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By Sarah Hurst
For Mining News 

International Tower Hill builds Alaska stronghold

Explorers from AngloGold Ashanti took a Vancouver-based junior and headed north with several aggressive projects in the state

 

Last updated 12/24/2006 at Noon



A newly expanded company is making Alaska its exploration target, and it's backed by a mining heavyweight. Vancouver-based International Tower Hill Mines was barely a glimmer on anyone's radar screens until last summer, when South African major AngloGold Ashanti purchased 19.99 percent of ITH's shares and gave the junior its North American exploration manager, Jeff Pontius, as president and CEO. Pontius led the team that acquired a group of Alaska properties for AngloGold, which now belong to ITH.

"AngloGold was highly focused on three primary areas globally, one in the DRC (Democratic Republic of the Congo), one in Colombia and another in Western Australia and didn't have the funding to push forward their Alaskan initiative that we had started here several years ago, and was just starting to bear fruit with some good drilling that happened in 2005 and a couple of new discoveries that we had," Pontius said at the Alaska Miners Association convention in Anchorage Nov. 8.

"So what we did was vend all of those assets into a Canadian junior, International Tower Hill, which had a couple of properties in Ontario and one in B.C., and along with that International Tower Hill raised $11 million for exploration and basically received seven projects from AngloGold on a 100-percent basis, and then were entered into two joint ventures on their two more advanced projects, the Terra and LMS projects, where International Tower Hill would earn 60 percent interest for $3 million over four years," Pontius added. AngloGold retained back-in rights and a right of first offer on ITH's projects.

Six main projects

ITH currently has six "main projects" and another four that it hopes to explore in joint venture partnerships. The newest main project is West Tanana, 250 kilometers west of Fairbanks, which ITH acquired in September from Doyon, an Alaska Native corporation. The agreement between the companies states that ITH is required to pay Doyon $350,000 over six years, make annual scholarship donations of $10,000 per year and incur exploration expenditures totaling $2,625,000.

ITH's other main projects are Terra, Livengood, LMS, Chisna and Coffee Dome. The joint venture opportunities are West Pogo, Gilles, Caribou and Blackshell. Most of the projects are in the Fairbanks area, apart from Terra, which is 200 kilometers west of Anchorage, and Chisna, which is 100 kilometers east of Paxson, a community with only a handful of permanent residents at the intersection of the Richardson and Denali highways.

The LMS gold project is about 25 kilometers north of Delta Junction in the Goodpaster mining district of Interior Alaska, and is accessible by winter road or riverboat, so helicopter support is not needed. In the past two seasons AngloGold and ITH have drilled approximately 5,000 meters on the property and the next step will be to produce a 3-D model. "The most interesting part of this thing is that it's been cut by a number of very high-grade veins with lots of visible gold in them," Pontius said.

One problem that ITH has to contend with in this area of the Goodpaster region is that it's covered by silt, which is between one meter and 10 meters thick, according to Pontius. The company has been using a mechanized drill that can penetrate all the way through the thickest layers of silt. "This has given us a much better view of what the soil geochemistry is down in these anomalies, it's a very important tool and we'll continue to use that," Pontius said.

Terra accessible only by air

ITH's other advanced project, Terra, is accessible only by aircraft, and the site maintains a 650-meter gravel airstrip. Outcropping gold veins were first discovered at this property in the late 1990s by Kennecott. Former Kennecott geologist Ben Porterfield acquired that company's claims in the area in 2000 and optioned them to AngloGold in 2004; AngloGold also staked additional claims at Terra.

Porterfield and his partner have been mining a gold vein by hand on the property for the past five years. "It is every geologist's dream to find a high-grade vein they can mine," Porterfield told Mining News. "I have learned a great deal in the process, primarily that gold mining is very hard work. My respect for the old-timers who did it without helicopters has increased considerably."

"The veins are episodic, banded veins; they typically have sulfur salts in them and lots of visible gold, and the numbers can be quite high grade out here. Many of the samples we've taken out here are in excess of 100 grams a ton," Pontius confirmed. "Our targeting here's about 3 million tons of high-grade mineralization. I think we definitely have a good shot at that, the veins that we've found so far range from about half a meter to four meters in width and are averaging right now about 25 grams a ton," he added.

Surface prospecting expanded

This year ITH expanded the surface prospecting program at Terra to cover the full 8-kilometer strike length of the system. The company also conducted a limited drilling program on the extension of the "Ben Vein" - named after Porterfield - which was the focus of the 2005 drilling campaign. The Ben Vein system has now been intersected in all eight holes drilled along the greater than 250 meters of strike length and 250 meters down dip and it remains completely open, according to ITH.

