Explorers seek big finds in north country
Mining incentives, rich deposits lure dozens to hunt for elephants
Last updated 3/1/2019 at 4:55am
More than three dozen explorers chased lucrative mineral deposits in Yukon Territory in 2017 and most of these junior and senior companies returned to the northern jurisdiction this year to take another crack at hitting the jackpot.
Known for its rich and storied gold mining history as well as its rugged mountain peaks, Yukon is roughly 15 percent larger than California, covering more than 482,000 square kilometers (186,272 square miles). Split off from the Northwest Territories during the Gold Rush in 1898, the territory still is a prolific mining jurisdiction 120 years later.
Explorers seeking gold as well as other lucrative minerals, including silver, copper, zinc, lead and platinum, have focused on historic mining areas and greenfields in targeting Yukon prospects, especially in the central and southern parts of the territory.
Of the top 100 minerals exploration projects in Canada in 2018, 12 are underway in Yukon, according to Natural Resources Canada. Compare that to five top projects taking place in Northwest Territories and seven in Nunavut.
With metals markets heating up, it's little wonder interest in Canada's North had re-ignited. However, the trend is especially prevalent in Yukon.
Natural Resources Canada estimates Yukon expenditures for mineral exploration and deposit appraisals in 2018 will top C$172 million, up 4.2 percent from C$165.1 million a year ago.
Yukon's success in attracting explorers to target mineral prospects is due, at least in part, to the territorial government's aggressive approach to encouraging mineral investment.
The Yukon Mineral Exploration Program, for example, has become an effective economic incentive for mining companies to explore the territory. This year more than 52 applicants won grants for placer and hardrock projects totaling C$1.6 million.
By supporting early exploration, Yukon has paved the path to numerous discoveries during the past two decades, and this activity will provide significant long-term economic beneﬁts to the territory, Yukon officials say. YMEP funding supports early mineral exploration by providing a portion of the risk capital required to locate, explore and develop mineral occurrences in Yukon.
The incentives are designed to keep a variety of projects moving through the pipeline at various stages of advancement, and some projects have progressed through YMEP and beyond the intended scope of the program, including the Coffee, Andrew and Red Mountain projects. They have stimulated significant investment beyond their initial YMEP-funded expenditures. Collectively, these three projects represent a total investment exceeding C$147 million; have combined resources of 7.14 million ounces gold, 990 million pounds zinc, and 238 million lb lead, and together, are valued at more than C$12.1 billion. The total YMEP investment in the trio was C$396,000, which corresponds to a leveraging ratio of 371:1, according to the Yukon Geological Survey, which administers the program.
Goldcorp Inc. bought the Coffee Gold project in 2016 in a deal valued at C$520 million. In its earliest stage, Coffee was one of a couple of gold discoveries that ignited a modern staking rush eight years ago to an area known today as the White Gold District of west-central Yukon.
The major is currently working to expand the 5 million ounces of gold already identified as indicated and inferred resources at Coffee with hopes of achieving by 2021 commercial production with an open-pit, heap-leach operation capable of 184,000 oz of gold in annual output over a 10-year mine life.
Goldcorp's 2017 exploration program involved more than 68,000 meters of reverse circulation and diamond drilling (602 holes). Reported drill highlights include 20.3 meters of 7.24 g/t gold in reverse circulation hole CFR1452 at the new AmeriKona zone.
The Andrew Zinc Deposit in the Selwyn Basin and the Red Mountain precious and base metal deposit in central Yukon did not see significant exploration activity in 2018.
Several other high-profile projects have recently benefited from YMEP investment and generated enough success and momentum to secure financing in equity markets. They include the 3 Aces, Plateau and Wellesley Lake projects.
The 3 Aces project is an orogenic gold target consisting of 1,734 claims covering 35,700 hectares (88,215 acres) in southeast Yukon that is being explored by Golden Predator Mining Corp.
Until this year, Golden Predator concentrated its exploration on the 13.5-square-kilometer Central Core Area, a broad gold-in-soil anomaly, where numerous orogenic gold-bearing quartz veins have been discovered. Exploration results during the past two years support a stratigraphic structural model that predicts extensive lateral and vertical continuity of the 3 Aces mineral system.
