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By Curt Freeman
For Mining News 

New year, decade brings opportunities

Alaska mining industry will continue to supply world's demands for mineral resources, despite ups and downs in global markets


Last updated 1/17/2010 at Noon

As we plunge headlong into a new year and a new decade, the broad economic indicators for the mining industry suggest continued strong prices for most commodities in 2010 followed by slightly lower average prices in 2011 and beyond as supplies catch up to demand. Not surprisingly, the source of much of the commodities demand will be Asia with China and India being the two leading economic engines driving commodity prices.

Where Alaska's mining industry fits into this global supply and demand puzzle is anything but clear. Professors, prognosticators and pundits have all weighed in with forecasts of the future, however, all are couched in Nostradamus-like caveats that make it hard for the rest of us to understand and equally hard for them to be proven clearly wrong! One thing that does appear to be certain is that the Alaska mining industry is not going to go away and Alaska will continue to supply the world's growing demands for mineral resources.

Western Alaska

Zazu Metals Corp. announced that Canadian Zinc Corp. acquired 3.4 million shares of Zazu, representing approximately 11.1 percent of Zazu's outstanding shares, for a consideration of US$650,000. Zazu's principal asset is the Lik zinc-lead-silver deposit, located in northwest Alaska, 22 kilometers from Teck Resources' Red Dog. Canadian Zinc indicated that it had acquired the shares for investment purposes.

Millrock Resources Inc. announced that it has entered an exploration agreement with Kinross Gold Corp. to conduct exploration in the Council Mining District in the south-central Seward Peninsula.

The agreement pertains to a more than 900-square-kilometer area that includes Millrock's Albion and Council properties, and other mining claims.

Under terms of the agreement Kinross can earn a 55 percent joint venture interest in Millrock's properties, and any other properties secured by the companies in the area of interest, by incurring exploration expenditures of US$3 million and paying Millrock a total of US$260,000.

The initial cash payment is US$65,000, and the minimum 2010 exploration expenditure is US$500,000.

The agreement includes provisions for a private placement financing of US$250,000, in which Kinross will purchase shares of Millrock.

Kinross may elect to increase its interest in the project to 75 percent by making a further US$3 million exploration expenditure.

Ophir Creek and the surrounding tributary creeks, which comprise the Council Mining District, have produced in excess of half a million ounces of placer gold.

A placer operation on Albion Creek historically mined what appears to be a residual lode deposit.

A large northwest-trending gold and gold-pathfinder element soil anomaly, measuring 900 meters by 2,000 meters, surrounds the old placer workings.

The companies are planning to drill-test the prospect in 2010.

Millrock Resources Inc. announced that it had signed a letter of intent to enter into a joint venture agreement with Alaska newcomer Valdez Gold Inc. on Millrock's Bluff gold project east of Nome.

Valdez Gold can earn an initial 55 percent interest in the project by spending US$3.0 million in exploration expenditures, making option payments of US$300,000, and issuing 900,000 shares of stock prior to December 31, 2012.

The 2010 exploration expenditures commitment is US$500,000 and initial payments are US$50,000 and 300,000 shares.

Valdez may elect to earn an additional 20 percent by making additional exploration expenditures of US$3.0 million, further option payments of US$600,000, issuing 1.1 million additional shares of stock over three years and meeting the obligations of lease agreements with underlying land owner Bering Straits Native Corporation.

Welcome to Alaska Valdez Gold Inc!

Alix Resources Corp. announced that it had terminated its interest in the Divide gold project in the Nome District.

Interior Alaska

Teryl Resources Corp. announced that it had declined to accept the acquisition offer tabled by Kinross Gold Corp. for Teryl's 20 percent interest in the Gil gold deposit in the Fairbanks District. The company indicated that it had declined the offer because it had not received all of the 2009 exploration data generated by the project.

Freegold Ventures Limited and Western Standard Metals Ltd. signed and on option agreement whereby Western Standard can earn a 50 percent interest in Freegold Ventures' Golden Summit project located 20 miles, or 32 kilometers, north of Fairbanks, Alaska.

Under the terms of the agreement Western Standard would pay Freegold C$300,000 on the closing of the deal and make exploration expenditures of US$5.75 million by December 31, 2013.

The 2010 exploration expenditures commitment is US$750,000.

Western Standard said its initial exploration program will consist of data compilation, verification and target generation to identify areas for drilling in 2010.

Initial drilling will be focused on extending the near surface intrusion hosted gold mineralization intersected in historic drill holes at the Tolovana-Dolphin deposit.

The company said it is targeting large, bulk mineable zones in their exploration program.

Welcome to Alaska Western Standard Metals Ltd!

