Mineral riches lure explorers to Yukon
Government, industry focus on First Nation relations, roads Mining Explorers 2019 – Published Nov. 1, 2019
Last updated 8/5/2020 at 5:40am
Though mineral exploration in Yukon Territory this year lagged the pace seen in 2018, mine development projects advanced at a steady clip in 2019, while several past-producing mines moved toward resuming output.
Yukon ranked fourth in Canada for projected spending on mineral exploration and deposit evaluation for 2018, according to statistics distributed by Natural Resources Canada. Spending for mineral exploration and deposit evaluations totaled C$249.4 million, made up of C$142.6 million for exploration and C$106.8 million for deposit evaluations.
Projected spending for 2019, however, is sharply down from year-ago levels.
So far in 2019, the territory has attracted exploration expenditures totaling C$112 million, with only 61 active projects, according to the Yukon Geological Survey.
The Yukon government marked the seventh consecutive year of its popular mining exploration incentives program in 2019 by offering C$1.4 million to applicants with eligible hard rock and placer projects.
Reduced by C$200,000 from C$1.6 million a year earlier, the program helped numerous juniors and prospectors carry out small exploration campaigns, including several explorers seeking vanadium and tin, according to Scott Casselman, head of YGS' Mineral Services.
The C$200,000 cut from the incentives program also enabled the YGS to hire a mineral assessment geologist to assist with new projects, including development of the Beaver River Land Use Plan, which is needed for construction of an access road to connect Yukon's existing highway system with ATAC Resources Inc.'s Tiger Project.
In 2019, outreach initiatives aimed at improving understanding and awareness of First Nations with traditional territories and rights within the northern territory took center stage.
The Yukon Chamber of Mines, for example, recognized important contributions to Yukon mining made by the First Nations and their individual members, dating back to the Klondike Gold Rush of the 1890s.
In January, Kate Carmack was inducted into the Canadian Mining Hall of Fame, joining the so-called "Klondike Discoverers" – Skookum Jim Mason, Dawson Charlie, George Carmack and Robert Henderson – who received the honor together in 1999 for the discovery that led to the Klondike Gold Rush.
"As a First Nation woman, Kate considered herself equal to any man. Having her recognized as a mining icon after years of obscurity, is one step towards reconciling all First Nation roles in historical events and the contribution women have made in mining," Zena McLean, one of Carmack's descendants, told a Toronto audience as she accepted the award.
Yukon First Nations have believed, for generations, that Kate Carmack found that first gold nugget in 1896. As a result, an article written by Eileen Vance-Duchesne in the summer of 1999 highlighted the earlier induction oversight.
"For a lot of us, it feels like a past wrong being righted," commented Yukon Chamber Mike Burke at the ceremony. "It's probably the most meaningful and significant piece of reconciliation the Yukon Chamber of Mines has been associated with."
Burke said the Yukon mining industry is committed to working with Yukon First Nations and women to ensure the industry is more inclusive and representative. "If there is to be a future for mining in the Yukon, it can only be achieved through respect and meaningful collaboration with Yukon's First Nations," he added.
A few weeks later, the chamber unveiled an online reference guide for mineral explorers and others in the mining industry on requirements and expectations in Yukon Territory for engagement and consultation with the territory's First Nations.
Titled, "Yukon First Nations Engagement & Consultation Tool Website and Mobile App for the Mineral Exploration Industry," the guide not only provides information about all 14 Yukon First Nations and three indigenous groups centered outside Yukon with interests in the territory, it also provides a comprehensive information base across all traditional territories in Yukon with a summary of engagement and consultation best practices designed to encourage mutually beneficial partnerships. Available via print, website and mobile app, the guide gives a brief history of Yukon, mining success stories that emphasize mutually beneficial relationships with First Nations and other important information otherwise difficult to find in one place.
2020 outlook brighter for Yukon
Yukon mining activity slowed dramatically in 2019 and economic growth in the territory is expected to follow suit before rebounding in 2020, according to the Conference Board of Canada.
New mines coming online will drive economic growth in Yukon next year, said economists in the Conference Board's "Summer 2019" report.
"Territorial economies are being positively impacted by new mines that are propelling growth in the next few years," said Marie-Christine Bernard, director of provincial and territorial forecast at the Conference Board. "However, some of the countervailing winds are the slower Canadian economy compounded by higher geopolitical risk (i.e. Brexit) and weaker growth in the global economy."
Yukon's annual unemployment rate is expected to remain well below 4 percent during the next several years, and labor shortages will become a problem in the territory.
Yukon wages, however, will grow at an average annual pace of 3 percent between now and 2025, which is "much faster than inflation," the economist said.
Major road projects advance
Yukon's government, meanwhile, focused on road and infrastructure improvements in the territory. The Canadian government, Yukon government and private industry agreed in 2017 to spend C$469 million on about 650 kilometers (524 miles) of upgrades of existing roads in the Dawson and Nahanni ranges – two key areas of high mineral potential and active mining in Yukon.
