North of 60 Mining News - The mining newspaper for Alaska and Canada's North

Pebble Partnership copper gold molybdenum mine project Alaska Northern Dynasty NAK NDM

By Shane Lasley
Mining News 

Golden opportunities outweigh BC policy

Northern BC attracts explorers despite regulatory concerns

 

Last updated 12/9/2019 at 10:32am

Coeur Mining Silvertip

Snow reflects the lights from the camp at Silvertip, Coeur Mining's recently acquired high-grade silver mine near the Yukon border in northern British Columbia.

Whether it be precious metals such as gold and silver, base metals like copper and zinc, or battery metals like nickel and cobalt, northern British Columbia is rich in the type of metal deposits that junior mining companies are hoping to discover and majors are wanting to mine.

Couple this mineral endowment with good infrastructure – especially stacked up against the other jurisdictions in the North of 60 Mining News coverage area – and northern B.C. continues to draw strong exploration spending.

Despite its rich mineral potential and relatively good infrastructure, however, B.C. falls in the bottom half of Canada's provinces and territories when it comes to attracting mining sector investments, according to the Fraser Institute Survey of Mining Companies 2018.

Concerns over environmental regulations, First Nations land claims and questions over what areas will be protected are among the issues weighing on the mining executives that responded to the survey.

"Rules around Indigenous consultation and environmental regulations are unclear, and this deters investment," a mineral exploration company president wrote in response to the Fraser survey.

The provincial government likely did not allay these concerns with its 2019 moratorium on resource development and potential expansion of an environmental protected area where at least two exploration companies have identified promising vanadium discoveries in northeastern B.C.

"(U)ntil the uncertainty over these proposals is cleared up, we will be measured appropriately in our activities and expenditures on our Pine Pass and Ursula vanadium projects," said Ethos Gold Corp. CEO Craig Roberts.

Authors of the Fraser Institute mining survey said concerns over environmental regulations and protected areas in B.C. were more prevalent among junior exploration companies than the majors.

"In British Columbia, 69 percent of explorers see regulatory duplication and inconsistencies as a deterrent to investment, compared to 56 percent of producers," the Canada-based think-tank penned in its report.

Major moves in northern B.C.

The divergence of concerns over B.C.'s regulatory system seems to be playing out in the northern half of the province, where an increasing number of major mining companies are investing.

Among the newcomers is Newcrest Mining Ltd., which paid US$806.5 million to acquire a 70 percent stake in Imperial Metals Corp.'s Red Chris gold-copper mine in the province's Golden Triangle region, one of the majors that see northern B.C.'s mineral potential outweighing any regulatory apprehensions.

With acquisition of Red Chris, finalized on Aug. 15, Newcrest has set in motion a two-stage plan to realize the buried potential of this northern B.C. gold-copper mine.

The first stage includes optimizing the mill and open-pit mine at Red Chris.

The open-pit portion of Red Chris includes 847.9 million metric tons of measured and indicated resources averaging 0.31 percent (5.79 billion pounds) copper, 0.27 grams per metric ton (7.36 million ounces) gold and 1.01 g/t (27.53 million oz) silver; plus 397.3 million metric tons of inferred resource averaging 0.24 percent (2.1 billion lb) copper, 0.26 g/t (3.32 million oz) gold and 0.93 g/t (11.88 million oz) silver.

Newcrest said optimizing this near-surface resource and the 11-million-metric-ton-per-year processing plant at Red Chris provide opportunities to get more out of this northern B.C. Mine in the short term.

The real value, however, comes when the Australian company implements block cave mining, which involves starting at the bottom of the orebody and allowing the deposit to progressively collapse under its own weight, during the second phase of its plan.

The underground portion of Red Chris hosts 185.8 million metric tons of measured and indicated resource averaging 0.53 percent (2.17 billion lb) copper, 0.7 g/t (4.18 million oz) gold and 1.72 g/t (10.28 million oz) silver. Plus, 389.8 million metric tons of inferred resource averaging 0.33 percent (2.84 billion lb) copper, 0.38 g/t (4.76 million oz) gold and 1.15 g/t (14.41 million oz) silver.

Newcrest, which has successfully implemented block cave mining in Australia, plans to invest heavily in an accelerated drill program needed to implement this bulk underground mining technique at its new copper-gold project in B.C.

"We believe we can bring our unique technical capabilities to unlock the full value potential of this orebody in one of the premier gold districts in the world," said Newcrest Managing Director Sandeep Biswas.

Newcrest is not the only major working toward unlocking Golden Triangle's vast mineral potential.

