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

The recent discovery of significant gold mineralization near the headwaters of the White River in western Yukon Territory has sparked a staking rush fired by the imagination of miners with a long memory.

More than 12 junior exploration companies have flocked to the region in recent weeks, grabbing claims in the proximity of the increasingly promising White Gold Project held by Underworld Resources Ltd.

Underworld May 26 reported discovery of 103 meters grading 3.4 grams per metric ton gold.

The companies are also latching onto property a good distance away but ostensibly bearing geological similarities to the mineralization that Underworld uncovered at White Gold's Golden Saddle Prospect.

"They are calling it the biggest staking rush since Voisey's Bay," Underworld Chairman Michael Williams told Mining News.

Voisey's Bay was a big nickel discovery in Labrador in the 1990s.

Re-staking the Klondike

About 4,529 quartz claims were staked since January this year, in the northwestern quarter of Yukon Territory, many of them in the vicinity of the White Gold discovery, said Kathryn Perry, Yukon Mining Recorder in the Dawson office.

That compared with 820 comparable claims staked during the first six months of 2008.

"We've recorded about 2,500 claims in the past week, and we're not done yet," Perry told Mining News June 22.

Mike Burke, a senior geologist with the Yukon Geological Survey, said any company currently rushing to the Klondike to look for gold is "smart."

Though the White Gold discovery is not in the Klondike, it is the first hardrock discovery close to the fabled region, Burke said.

"It opens up a new deposit type to explore for in the Dawson Range and Klondike that might have contributed to the vast amount of gold that came out of the Klondike," he said.

Another reason miners are flocking to the area is that White Gold, unlike Northern Freegold Ltd.'s impressive gold discovery last year, is surrounded by a lot of unclaimed land.

"Northern Freegold's discovery attracted a lot of attention, but a lot of that area was already staked," Burke said. "White Gold is brand new in an area that has never been explored before (in modern times). It also recently was mapped by the Yukon Geological Survey, so people have solid data to look for similar geology, airborne signatures and such.

"It's also the herd mentality - 'Here's a bright light in a down year,' " he added.

As for numbers, Burke said that for every explorer announcing the acquisition of property or the staking of claims in the area, there are others who are keeping quiet.

"It's a moving target. We'll know in a few months. Right now, there are lots of people coming and going," he said. "I've heard stories about folks telling people riding on the elevator in Vancouver about their new claims, only to learn their audience had picked up claims, too."

A modern gold rush?

Shawn Ryan, a Yukon prospector who optioned the original White Gold claims to Underworld in 2007, said he believes the recent influx of miners is only the beginning of an industry rush to the area. "You can let your imagination run wild," he said.

"Basically, Underworld found 25 meters of gold, and then it was 50 meters and then it was 100 meters," Ryan said. "I think it caught everybody off guard. Over the last 100 years, we haven't seen anything like this.

"I use the analogy of Sasquatch. We've been seeing tracks for 100 years, but now we have our first sighting. We're getting a picture of what this beast looks like, and that is what is capturing the imagination of explorers across the planet," he said.

Discovery revives legendary quest

During the late 1890s and early 1900s, miners took millions of ounces of gold out of the placer creeks of western Yukon Territory, but no one ever found the source of all that gold.

"The registered amount of placer gold found in the Klondike was 12 million to 13 million ounces, but I figure it was really more like 20 million ounces," Ryan said. "(White Gold) is the type of deposit that could have produced that much gold. The last hole they drilled was 300 meters thick. I'm just waiting to see what their next set of drill results will be."

The prospector said the Underworld discovery has brought the entire Klondike region back into vogue.

"The Gold Rush mentality is back up here," he said. "The companies are coming in. We're also getting the riffraff, like we did in the original Gold Rush."

Ryan's company, Ryanwood Exploration Inc., staked the area currently being explored and optioned the initial claims package for the White Gold Project to Underworld.

He said he currently is working with four other companies.

"We just recorded over 2,200 claims," he said and added that more work is planned.

"We've got four helicopters going and over 30 guys are in the bush - ground staking rather than paper staking. That's what is fun about it."

Ryan said miners are beginning to re-evaluate all of the creeks in the area.

"We're getting ready to launch a big program this summer. While we had eight to 10 guys last summer, we will have 22-24 people on staff this year, doing soil sampling, lightweight trenching and magnetic surveys," he added. "It's just getting going."

Leading the parade

Explorers seeking to mimic Underworld's exploration success range from newcomers to longtime explorers in the territory, and some of them have already benefitted from the rush.

"Companies are staking all around the Underworld discovery and doubling their market cap in the process," said Underworld's Williams.

While the discovery was centrally located on the White Gold claims, Underworld added to the claims package last fall and in January as its geologists began to comprehend the geological signature of the deposit," Williams said.

"Our guys did a pretty good job. On a scale of 1-10, I'd say were at an 8 or 9 in getting the claims we wanted," he said. "That's not to say some of the other guys don't have discoveries on their properties. But it's good to be in the lead. You don't want to be a spectator on this one."