The junior completed an extensive drill program at the 3 Aces property in 2017, including 1,905 meters of diamond drilling in 20 holes, 17,394 meters of reverse circulation drilling in 189 holes, and 115.8 meters of rotary air blast drilling in one hole. Other work at 3 Aces in southeastern Yukon included soil and rock sampling, trenching, geological mapping and road construction. The extensive program uncovered two new gold veins at the Hearts and Clubs zones. Drilling at the Ace of Hearts doubled the known strike length of the vein and increased the length of the Hearts-Clubs corridor to 1.6 kilometer (one mile).
The explorer undertook drilling programs this year to establish continuity between the Central Core and other mineralized zones along the 35-kilometer- (22 miles) long strike at 3 Aces. Orogenic gold deposits, among the world's largest and richest, include the California Mother Lode Belt and the Juneau Gold Belt.
The 2018 exploration program, funded with a C$8.4 million financing in February, focused on exploration and drilling along an eight-kilometer (5 miles) stretch of gold-bearing terrain identified from geochemistry and mapping that connect the Sprogge area to the Central Core area where Golden Predator successfully drilled high-grade gold intercepts last year.
Goldstrike Resources is another beneficiary of a YMEP grant for its Plateau property in 2014 for conducting 3D resistivity and chargeability surveys, and gathering samples from the VG, Ben and SW zones for rock physics measurements. Since 2014, Plateau has seen more than C$10.2 million in exploration spending. Drilling last year principally focused on understanding and modeling the controls of the high-grade gold mineralization present at surface at Plateau and in core from previous drill campaigns. The junior successfully identified multiple key target areas and new surface gold mineralization along the 70-kilometer- (43 miles) long Yellow Giant trend, confirming a district-scale gold mineralized system.
In March 2017, Goldstrike reported forming a strategic alliance with Newmont Mining Corp. to acquire the Plateau property in a deal worth C$53 million. Newmont recently posted plans to conduct a 10,000-meter drill program at the Plateau property this year.
While mining exploration and development activity is currently robust in Yukon, the territory has only one operating mine, the Minto Mine, owned and managed until recently by Capstone Mining Co. In 2017 Minto, a 3,750 metric-ton-per-day copper‐gold-silver mine about 240 kilometers (149 miles) northwest of Whitehorse, Yukon, produced 16,300 metric tons of copper, 25,200 oz of gold and 170,809 oz of silver. With the rise in the price of copper, Capstone also reported an extension of mine life for Minto to 2020.
In early 2018, U.K.-based Pembridge Resources Inc. bought the Minto mine and surrounding property for $37.5 million and vowed to expand the mine's reserves while optimizing its production.
Two formerly producing mines, Alexco Resource Corp.'s Bellekeno mine in the historic Keno Hill Silver District in central Yukon, while Yukon Zinc Corp.'s Wolverine zinc-lead mine remain shuttered in the southeast. The respective owners worked in 2018 toward re-starts of both operations, with Alexco making noticeable progress with drilling aimed at further defining a previously outlined resource of 858,000 metric tons grading 628 g/t (17.3 million oz) silver at the very high-grade Bermingham deposit. Yukon Zinc completed an updated preliminary economic assessment in September 2017 but did not release the results. The company is currently seeking investment partners to restart production at Wolverine.
Victoria Gold Corp. continued mine development in 2018 at the Eagle intrusion-related gold deposit, within the company's Dublin Gulch property in central Yukon. Revised capital expenditures are estimated at C$442 million. The Eagle Gold Mine is expected to be Yukon's next operating gold mine with first gold anticipated in the second half of 2019. The Eagle and Olive deposits, together, include proven and probable reserves of 2.7 million oz of gold from 123 million metric tons of ore with a grade of 0.67 g/t gold. Full mine construction began March 15. In full production, the Eagle mine is expected to produce 200,000 oz per year of gold from an open pit operation.
Ongoing exploration at Dublin Gulch is identifying more resources on the 555-square-kilometer (214 square miles) property. Last year, Victoria completed 34,000 meters of exploration diamond drilling and more than 5,600 meters of surface trenches, confirming that Eagle mineralization persists to the north and west and to depth with successful drilling of the Eagle West, Eagle Extension and Eagle Deep zones
Drillhole DG17-930C, the deepest hole ever drilled at Eagle, returned 104.6 meters of 1.20 g/t gold to depth, below the current Eagle Mine pit, while also demonstrating the validity of the Eagle Resource Model and additional resources within the Eagle mine pit.
The 2017 program also established on-surface, Eagle-style mineralization at the Eagle West target through a 50 x 50-meter drill-out delineating a potential location for mineralized overliner material for the Eagle Gold Mine heap leach facility.
