$68.1 million in 2021. NRCAN's estimates are based on explorers' spending intentions.

Improvements in infrastructure helped spur mining activity in 2022. The 97-kilometer (58 miles) Tlicho All Season Road, which stretches from west of Yellowknife to the community of Whati, opened in November 2021, providing improved access to mining projects.

Focus on 'green' minerals

A growing number of companies pursued exploration programs in Northwest Territories in 2022 in areas prospective for critical minerals designated in recent years by the United States and Canada as essential to the development of green technologies.

Leading this pack is Australia-based Vital Metals Ltd.

Vital, Canada's first rare earths producer, continued to pursue development in 2022 of its Nechalacho REE Mine project in Northwest Territories. The Australian company reported progress in every area, from exploration to marketing.

The company celebrated completion of a rare earth elements extraction facility in Saskatoon in September and said it would produce a 2.5 metric ton sample of rare earth carbonate produced from ore shipped from its NWT mine for its offtake partner in the coming months.

Northwest Territories government officials praised Vital Metals for its collaborative approach to mine development.

Mining services at Nechalacho, for example, were subcontracted to Det'on Cho Nahanni Construction Ltd., a local company owned by the Yellowknives Dene First Nation.

Wawzonek said the Nechalacho rare earths mine represents the first time an Indigenous group has been hired to extract minerals on its traditional land in Canada.

"In the North, perhaps more than anywhere, a collaborative model for resource development has emerged," she observed. "We have built, and continue to build, relationships in our territory that result in the support and acceptance of major infrastructure and resource projects. Beyond our incredible resources, it's what sets us apart from global competitors, and what makes the NWT a unique place to invest and do business."

By contrast, Vital recently reported discontinuing its exploration and development efforts on two REE projects in Quebec, primarily due to opposition from a local Indigenous group.

In September, Sixty North Gold Mining Ltd. reported a discovery that could result in the explorer changing direction. The company said it defined a 3,200-by-600-meter alteration zone on its Mon property as an iron oxide copper gold deposit.

Petrographic work on a sample from the coincident large magnetic low and intensely hydrothermally altered rocks at Mon, together with a comprehensive review of the geochemistry of samples collected from the property, characterizes the target. The discovery could potentially change the focus of Sixty North's exploration program, the explorer said.

"This is a virgin, grassroots discovery outlining a very large prospective target that was discovered by our team using standard exploration methodology," said Sixty North President and CEO Dave Webb.

Noting that IOCG systems are among the world's richest and largest mineral deposits, he said more geophysical and geochemical targets remain untested and would be assessed in the fall.

After mapping and prospecting a 1,500-meter-long portion of the zone, Webb said the large hydrothermally altered unit had been incorrectly identified as a gabbro by government and company geologists during the past 80 years.

Rover Metals Corp. signed a letter of intent in 2022 to option 90% ownership interest in the Indian Mountain Lake volcanic massive sulfide project, a district-scale land package covering some 30,000 acres of greenstone belt.

The project, located off the eastern arm of Great Slave Lake about 195 kilometers (117 miles) northeast of Yellowknife, has a historical zinc-lead-silver-copper geological resource and previous exploration dating back to the 1940s.

Focusing on zinc and copper, the junior conducted a C$200,000 geophysics program to define 2023 drill targets.

Other explorers that received MIP grants to assist with NWT critical minerals projects in 2022-2023 include NICAN Resources (C$67,879), seeking nickel in the South Slave area; Redbed Resources, (C$136,800) copper in the Dehcho region; StrategX Elements (C$120,000) cobalt in the North Slave area.

NWT diamonds sparkle

Mining operations continued throughout 2022 at the territory's three diamond mines, Ekati, Diavik and Gahcho Kué, with Arctic Diamonds reporting progress on its plan to develop an underwater remote mining system to recover diamonds from the flooded depths of Ekati's mined kimberlite pits by 2024.

Exploratory drilling by Arctic Star Exploration Corp. on the Diagras diamond property led to the discovery of five new diamond-rich kimberlites in 2021, according to the Northwest Territories Geological Survey.