Newmont Goldcorp, which bought a 50 percent stake in the massive Galore Creek copper-gold project in 2018, recently grabbed a foothold in another copper-gold discovery just 15 kilometers (nine miles) west of Red Chris.

In May, Newmont bought C$17.6 million worth of GT Gold Corp. shares, a strategic investment that provides the world's largest gold mining company a 9.9 percent stake in the junior.

GT Gold is using the funds to expand a large porphyry gold-copper-silver discovery it made at Saddle North on its Tatogga property.

An 8,200-meter discovery drill program in 2018 cut up to 900-meter-thick zones of porphyry copper-gold-silver mineralization at Saddle North. Impressive widths of bulk-minable grades are continuing to be tapped this year at this emerging porphyry deposit.

Newmont's largest 2019 investment in the Golden Triangle, however, is at Galore Creek.

Since buying Novagold Resources Inc.'s 50 percent stake in Galore Creek last year, Newmont and Teck Resources Ltd., its equal partner in the world-class gold-copper project, have stepped up activities there.

This began with an updated calculation that outlines 1.1 billion metric tons of measured and indicated resources averaging 0.47 percent (5.1 million metric tons) copper, 0.26 g/t (9.3 million ounces) gold and 4.2 g/t (150 million oz) silver.

To gain an even better understanding of this world-class orebody, Newmont and Teck are carrying out an 18,000-meter drill program this year.

This work, along with engineering and baseline environmental studies, will allow the Galore Creek partners to advance this world-class asset further up the value chain.

"We plan to initiate a prefeasibility study for Galore, with Newmont, early in 2020," said Teck Resources Vice President of Business Development.

Teck also owns a 75 percent interest in Schaft Creek, another porphyry mine project about 30 kilometers (19 miles) northeast of Galore Creek that hosts 940.8 million metric tons proven and probable reserves averaging 0.27 percent (5.6 billion lb) copper, 0.19 g/t (5.8 million oz) gold, 1.72 g/t (51.7 million oz) silver and 0.018 percent (10.2 million lb) molybdenum.

Copper Fox Metals Inc. owns the remaining 25 percent stake in this large copper-gold-silver-molybdenum project.

Gold outweighs junior concerns

For dozens of junior exploration companies, Golden Triangle's prospectivity for gold-rich porphyry projects like KSM outweigh policy concerns in northern B.C.

The largest such project in this land of giant porphyry deposits is KSM, owned by Seabridge Gold Inc.

Four deposits at KSM – Kerr, Mitchell, Sulphurets and Iron Cap – host 2.98 billion metric tons of measured and indicated resources averaging 0.52 g/t (49.7 million oz) gold, 0.21 percent (13.9 billion lb) copper, 2.8 g/t (265.3 million oz) silver and 54 parts per million (312 million lb) molybdenum; plus 4.56 billion metric tons of inferred resource averaging 0.38 g/t (56.3 million oz) gold, 0.32 percent (32 billion lb) copper, 2.4 g/t (348.8 million oz) silver and 32 ppm (295 million lb) molybdenum.

A prefeasibility study completed in 2016 detailed a 53-year mine at KSM that would produce an average of 540,000 oz gold, 156 million lb copper, 2.2 million oz silver, and 1.2 million lb molybdenum annually.

Substantial resource expansion since the PFS, along with the completed federal and provincial permitting, further de-risk this project for any producer looking for a world-class gold-copper in a stable jurisdiction.

"We continue to believe that due to its size, location, economics and permit status, KSM represents one of the most compelling development opportunities on the planet," said Seabridge Gold Chairman and CEO Rudi Fronk.

While majors have shown interest in KSM, as of the writing of this report Seabridge had yet to find a suitable partner.

As Seabridge seeks a major partner at KSM, other explorers are seeking similar large gold-copper deposits in the area.

One such junior, Aben Resources Ltd., is making intriguing discoveries on its Forrest Kerr property about 45 kilometers (28 miles) northwest of KSM.

Much of Aben's recent exploration at Forrest Kerr has focused on near-surface, high-grade gold identified in the Boundary zones – for good reason.

FK18-10, drilled last year, cut 10 meters of 38.7 grams per metric ton (1.12 ounces per metric ton) gold from a depth of 114 meters, including one meter of 331 g/t (9.65 oz/t) gold.

This is very similar to the 326 g/t gold Noranda encountered in RG91-16, a historical hole drilled roughly 200 meters to the south.

While Aben's 2019 program continues to test the high-grade gold here, the company is also targeting the large porphyry-style copper-gold deposit types that are common in northwestern B.C.

High grade exploration

While large bulk tonnage projects at KSM are a major target in the Golden Triangle, northern B.C. is also renown for its high-grade gold.

