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

Millrock Resources Inc. Oct. 1 said it is investing the C$1.58 million it recently raised to position the company and its properties for expected improving markets for gold-focused exploration companies.

"The moves Millrock has made over the past three months has positioned the company well for what appears to be a coming bull market in precious metals," said Millrock Resources President and CEO Greg Beischer. "We have developed an enviable gold project portfolio that is attracting funding partnerships and should result in substantial drill programs in 2020."

This includes the potential to have drills turning on its West Pogo property in Alaska's Goodpaster Mining District as early as February.

"With drilling comes the potential to increase Millrock's share price through mineral deposit discovery," said Beischer.

Enter Dragonslayer

Last week, Millrock announced that it had entered into an agreement with First Quantum Minerals Ltd., to explore Dragonslayer, a copper-gold property the company generated with the recent financing.

First Quantum can earn the exclusive right to enter an option to joint venture Dragonslayer by funding C$100,000 of initial exploration that includes geochemical surveys, mapping, and prospecting.

This work focused on a geophysical anomaly located in a belt of Cretaceous-aged rocks in eastern Alaska that have demonstrated potential for copper porphyry deposits.

The geophysical anomaly consists of a conductive zone surrounding a magnetic high in a low-lying area with little outcrop exposure.

Millrock said the initial exploration funded by First Quantum is now complete and results are expected later this month.

If First Quantum decides to enter into the option agreement, the Canada-based copper mining company can earn an initial 51 percent interest in Dragonslayer by spending C$6 million on exploration and making cash payments of C$700,000 to Millrock over four years. This ownership can be increased to 80 percent by funding the project to commercial production.

First Quantum has until Dec. 31 to exercise its option to enter into a joint venture on Dragonslayer.

Inroads at West Pogo

In the meantime, Millrock has been refining drill targets at West Pogo, a property that covers what appears to be a western continuation of the Goodpaster deposit being drilled on Northern Star Resources Ltd.'s Pogo property.

Northern Star has traced the Goodpaster zone for 2,300 meters along strike and to a depth of 500 meters with drilling. The company said the drills have tapped both the flat-lying stacked Liese-style and the vertical North Zone-type vein structures currently being mined at Pogo.

Highlights from Northern Star's drilling at Goodpaster include: 2.1 meters of 44.5 g/t gold; 2.2 meters of 28.1 g/t gold; 0.6 meters of 100.1 g/t gold; and 0.3 meters of 170.2 g/t gold.

Millrock said many of Northern Star's holes drilled or being planned at Goodpaster are less than 500 meters east of West Pogo, and one hole is only about 90 meters from the claim line.

Millrock is expecting to receive permits to carry out drilling at West Pogo soon.

To narrow targets for the drilling, the company completed 13 kilometers (eight miles) of controlled-source audio-frequency magnetotellurics (CSAMT) geophysical surveys at West Pogo. This geophysical technique has proven to be a useful tool in identifying the buried structures that commonly host gold veins on the Pogo property, including the veins tapped at the Goodpaster discovery.

In addition to hosting what appears to be an extension of the Goodpaster veins, West Pogo is transected by the access road to Pogo.

Millrock has applied for heavy equipment access along the Pogo Mine road from the State of Alaska and has requested bids to build a three-mile-long road into to the Aurora Creek valley, a primary target area on West Pogo. The company is also pricing the installation of a well that would provide water for year-round drilling.

The Aurora Creek target area is defined by strong gold-arsenic-bismuth anomalies overlying a distinct magnetic low. Two of Northern Star's discoveries on Pogo – Central Veins and Goodpaster – are also associated with magnetic lows.

Millrock Resources Inc.

The Aurora Creek target area on Millrock Resources' West Pogo gold property. The red dots represent holes drilled or planned by Northern Star Resources at the Goodpaster target on its Pogo property. The yellow lines represent the CSAMT geophysical survey recently completed on West Pogo.

Drilling by previous operators have encountered steeply dipping gold-bearing quartz veins in the Aurora Creek area. Millrock believes that the stacked flat lying veins such as those found in the Liese, Central Veins and Goodpaster deposits on the Pogo property may be present below the depth previously drilled. Results from the CSAMT survey, expected soon, will help determine if this is the case.

Millrock's next steps at West Pogo include the collection of historical drill core stored at various prospect sites at Pogo. Once gathered, the company plans to relog the core and assay previously unsampled sections. And, depending on the costs, the company plans to have the drill access road and well installed.

Installation of a year-round water source would give Millrock the optionality of doing the first West Pogo drill project as early as February.

Millrock said it has received interest from companies that would like to partner up on exploration at West Pogo, one of several projects that makes up the company's expansive land position in the Goodpaster District.

–SHANE LASLEY