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

ATAC Resources Ltd. May 29 announced that it has raised C$4.5 million for a roughly 10,000-meter drill program at Osiris, one of three projects that make up the 1,700-square-kilometer (656 square miles) Rackla Gold property in the Yukon.

Originally announced as a C$3 million financing, ATAC's oversubscribed private placement involved the issuance of 7.56 million flow-through shares at C$60 cents each.

Under a provision of Canada's Income Tax Act, flow-through financings allow exploration companies to transfer exploration expenses to individual investors that purchase the flow-through shares. The flow-through investor, in turn, can apply his portion of the exploration expense to reduce or eliminate his tax liability.

The exploration company must spend the flow-through dollars raised on a qualifying mineral project in Canada within two years of closing the financing.

ATAC plans to spend its flow-through funds on drilling at Osiris, saving its roughly C$13 million of working capital for advancing Rau, a gold and base metals property at the western end of Rackla.

"This flow-through financing will allow ATAC to pursue aggressive exploration programs at Rackla while preserving hard dollars for potential engineering and development activities," commented President and CEO Graham Downs.

As ATAC advances the two projects bookending Rackla, Barrick plans to complete roughly 12,000 meters of drilling to expand upon the Carlin-type gold at Orion, a 780-square-kilometer (301 square miles) section in the middle of ATAC's roughly 185-kilometer- (115 miles) long Rackla land package.

"We are excited to get started on what will be the largest drilling campaign since 2012 on the Rackla Gold property," said Downs.

Drilling Osiris

This year's drilling at Osiris will follow-up on the success ATAC had last year.

This success included the confirmation that faults "play an important role in the localization of high-grade Carlin-type gold mineralization at Conrad," a gold zone at Osiris.

One of the first holes drilled at Osiris last year cut 67.06 meters of 3.35 g/t gold, including 15.14 meters of 7.25 g/t gold within and adjacent to the 350 Fault zone at the western end of Conrad.

Hole OS-17-238, targeting the 650 Fault corridor at the eastern end of Conrad, cut 12.5 meters of 20.78 g/t gold.

This year's drilling will focus on systematically stepping out from known gold mineralization within these fault corridors.

ATAC will also drill Sunrise, another Carlin-type gold zone at Osiris.

The 2017 drilling at Sunrise showed strong continuity of gold mineralization with a consistent increase in grades at depth, including 10.42 meters of 7.97 g/t gold and 15.24 meters of 13.52 g/t gold.

This year's drilling will focus on expanding Sunrise along strike and to depth.

ATAC also plans to further investigate the Osiris zone, which has only been outlined through brief drilling in 2011 and 2017.

Gold mineralization at the Osiris zone is concentrated at stratigraphic boundaries where mineralizing fluids become focused. This gold concentration is demonstrated in OS-17-244, which cut 12.19 meters of 9.6 g/t gold at the contact between the limestone and mudstone rock units.

This year's drilling at the Osiris Zone in 2018 will test strike and depth extension of gold mineralization.

Advancing Tiger, Rau

ATAC's 2018 exploration program will also continue to investigate Rau, "where results indicate the potential for a district-scale polymetallic discovery."

The 660-square-kilometer (255 square miles) Rau property blankets a 12.5-mile trend of metals deposits and prospects that include:

• Tiger, carbonate replacement style deposit with 5.68 million metric tons of measured and indicated resources averaging 2.66 g/t (485,700 ounces) gold;

• Airstrip, a large gold anomaly about 4,000 meters south of Tiger;

• Ocelot, a silver-lead-zinc discovery about nine miles northwest of Tiger; and

• multiple other precious and base metals geochemical anomalies.

A preliminary economic assessment completed for Tiger in 2016 outlines plans to use an agitated tank carbon-in-pulp leaching process to recover gold from the highly oxidized material found there. This PEA estimates a mine at Tiger would produce roughly 302,300 oz of gold over a six-year mine life from ore averaging 3.81 g/t gold.

Estimated pre-production capital costs for this operation are C$109.4 million and life-of-mine sustaining capital costs are expected to be C$8.3 million.

With an eye on advancing Tiger through feasibility and permitting, ATAC drilled 12 holes there last year.

Highlights include:

• 51.82 meters of 5.66 g/t gold in oxide mineralization east of Tiger;

• 56.77 meters of 4.08 g/t gold in a hole that confirms sulfide grade and continuity within the deposit;

• 64.01 meters of 2.46 g/t gold in sulfide mineralization to the west of Tiger; and

• 21.34 meters of 2.59 g/t gold in new oxide gold mineralization at the Tiger East anomaly.

Exploration along trend of the Tiger deposit in 2018 will include a targeted advancement of the Condor, Panther and Spotlight targets.

Highlight grab sample results from last year's prospecting at these targets include:

• 7,080 g/t silver, 4.63 percent copper and 3.27 g/t gold at Spotlight;

• 17 g/t gold and 23.3 percent zinc at Condor; and,

• 8.18 g/t gold at Panther.

By re-evaluating pat geochemical and geophysical data, ATAC has identified three potential intrusive centers at Rau that could be the sources for the mineralization found there.

One is believed to be related to the development of gold mineralization at Tiger; a second is in the area of the Spotlight target; and the third roughly nine miles west of Tiger.

All three intrusive centers and priority geophysical anomalies will be further evaluated during the 2018 field program.

This work will include hand pitting, prospecting, and geological mapping. First pass geochemical soil sampling will be conducted over a large area around the Spotlight target not previously sampled.

ATAC Resources Ltd.

In March 2018, the Yukon government and the First Nation of Na-Cho Nyak Dun filed a joint document that allows ATAC to move forward with its plans to build a 65-kilometer (40 miles), private, all-season tote road to the Tiger gold deposit.

The proposed road would branch off the Hanson Lake Road west of Keno City and is envisioned as a gated, single-lane and radio-controlled road suitable for vehicles supporting the company's exploration and other activities at Rau.

In addition to supporting Tiger and other Rau targets, it is expected that this road could provide a staging area in support of exploration on the Orion and Osiris projects to the east.

–SHANE LASLEY