After further exploration, including an airborne electromagnetic and magnetic survey and testing of the kimberlites in 2022, Arctic Star reported more encouraging results at Diagras, which hosts 13 known kimberlites originally discovered by DeBeers in the 1990s. The project is a joint venture in which Margaret Lake Diamonds holds an 18.5% interest.

Mountain Province Diamonds Inc., 49% owner of the Gahcho Kué diamond mine, reported a ground geophysics survey and surficial sampling in 2021 in ongoing exploration of its Kennady North diamond project, which is adjacent to the mine.

The explorer said it had encountered kimberlite in three of the four target areas it drilled by May at Kennady North in 2022.

Mountain Province also reported recovery of a 151-carat exceptional colored diamond at the Gahcho Kué mine, where ongoing exploration of the Hearne kimberlite returned encouraging results. Annual diamond production at Gahcho Kué continues to exceed six million carats.

Rio Tinto became the sole owner of the Diavik Diamond Mine in late 2021 when it acquired, with bankruptcy court approval, the 40 percent interest held formerly by Dominion Diamond Mines. Production at Diavik is expected to end in 2025.

Gold still glitters

Among gold explorers in the territory, Gold Terra Resource Corp. undertook one of the most active programs in 2022, seeking to boost the 1.2-million-ounce inferred resource of its Yellowknife City Gold Project by drilling up to 40,000 meters, or more than three times the 12,687 meters that it completed in 2021.

The 800-square-kilometer YCG Property is adjacent to the historic Con Mine and is situated immediately north, south, and east of Yellowknife, the capital city of the Northwest Territories.

In mid-2022, Gold Terra reported multiple high-grade gold intersections in winter drilling designed to test the Campbell Shear along strike south of the former producing Con Mine and at depths of about 1,000 meters at 200-meter drill spacing. High‐grade gold mineralization was intersected in multiple targeted zones, which include new assay results from an initial hole drilled at Yellorex North.

The remaining assay results on the Campbell Shear winter drilling program were designed to test the Campbell Shear along strike south of the former producing Con Mine and at depths of about 1,000 meters at 200-meter drill spacing. High‐grade gold mineralization was intersected in multiple targeted zones as per the results below, which include new assay results for hole GTCM22-039, an initial hole drilled at Yellorex North.

Gold Terra also reported encouraging results over more than 8,300 meters in 13 holes of winter drilling on the adjacent Con Mine Property, optioned from Newmont Corp. in late 2021.

"The 2022 winter drilling program results along the southern extension of the Campbell Shear shows multiple mineralized zones, which demonstrate great potential for additional ounces on the Con Option Property," said Gerald Panneton, chairman and CEO of Gold Terra.

Gold Terra released an initial mineral resource estimate for the optioned property in September, including an underground mineral resource of 109,000 gold ounces in the indicated category and 432,000 oz of gold in the inferred category.

"This initial mineral resource estimate confirms the significant high-grade potential of this project as it remains open for further expansion in all directions, and along its six-kilometer-long structure," Panneton observed, adding that the Con Mine produced more than 5 million ounces of high-grade gold (16 g/t Au) from the Campbell Shear structure on two kilometers of strike length alone.

Gold Terra has spent about C$6.2 million, reflecting a cost of about C$12 per ounce of gold.

Gold Terra also reported extending gold mineralization in the Mispickel area of the YCG project, adding two new gold zones, MP-Ryan, and Zone 14.

Gold Terra said it would return to the area in the winter with more drilling to infill and extend the three high-grade zones identified so far in the Mispickel area.

Nighthawk Gold Corp. continued to report high-grade results from the 72,325 meters of drilling it completed in 272 holes during 2022 on its 930-square-kilometer Indin Lake gold property about 200 kilometers (120 miles) north of Yellowknife.

The junior is advancing highly prospective exploration targets, including the Colomac Centre and satellite deposits, which have a mineral resource estimate of 58.2 million metric tons grading 1.44 g/t gold for 2.69 million ounces in the indicated category and 19.7 million tons grading 2.10 g/t gold for 1.33 million ounces in the inferred category.