Victoria said its 2018 program will concentrate on the Olive-Shamrock, Bluto, Nugget and VBW targets and include mapping, prospecting, surface trenches, soils geochemistry, geophysical surveys and diamond drilling. The junior plans to continue step-out and definition drilling at Olive-Shamrock-Spinach with the intention of expanding the known, near-surface, minable tonnage along the mineralized shear zone. Additionally, two first-order targets on the 13-kilometer- (eight miles) plus Potato Hills Trend; Bluto and Nugget, will undergo advanced exploration. In addition to their geological potential, these targets are each accessible from Eagle Mine infrastructure by an existing access trail network.
BMC Minerals Ltd., a private company, is continuing to advance its Kudz Ze Kayah volcanogenic massive sulphide copper-zinc-lead property in the Finlayson district of east-central Yukon. The 2017 work program included soil sampling, geological mapping, a 3D seismic survey and drilling, including 4,235 meters of diamond drilling in 19 holes and 616 meters of RC drilling for geotechnical purposes in 25 holes. An application to develop the ABM deposit on the property was submitted to YESAB (Yukon Environmental and Socio-economic Assessment Board) in 2017 and is in the adequacy review stage. A positive pre-feasibility study on the ABM deposit was released in 2017 that envisions an open pit and small underground mine, processing 2 million metric tons per year over a nine-year mine life. BMC also acquired the nearby Wolf and Fyre Lake (Kona) VMS deposits last year and completed reconnaissance mapping and prospecting on those properties.
In February, this U.K.-based resources development company said it closed a US$38 million debt facility, which brings its borrowing capacity up to US$100 million. The funds will be used to advance exploration and development of the Kudz Ze Kayah project in 2018 and into next year with a focus on completing the definitive feasibility study currently underway for KZK's ABM deposit and to progress the project through the re-permitting process.
"Concurrently, we will be working to further explore and understand the geological prospectivity of the minerals claims we already own. In accordance with our strategy to grow the company through acquisition and development of projects, we also will consider further project acquisition opportunities," BMC CEO Scott Donaldson said.
Gold lures dozens
ATAC Resources Ltd. is exploring its 1,700 square-kilometer (656 square-miles) Rackla Gold project, which lies along the northern margin of the Selwyn basin in east-central Yukon. Having identified multiple mineral deposits in recent years on Rackla, an extensive property slightly larger than half of Rhode Island, the junior also attracted major gold producer Barrick Gold Corp. in 2017 as a partner in exploring the centrally located Orion deposit. This year, Barrick mounted a C$6 million, 10,000-meter drilling campaign, targeting the Carlin-style gold found at Orion, while ATAC forged ahead with exploration of the Osiris and Rau clusters of deposits situated at the eastern and western ends of the property, respectively. Among highlights of ATAC's C$7 million exploration campaign this year is the discovery of a new deposit, Bobcat, a gold and copper skarn mineralization situated about 4,500 meters southeast of Rau's Tiger deposit.
White Gold Corp. tackled a C$9 million exploration program in 2018 to expand known deposits and explore the larger potential across roughly 1 million acres (390,000 hectares) of prospective lands that it holds in Yukon's White Gold District. The explorer acquired the substantial land package from Wildwood Exploration Inc. and Shawn Ryan in 2016. In 2017, the junior expanded its holdings by acquiring five properties from Kinross Gold, including the Golden Saddle deposit, which is the original White Gold district discovery. White Gold Corp. has completed work on more than 29 of its properties including soil sampling, geophysical surveys, geological mapping and drilling. Kinross and Agnico Eagle Mines Ltd., each, hold a 19.9 percent ownership interest in the explorer.
Rockhaven Resources Ltd. continues to upgrade and expand its epithermal gold-silver deposit at Klaza, one of the highest-grade gold deposits ever discovered in Yukon. With news in early 2018 of positive recovery results in metallurgical tests on ore found at Klaza, Rockhaven said that it planned additional definition and expansion drilling as well as exploration drilling of near-surface mineralized zones that parallel Klaza resources, including high-grade structures identified by its 2017 program.
The explorer published an updated resource in June, boosting the project's estimated resource to 4.5 million metric tons of indicated resources averaging 4.8 g/t (686,000 oz) gold and 98 g/t (14.07 million oz) silver, or 907,000 gold-equivalent oz. The 254-square-kilometer (98 square miles) Klaza property also hosts 5.7 million metric tons of inferred resources, averaging 2.8 g/t (507,000 oz) gold and 76 g/t (13.9 million oz) silver, or 725,000 gold-equivalent oz. In 2017, Coeur Mining bought 3.75 million shares of Rockhaven for C$675,000. Strategic Metals Ltd., Rockhaven's largest shareholder, currently holds a 41.75 percent stake in the explorer.