The best example of this is Pretium Resources Inc.'s Brucejack property immediately southeast of KSM.

Valley of the Kings and West zones at Brucejack host 16 million metric tons of proven and probable reserves averaging 12.6 g/t (6.4 million oz) gold and 59.3 g/t (30.5 million oz) silver.

These reserves provide enough ore for Brucejack to churn out an average of 525,000 oz of gold annually over the next 10 years at all-in sustaining cost of US$535/oz.

Looking beyond the mine plan, Pretium launched a 70,000-meter underground drill program early in 2019 that is expected to expand Valley of the Kings reserves.

In addition, the company is investigating the property's wider potential, including long holes drilled from the Valley of the Kings that have tapped additional high-grade gold and encountered signs of KSM-style porphyry mineralization.

Further afield, a 5,000-meter grassroots program investigated Pretium's Bowser claims south of Brucejack for volcanogenic massive sulfide (VMS) similar to the ore mined at the iconic Eskay Creek project about 25 kilometers (16 miles) to the northwest.

From 1994 to 2008, Barrick Gold Corp. operated an underground mine at Eskay Creek that produced roughly 3.3 million oz of gold and 160 million oz of silver from ore averaging 45 g/t gold and 2,224 g/t silver.

Skeena Resources Ltd., which cut a deal in 2017 to acquire Eskay from Barrick, is exploring the potential of resuming mining there, with an emphasis on portions of the deposits that could be mined from the surface.

According to an early 2019 calculation, Eskay Creek hosts 12.71 million metric tons of surface mineable indicated resource averaging 4.5 g/t (1.82 million ounces) gold and 117 g/t (47.79 million oz) silver; and 13.57 metric tons of surface mineable inferred resource averaging 2.2 g/t (984,000 oz) gold and 42 g/t (18.46 million oz) silver.

This year, Skeena is carrying out a roughly 15,000-meter drill program aimed primarily at upgrading this near-surface resource.

Skeena is also exploring Snip, another past producing gold property it acquired from Barrick.

In the 1990s, an underground mine at Snip produced 1.1 million ounces of gold from 1.25 million metric tons of ore averaging 27.5 g/t gold.

A lot has changed over the two decades since Barrick shuttered operations at Snip, including much higher gold price and improved infrastructure in the Golden Triangle.

Over the past two years, Skeena has expanded high-grade gold Barrick left when gold was only selling for around US$300/oz.

"The prospects for redeveloping the Snip property have improved dramatically, given today's substantially higher gold prices, subsequent improvements in infrastructure and access, the prospect of remaining high-grade mineralization and exploration upside," the company penned on its website.

Revitalizing Stewart

One of the most compelling northern B.C. exploration stories is efforts to revitalize Stewart, a mining town at the southern gateway of the Golden Triangle.

The Premier gold-silver mine played a key role in Stewart's history and is a main character in the hoped-for revival of this community.

An underground mine at Premier produced 2 million oz of gold and 45 million oz of silver from 1918 to 1952; and an open-pit operation in the 1990s produced another 260,000 oz of gold and 5.1 million oz of silver.

In recent years, Ascot Resources Ltd. has focused on utilizing the infrastructure that remains from the latest iteration of the Premier Mine to restart operations there.

In addition to Premier, Ascot's landholdings in the Stewart area include Dilworth, a property just north of Premier that hosts the Big Missouri mines; Silver Coin, an adjacent property that also provided ore to the mill at Premier; and Red Mountain, another gold-silver asset gained through the acquisition of IDM Mining.

Premier, which still hosts the mill and other infrastructure from past mining, is central to Ascot's plans to resume and start mining at all of these properties around Stewart. As such, this property is a primary focus of the company's activities this year.

While the Premier property has the infrastructure, the Red Mountain mine project about 15 kilometers (nine miles) northeast of Stewart is arguably more advanced in terms of engineering, permitting and social license.

This operation is based on 1.95 million metric tons of reserves, averaging 7.53 g/t (473,000 oz) gold and 21.86 g/t (1.37 million oz) silver.

Prior to Ascot's acquisition, IDM Mining had received the requisite provincial and federal environmental assessment approvals for an underground mine at Red Mountain that is expected to average roughly 78,800 oz of gold and 228,800 oz of silver annually over an initial six-year mine-life.

The issuance of the provincial environmental assessment was heralded by First Nations, municipal and provincial leaders from the area of northwestern British Columbia where the underground mine is to be developed.

"I am happy with this decision, which will see significant jobs and business opportunities along with appropriate safeguards to protect and support our community," Stewart Mayor Gina McKay said, upon the issuance of provincial permits for Red Mountain.