"Results from the six holes drilled in 2005 and the two holes drilled in 2006 indicate the Ben Vein system has remarkable continuity of grade and appears to be expanding in width to the northwest, as shown by the last hole which intersected 4.2 meters averaging 22.4 grams per ton gold," the company said in a release Nov. 16. The proposed 2007 work program at Terra will include more drilling on the Ben Vein system to evaluate the grade and continuity of the deposit. ITH also plans to test two of the other vein systems to assess their potential to develop similar systems. Terra's estimated budget next year will be $2 million.

Livengood is northwest of Fairbanks

The Livengood project is about 120 kilometers northwest of Fairbanks, in the center of a placer district that has produced over 500,000 ounces of gold since 1914. ITH has drilled a series of holes to assess gross-tonnage potential, document the grade distribution and assess the potential for a higher-grade core zone. A gold characterization study is being conducted by an independent laboratory to better understand the gold occurrences and dissemination. The currently defined target horizon lying under the large soil anomaly is 200-300 meters thick and dipping gently to the south.

"The earlier work that Anglo did in here basically found a large zone of gold mineralization in the one-half to 1 gram a ton range. Our best intercept was 133 meters of 1.1 grams a ton," Pontius said. "Just as a note, this is sitting right on the Elliott Highway, a paved road goes right through the project site and it's got lots of network of roads around here, so this is really accessible and easy for us to work on." ITH drilled approximately 1,500 meters at Livengood this year.

"It primarily sits in a section of Devonian sediments, it's set in the lower plate of a thrust package in here and it's been intruded by 90 million-year-old intrusions, which are probably the mechanism for gold mineralization in here," Pontius added. "It might be a bit of a unique kind of deposit that we're into."

Coffee Dome north of Fort Knox

The Coffee Dome project is just 15 kilometers north of the mill at Fort Knox gold mine and could potentially be a target with geological similarities to the Pogo deposit, the site of Alaska's newest underground mine, Pontius told the miners' convention. ITH plans a drilling and trenching program at Coffee Dome next year.

ITH's new West Tanana project is in the Tintina Gold Belt, in an area that has been historically mined for placer gold. Doyon's data files contained records of a soil anomaly that ITH wanted to investigate further, so the company collected approximately 500 soil samples this year, demonstrating that the anomaly was larger than had been previously thought. Analysis of the soil survey indicated a multistage geochemical association with gold, primarily associated with gold-arsenic-tellurium. The presence of bismuth, tellurium and gold together with low antimony suggested that the mineralization could be related to a proximal magmatic hydrothermal system.

The results of the soil sampling were encouraging enough that ITH decided to embark on a drill program at West Tanana in 2007 to test both the anomaly adjacent to Monday Creek and the mineralization along the schist-quartzite contact to the west of Monday Creek. No drilling has taken place in this area before.

Surface sampling at Chisna

Surface sampling results from the Chisna project in the eastern Alaska Range indicate that a large area in the central portion of the property has the potential to host a significant, near-surface bulk tonnage copper-gold-silver deposit, ITH said Nov. 27.

Reconnaissance-scale geochemical sampling from a number of highly altered zones defined a large open-ended target area, covering approximately 25 square kilometers, within which highly anomalous copper, gold and silver values occur. A total of 73 rock samples collected from this area averaged 0.19 percent copper, 0.33 grams per ton of gold and 2.8 grams per ton of silver, with 21 of these samples exceeding 200 parts-per-million copper and averaging 0.6 percent copper, 1.06 grams per ton of gold and 8.2 grams per ton of silver.

ITH's total exploration budget for 2007 will be approximately $6.5 million.

"We will continue to seek third parties that are interested in some of our projects that we cannot get to. Our whole goal is to try and advance all of these projects as quickly as we possibly can, and if we don't end up with all the interest in them, then we're prepared to do that," Pontius told the miners' convention.

"We're going to conduct our activities in a manner with respect for the land, the people and the regions, and particularly the communities that we work around. Alaska is a great place to work," Pontius said. "New name, same old faces. We've just got different business cards now, but we're doing the same job we were doing before. We are a well-financed, discovery-driven, aggressive Alaskan exploration company and we have a depth of experience and a good project portfolio, so I'm very excited about the company and I think you're going to see great things come from us in the future."

 

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