In August, Nighthawk reported completion of its 2022 drill program of 40,085 meters, and assay results in November with exceptionally high grades in near-surface intercepts drilled on the Kim and Cass deposits, potential open-pit deposits located within 15 kilometers (9.3 miles) to the southwest of the Colomac Centre area. These include bonanza grades of 916.8 g/t gold over 0.50 meters within two meters averaging 232.18 g/t gold in hole CM22-22.

The explorer said it will update the project's mineral resource estimate by early 2023.

Several explorers pursued early-stage gold projects in 2022 in NWTs. These include Golden Planet, working in the North Slave area, and Danny Yakeleya, who focused on prospects in the territory's Sahtu region.

Advanced projects progress

Osisko Metals Inc. filed a positive preliminary economic assessment for its Pine Point lead-zinc mine project near the south shore of Great Slave Lake in July, outlining a C$602 million venture with a projected 12-year mine life, an after-tax internal rate of return of 25%, and average annual production of 329 million pounds of zinc and 141 million lb of lead.

Pine Point has 15.8 million metric tons of indicated mineral resources grading 4.17% zinc and 1.53% lead, representing about 25% of the declared tonnage in Osisko's updated 2022 mineral resource estimate. The project's inferred mineral resource totals 47.2 million metric tons, grading 4.43% zinc and 1.68% lead.

Osisko expects to complete ongoing infill drilling by the second half of 2023 and is eyeing startup of production at Pine Point in 2028.

In 2021, the explorer completed a 79‐hole infill and hydrogeological drilling program, conducted re‐logging and re‐assaying of historical drill core, and advanced a hydrogeological study at the project.

At the Prairie Creek zinc‐lead‐silver mine project in western NWT, NorZinc Ltd. won territorial approvals of its management plans for construction of an access road to the project in 2022.

NorZinc released a preliminary economic assessment for Pine Point in 2021 that envisions a 20-year mine based on a throughput rate of 2,400 metric tons per day with average annual payable zinc-equivalent production of 261 million pounds.

Anticipating startup of production in 2025, NorZinc planned a 5,300-meter surface exploration program during the 2022 summer field season, with a focus on further validating geotechnical structural controls, dilution estimates and metallurgical recoveries in concentrate for project financing. The company secured US$6 million in financing for the planned work program.

At its Nico cobalt‐gold‐bismuth-copper project, Fortune Minerals Ltd. evaluated four prospects in 2021 identified in earlier geophysical surveys and a 1997 drill program.

The Nico Project, situated south of Yellowknife, includes a planned open pit and underground mine, mill and concentrator in Northwest Territories, plus a planned hydrometallurgical refinery in Alberta.

Nico hosts 33.1 million metric tons of proven and probable reserves averaging 0.11% (82 million pounds) cobalt, 0.14% (110 million lb) bismuth, 0.04% (27 million lb) copper, and 1.03 grams per metric ton (1.1 million ounces) gold.

Drill results from 13 holes confirmed continuity of cobalt-gold-bismuth and local copper mineralization in the Peanut Lake Zone, located 800 meters southeast of the Nico deposit and identified a potential east strike extension of the deposit.

Fireweed Metals Ltd., known for its extensive exploration of the zinc-rich Macmillan Pass in neighboring Yukon Territory, purchased the Mactung Project from the territorial government in 2022 for C$15 million. The GNWT took ownership of Mactung in 2015 when former owner North American Tungsten Corporation Ltd. went bankrupt after tungsten prices plummeted.

Tungsten is a specialty metal classified by Canada and the United States as one of more than 30 "critical" metals with strategic importance. Mactung hosts one of the world's highest-grade tungsten deposits.

In mid-November, Fireweed also reported encouraging results from eight grab samples collected during its 2022 exploration program on the Gayna River Project in western NWT. The samples confirmed the presence of massive sulfide mineralization with elevated gallium, germanium, zinc, lead and silver values.

Fireweed also collected 10 soil samples that assayed with high lead and silver concentrations, ran a 52.7 line-kilometer ground gravity survey that highlighted multiple potential drill targets, and completed a lidar survey over the entire 128.75 square-kilometer (49.1 square miles) property.