Ascot is updating the Red Mountain feasibility study to include significant resource expansion drilling completed by IDM prior to Ascot acquiring the property.

StrikePoint Gold Inc. is another company exploring gold and silver properties in the immediate Stewart area. For 2019, this work primarily focused on Willoughby, a property that is very similar to Ascot's Red Mountain about seven kilometers (four miles) to the west.

StrikePoint also owns Porter, a high-grade silver property on a mountain rising above Stewart. Two early 20th century mines on the Porter property produced 2.2 million oz of silver.

Rich in silver and zinc

Northern B.C. is also rich in silver-zinc-lead deposits, some more richly endowed with precious metal, others with base metals.

Coeur Mining Inc.'s Silvertip Mine in the far northern reaches of the province, which leans toward the precious metal side, is on pace to produce roughly 2 million oz of silver, 32 million lb of zinc and 27 million lb of lead at its Silvertip Mine this year.

While this newly constructed mine came with a high-grade silver resource when Coeur acquired it late in 2017, a technical report and mine plan to elevate them to reserves had yet to be completed.

To rectify this, the Chicago-based miner carried out a rigorous drill program that converted some 58 percent of the resources that came with Silvertip into enough reserves to feed the mill for about 4.5 years.

According to a calculation completed at the end of 2018, Silvertip hosts 1.6 million tons of proven and probable reserves averaging 289 g/t (14.98 million oz) silver, 8.2 percent (292.71 million pounds) zinc and 5.6 percent (198.66 million lb) lead.

"We are pleased with the successful conversion of a large portion of the resource to an initial reserve and related mine plan at Silvertip," said Coeur Mining President and CEO Mitchell Krebs.

In addition to reserves, this project went into 2019 with 1.3 million tons of measured and indicated resources averaging 6.47 oz/t (8.4 million oz) silver, 8.6 percent (221.62 million lb) zinc and 4.07 (105.19 million lb) lead; and 583,000 tons of inferred resource averaging 7.91 g/t (4.6 million oz) silver, 9.3 percent (108.62 million lb) zinc and 5.02 percent (58.59 million lb) lead.

The company is focused on resource growth and expansion with drilling carried out at Silvertip this year.

Dolly Varden Silver Corp. is focused on expanding high-grade silver resources at its namesake property south of Stewart, B.C.

The deposits outlined so far at Dolly Varden – Torbrit, Dolly Varden, Wolf and North Star – host 3.42 million metric tons of indicated resource averaging 299.8 g/t (32.93 million oz) silver; plus 1.29 million metric tons of inferred resource averaging 277 g/t (11.48 million oz) silver

These four deposits are associated with historic high-grade silver mines that date back to the early 20th century.

This year, the company is focusing on targets outside the known resource areas. Early results indicate this strategy is paying off.

The first hole reported from Chance, which is about 4,000 meters north of Torbrit cut 26.5 meters averaging 385.4 g/t silver.

The company said this discovery demonstrates Dolly Varden's wider potential.

"In viewing the Dolly Varden Property as a whole, it should be noted that there are multiple silver deposits and high-grade silver targets within a five-kilometer radius," said Dolly Varden Silver President Gary Cope.

ZincX Resources Corp.'s Akie project in the northeastern part of the province leans more towards the base metals side of the equation.

A 2018 preliminary economic assessment contemplates a 4,000-metric ton underground mine at the Cardiac Creek deposit on Akie producing 3.27 billion pounds of zinc and 362 million lb of lead over an initial 18-year mine life.

This is based on 22.7 million metric tons of indicated resource averaging 8.32 percent (4.16 billion lb) zinc, 1.61 percent (804 million lb) lead and 14.1 grams per metric ton (10.3 million ounces) silver; and 7.5 million metric tons of inferred resource averaging 7.04 percent (1.17 billion lb) zinc; 1.24 percent (205 million lb) lead and 12 g/t (2.9 million oz) silver.

A 2,500-meter drill program being carried out this year aims to increase the confidence in the resource and extend the high-grade core of the deposit to the southeast.

Mixed bag for battery metals

At a time when green energy and electric vehicles are creating huge demand for battery metals, exploration companies are advancing very promising deposits of nickel, cobalt and vanadium in northern B.C. The potential of some of these projects, however, may not be fully realized.

One of the most intriguing new battery metal projects is an extremely high-grade nickel deposit being unveiled by Garibaldi Resources Inc. at its Nickel Mountain property about 18 kilometers (11 miles) southwest of the historic Eskay Creek Mine.