Alaska Range

Ocean Park Ventures Corp. announced that it intends to complete a non-brokered private placement for gross proceeds of up to US$7 million. Net proceeds of this placement will be used to explore its Chisna copper and gold project acquired in late 2009 from International Tower Hill Mines.

Pure Nickel Inc. announced results from its 2009 exploration season at the Man project.

The property is currently under a joint venture agreement with Itochu Corp. The 2009 drill program completed 4,200 meters of drilling in seven holes, a new Z axis Tipper electromagnetic airborne survey, extensive geological mapping and a proprietary fluxgate time domain ground electromagnetic survey.

Three drill holes were completed in the 30-kilometer-long Alpha Complex and four holes were completed in southern Beta Complex.

Significant drill results include hole PNI-09-24, which returned 1 meter grading 0.528 percent nickel, 0.302 percent copper, 110 parts per billion platinum and 60 parts per billion palladium; and hole PNI-09-25, which returned 0.5 meters grading 0.455 percent nickel, 0.196 percent copper, 70 parts per billion platinum and 250 parts per billion palladium.

Hole PNI-09-25 was drilled to a depth of 1066 meters and terminated due to the limitations of the drill.

A down-hole electromagnetic survey on this hole indicated the presence of a possible conductive body below the hole's termination depth.

The 2010 drilling program will be designed to investigate the deeper source of these large and strong conductive bodies underlying the Alpha and Beta complexes.

Northern Alaska

Novagold Resources Inc. announced that it has entered into an agreement to purchase a 100 percent interest in the Ambler polymetallic sulfide deposit in the Brooks Range.

Under terms of the agreement, NovaGold has agreed to pay Kennecott Exploration Co. a total purchase price of US$29 million.

The total price includes US$5 million by the issuance of NovaGold shares, and two installments of US$12 million each, due 12 months and 24 months, respectively, after the effective date of the transaction.

Kennecott will retain a 1 percent net smelter return royalty that can be purchased at any time for a one-time payment of US$10 million.

NovaGold will continue its previously started community engagement programs in 2010, and has appointed a project team to plan exploration activities, advance environmental baseline studies and conduct engineering and technical studies at the project with the goal of gaining a better understanding of the true size and potential of the district as well as the continuity and mineability of the other deposits in the Ambler massive sulfide belt.

Current resources at Ambler include indicated resources of 16.8 million metric tons grading 4.1 percent copper, 6 percent zinc, 0.94 percent lead, 0.83 g/t gold and 59.6 g/t silver, and additional inferred resources of 11.9 million metric tons grading 3.6 percent copper, 5 percent zinc, 0.80 percent lead, 0.67 g/t gold and 48.4 g/t silver.

Southeast Alaska

CBR Gold Corp. and joint venture partner Heatherdale Resources Ltd. announced that significant intersections of high grade, copper-gold-zinc-silver mineralization were encountered in underground drilling at the Niblack polymetallic project on Prince of Wales Island.

This new mineralization is located southwest of the currently known mineral resources in the Lookout deposit.

Significant results include hole U29 which intersected 61.4 feet grading 1.40 percent copper, 2.40 g/t gold, 2.81 percent zinc and 48 g/t silver; hole U30 which intersected 32.7 feet grading 1.83 percent copper, 3.39 g/t gold, 2.56 percent zinc and 57 g/t silver; and hole U31 which intersected 143.9 feet grading 2.25 percent copper, 3.01 g/t gold, 5.52 percent zinc and 76 g/t silver.

The partners plan to complete a series of fan drill patterns from stations positioned at intervals along the extension of this newly discovered mineralization.

An additional underground drill rig has been added to the project to help advance this planned work.

Ucore Uranium Inc. announced additional drilling results from its Bokan-Dotson Ridge rare earth element project on Prince of Wales Island.

The 2009 program, operated by Ucore's wholly owned U.S.-based subsidiary, Rare Earth One, completed a total of 2,840 meters of core from 27 diamond drill holes.

Significant results from the Dotson prospect include hole LM09-68, which returned 1.68 meters grading 1.57 percent light rare earth elements and 0.61 percent heavy rare earth elements, hole LM09-70, which returned 1.09 meters grading 0.83 percent light rare earth elements and 0.69 percent heavy rare earth elements and hole LM09-71, which returned 1.47 meters grading 1.11 percent light rare earth elements and 1.02 percent heavy rare earth elements and an additional 1.59 meters grading 1.75 percent light rare earth elements and 1.37 percent heavy rare earth elements.

In 2010 Ucore intends to conduct sufficiently dense infill and deep drilling on the Dotson trend to allow the generation of a Canadian National Instrument 43-101-compliant resource estimate.

Ucore also intends to aggressively advance a new target area at the Sunday Trend, to the northwest of Bokan Mountain.


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