Triumph Gold Corp. is exploring its district-scale Freegold Mountain property in central Yukon this year with a 17,500-meter drilling program, targeting several different zones. Since 2016, the junior has focused on a six-kilometer- (four miles) long intense multi-element soil and geophysical anomaly that encompasses the Revenue and Nucleus deposit areas. Within the anomaly, the Blue Sky zone covers a broad area extending 2,300 meters east of Revenue to the eastern margin of the anomaly. Following up on initial drilling that encountered significant intersections in 2017, Triumph Gold delineated gold-rich porphyry-style mineralization at Blue Sky with more drilling this year. The best intercept so far from drilling at Blue Sky was 316 meters of 1.1 grams per metric ton gold, 0.27 percent copper, 5 g/t silver and 0.02 percent molybdenum in hole RVD18-19, which includes 79.75 meters of 2.48 g/t gold, 0.38 percent copper, 6.9 g/t silver and 0.02 percent molybdenum. "RVD18-19 contains a truly exceptional intersection. Not only does it represent the longest and highest grade intersection in the Blue Sky Porphyry to date, but it is one of the highest grade intersections ever made in a porphyry system in the Yukon," said Triumph Gold President and CEO Paul Reynolds. In addition to drilling, the explorer also planned to update the soil grid and conduct trenching and an induced polarization survey of the area. The junior said results from 2018 drilling, new soil grid, trenching and geophysics will allow its technical team to plan a robust follow-up program of exploration to define a resource on the Blue Sky zone in 2019.
Triumph Gold also reported completion of drilling other exploration targets, including the Guder and Granger zones. Last year during extensive exploration on the property, the junior hit 15.0 g/t gold over 7 meters in hole RVD17-14 at Guder and 4.48 g/t gold over 16.73 meters in GRRAB-091 at Granger. The company welcomed a C$6.3 million investment which earned Goldcorp a 19.9 percent interest in Triumph.
Yukon also attracted more than two dozen other explorers, either returning to existing gold projects or targeting new gold prospects. These juniors include Klondike Gold Corp., returning to its large Klondike Goldfields property in the legendary Klondike Gold District; K2Gold Corp., returning to its Wels intrusion-related gold property in southwestern Yukon; Independence Gold Corp., returning to its Boulevard property, which is contiguous to Goldcorp's Coffee property in the White Gold district; Banyan Gold Corp., returning to its Hyland Gold project in southeastern Yukon; Arcus Development Group Inc., returning to its Dan Man gold property adjacent to the Coffee gold project; and Comstock Metals Ltd., returning to its QV gold property in the White Gold district; and Provenance Gold Corp., which is following up early exploration in the Moosehorn Range of western Yukon.
Silver, base metals also bait hook
Explorers seeking silver and base metals, while far fewer in number, nonetheless jumped into the 2018 field season in Yukon with gusto.
Nickel Creek Platinum Corp. (formerly Wellgreen Platinum), for example, advanced its plan to develop a mine at its Nickel Shaw project in southeastern Yukon by focusing this year on studying the metallurgy of the property's nickel-copper-cobalt-PGM sulfide mineralization. The junior also located new drill targets along the strike length of the property's 18-kilometer (11 miles) trend to determine whether the already large resource is part of an even larger, district-scale system.
Fireweed Zinc Ltd. is exploring its Macmillan Pass zinc-lead-silver project on a large package of claims in Selwyn Basin of southeastern Yukon with a substantial program of drilling known deposits and sampling and surveying other areas for new exploration prospects. A preliminary economic assessment completed in May outlined a 4,900-metric-ton-per-day mill at MacMillan Pass that would produce 3.4 billion lb of zinc, 1.9 billion lb of lead and 37.2 million oz of silver over an 18-year mine life.
Base metals also attracted Benz Mining Co., which is exploring the Mel zinc-lead-barite project located in southeast Yukon. Benz purchased the Mel property last year and is working to upgrade and existing resource and expand the resource base for the project.
Other explorers targeting silver prospects include CMC Metals Ltd. at the Silver Hart property in southern Yukon and Silver Range Resources Ltd. at the Michelle property in northwestern Yukon.