"The project is ideally positioned to leverage the demand from dramatically declining nickel sulfide discoveries and the resulting depletion of high-quality nickel inventories required to fuel the electric vehicle battery revolution," said Peter Lightfoot, a technical advisor to Garibaldi and nickel geology expert.

Since tapping 16.75 meters of 8.3 percent nickel, 4.2 percent copper, 0.19 percent cobalt, 1.96 g/t platinum, 4.5 g/t palladium, 1.1 g/t gold and 11.1 g/t silver in the I&L zone at Nickel Mountain in 2017, Garibaldi has outlined stacked sheets of massive sulfide rich in these metals.

Girabaldi's 2019 drilling at Nickel Mountain is targeting the expansion of the five zones already identified – Lower Discovery, Upper Discovery, Northeast, Central and Northwest – as well as targeting the discovery of new zones of massive sulfide mineralization across a 12-kilometer- (7.5 miles) long area of nickel prospective geology.

Giga Metals Corp.'s Turnagin property, however, hosts the most advanced battery metals project in northern B.C.

A resource calculated in conjunction with a preliminary economic assessment prepared for Turnagain in 2011 outlines 865 million metric tons of measured and indicated resources at Turnagain averaging 0.21 percent (4 billion pounds) nickel and 0.013 percent (250 million lb) cobalt; plus 976 million metric tons of inferred resource averaging 0.2 (4 billion lb) nickel and 0.013 (280 million lb) cobalt.

Giga Metal completed 38 holes at the project during 2018 and is expected to upgrade and expand these resources.

In addition to supplying the metals needed for the batteries in electric vehicles, studies under the direction of Greg Dipple, professor at the Bradshaw Research Initiative for Minerals and Mining, University of British Columbia, indicate that tailings from mining at Turnagain could absorb carbon dioxide from the atmosphere.

"More than a decade of research by project lead Dr. Greg Dipple has shown that silicate mineral residue, when exposed to the atmosphere, absorbs CO2 and converts it to carbonate minerals, and the CO2 would remain locked in the carbonates over geological time scales," said Giga Metals CEO Mark Jarvis.

Dipple estimates that CO2 reacting with just 10 percent of the magnesium silicate and hydroxide minerals in a mine's tailings could more than offset the annual carbon emissions of a mining operation.

This carbon offset could be good news for marketing Turnagain nickel and cobalt to lithium ion battery manufacturers.

Explorers of another potential green energy battery metal found in northeastern B.C., however, suffered a setback this year.

Ethos Gold and other exploration companies discovered potentially valuable sources of vanadium, a metal being studied for batteries that could store grid-scale amounts of electricity.

Taking advantage of vanadium's ability to exist in solution in four different oxidation states, the vanadium redox battery uses vanadium in two of these states as electroactive elements, instead of separate elements for the cathode and anode.

The amount of energy a VRB can store is only limited by the size of the storage tank built to hold the vanadium solutions.

With these batteries that could make renewable electricity more viable on the horizon, exploration companies such as Ethos began revisiting an area of northeastern B.C. known to host vanadium.

This led to the company staking Pine Pass, a vanadium property with a paved highway passing through it.

Vanadium bearing horizons were identified at Pine Pass in 1976 and sampling carried out there found concentrations of up to 0.82 percent vanadium pentoxide within a broad vanadium bearing section with an indicated true thickness of approximately 100 meters.

Rich mineral potential and good infrastructure, northern British Columbia's strong suits, is what drew Ethos to these vanadium properties in the first place.

Giga Metals Corp.

Boxes of core from the nearly 80,000 meters of drilling completed at Giga Metals' Turnagain nickel-cobalt project in northern B.C. prior to 2011.

"These deposit types are particularly hard to find in favorable jurisdictions with good access and infrastructure for development," said Ethos Gold CEO Roberts.

A potential environmental protection area laid over this highway accessible vanadium-rich area, however, makes the advantages moot.

Pine Pass and other vanadium exploration properties nearby, however, are found in an area under a development moratorium and is being considered for inclusion in an expanded environmental protected area related to caribou.

The provincial government's handling of the moratorium over the vanadium-rich areas of northeastern B.C. will likely be reflected when mining executives' grade B.C. policies in the future. The rich mineral potential and good infrastructure of northern B.C., however, will likely continue to outweigh any policy concerns of mining companies.

Author Bio

Shane Lasley, Publisher

Over his more than 11 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.

Email: publisher@miningnewsnorth.com
Phone: (907) 726-1095
https://www.facebook.com/miningnewsnorth

 

Reader Comments
(0)

 
 

Our Family of Publications Includes:

Powered by ROAR Online Publication Software from Lions Light Corporation
© Copyright 2019