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By Shane Lasley
Mining News 

Skeena raises C$33M for BC exploration

Provides junior abundant cash for Eskay Creek, Snip drilling


Last updated 4/17/2020 at 4:24am

Winter drilling rig Eskay Creek gold silver project northwestern BC

Skeena Resources Ltd.

Skeena is currently carrying out a planned 28,000-meter drill program at its Eskay Creek gold-silver project in British Columbia's Golden Triangle.

Skeena Resources Ltd. April 15 announced it has raised C$33.3 million to continue the advancement of its mineral exploration properties in British Columbia's Golden Triangle.

This financing was completed in two tranches. The first tranche, which closed on March 31, involved the sale of 13 million B.C. "super-flow-through" shares at C$1.155 each for gross proceeds of C$15 million.

Under a provision of Canada's Income Tax Act, flow-through financings allow Canadian companies to transfer expenses for exploring for minerals in Canada 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. In the case of super-flow-through financings, provinces offer similar tax incentives to investors for exploration carried out within the province.

In the second tranche, Skeena collected an additional C$18.2 million from the sale of 16.8 flow-through shares – some of which were super-flow-through shares sold for C$1.155 each, and the balance were standard federal flow-through shares sold at C$1.05 per share.

The more than C$33 million raised will fund ongoing exploration of the company's Eskay Creek and Snip properties in B.C.'s Golden Triangle.

Both Eskay Creek and Snip host past producing mines operated by Barrick Gold Corp.

Over a 14-year span ending in 2008, an underground mine at Eskay Creek produced roughly 3.3 million ounces of gold and 160 million oz of silver from ore averaging 45 grams per metric ton gold and 2,224 g/t silver, which at the time made this northwestern B.C. operation the world's highest-grade gold mine and fifth-largest silver mine by volume.

While large quantities of underground resources remain at Eskay Creek, Skeena has focused on deposits that can be mined from the surface since acquiring the property from Barrick in 2017.

According to a calculation completed early in 2019, Eskay Creek hosts 12.71 million metric tons of surface mineable indicated resource averaging 4.5 g/t (1.82 million oz) gold and 117 g/t (47.79 million oz) silver; and 13.57 metric tons of surface mineable inferred resource averaging 2.2 g/t (984,000 oz) gold and 42 g/t (18.46 million oz) silver.

Underground drilling drillers Snip high grade gold project Golden Triangle BC

Skeena Resources Ltd.

Underground drilling at the past producing Snip gold mine in northwestern British Columbia.

This resource calculation does not include any of the results from the 14,266 meters of resource upgrade and expansion drilling carried out during the 2019 phase-1 drill program at Eskay Creek.

In February, Skeena launched a program that is expected to include 28,000 meters of additional drilling at Eskay Creek. With four rigs turning, the company has completed 4,237 meters of this drilling – assay results are pending.

Snip produced 1.1 million ounces of gold from 1.25 million metric tons of ore averaging 27.5 g/t gold during the 1990s.

Gold prices increased five-fold from the US$300/oz since Barrick opted to wind down operations at Snip and the infrastructure in the Golden Triangle has improved significantly in recent years. These factors, combined with the exploration upside at Snip, bode well for revitalizing this high-grade gold mine.

Skeena plans to carry out exploration and resource delineation drilling at Snip this year.

Author Bio

Shane Lasley, Publisher

Over his more than 11 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.

Email: [email protected]
Phone: (907) 726-1095


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