In April, Yukon and the Little Salmon Carmacks First Nation reported reaching an agreement to proceed with construction of a proposed bypass road around the community of Carmacks, located about 70 kilometers (46 miles) southeast of the Freegold Mountain project. The bypass, part of the Yukon Resource Gateway Project, will significantly reduce traffic flow through the community by redirecting industrial traffic, such as large ore-hauling trucks, around Carmacks on a new north-south thoroughfare.
The bypass pact is the first project agreement for the Gateway Project, which is also funding an upgrade to 82 kilometers (51 miles) of the existing Freegold Road, which provides access to all portions of the Freegold Mountain property and to other mineral-rich properties.
"This agreement is one of a series of project agreements we are hoping to finalize with affected First Nations," said Yukon Minister of Energy, Mines and Resources Ranj Pillai in announcing the agreement. "This new road, along with the other new and improved roads related to the Yukon Resource Gateway Project will help enhance the development of Yukon's mineral resource sector."
The Carmacks bypass also will improve access to the Mount Nansen site and assist the territory's remediation efforts, Pillai added.
In addition to the bypass project, upgrades to the Casino Road and new road construction between the Casino and Coffee terminus points are planned. The Nahanni Range component of the Gateway Project involves upgrades to the existing Nahanni Range Road from its junction with the Campbell Highway to the Northwest Territories border.
In July, the Yukon officials also reported approval of C$157 million in federal and territorial funding for reconstruction and rehabilitation of critical portions of the North Klondike Highway between Carmacks and the Dempster Highway cutoff. The project, scheduled to start in 2020 and be completed in 2027, is designed to increase safety, help grow Yukon's mineral resource sector, and reduce the costs of highway maintenance.
Mines on the cusp
Yukon has at least a half-dozen mine projects nearing production, including three mines that ceased output within the past decade.
The Minto copper-gold mine, about 240 kilometers (145 miles) northwest of Whitehorse, shut down last fall after owner Capstone Mining Corp. failed to complete a sale of the operation to UK-based Pembridge Resources Ltd. This spring Pembridge agreed to pay up to US$20 million for the mine to Capstone in staged payments that hinge on the mine going back into production and the price of copper. The buyer aims to return Minto to production by year's end and mount new exploration to extend its current four-year mine life.
Alexco Resource Corp. shut down the Bellekeno Mine in 2013 due to low silver and base metal prices. The company has continued to explore its property in the Keno Hill silver district to build resources in hopes of re-starting silver output when prices rebound. Alexco is currently advancing its Bermingham and Flame & Moth deposits toward production.
This spring the explorer began a surface exploration program near the Bermingham deposit with at least 7,500 meters of drilling. Alexco also reported an indicated resource (including reserves) for Bermingham, totaling 32.9 million ounces silver averaging 930 grams per metric ton. The deposit remains open to the northeast and at depth.
The Wolverine Mine, a volcanogenic massive sulfide operation that began production in 2011, is on care and maintenance after being shut down and flooded by owner Yukon Zinc Corp. in 2015 due to low metals prices. In October 2018, the Yukon government said the mine had been sold to a new owner that is working to resume production.
At the historic Brewery Creek gold mine near Dawson, owner Golden Predator Mining Corp. is also working to resume production.
Golden Predator gave the Yukon government formal notice Aug. 25 that it is moving the mine into the production phase from temporary closure status. The notice formally advises Yukon of the commencement of development/production activities on the Brewery Creek site and has been accepted by Yukon officials.
A licensed brownfields heap leach gold mine that Viceroy Minerals Corp. operated from 1996 to 2002, Brewery Creek was closed in 2002 following a collapse of the gold price to less than US$300/oz.
Golden Predator commenced work on restarting the mine project in 2009.
Exploration near new mine
At the new Eagle Gold Mine, Victoria Gold Corp. reported 95 percent completion of construction in June and plans to pour first gold in the third quarter of 2019. Eagle is expected to produce about 200,000 oz gold annually over a 12-year mine life.
Victoria is also continuing exploration of the Dublin Gulch property where the Eagle mine is located. Work in 2019 focused on the Nugget zone about 12 kilometers (7.5 miles) east of the Eagle deposit. A diamond drill program planned at Raven for 2019 will test a coincident gold, arsenic and bismuth in soils anomaly defined from the 2018 soils geochemical program. Victoria said the 2019 program also will test other targets identified in 2018 exploration.
Western Copper and Gold Corp. reported progress in developing an open pit copper-gold mine at the porphyry copper-gold-molybdenum Casino property as a conventional flotation mill and gold heap leach mine. The project boasts 965 million metric tons mill ore and 157 million metric tons heap leach material in proven and probable reserves, containing 4.5 billion pounds copper and 8.9 million oz gold, plus additional resources.
Currently in the adequacy stage of permitting for production beginning in 2021, the explorer conducted a C$3.3 million drill campaign at Casino in 2019 aimed at converting inferred mineralization to the indicated category. With 6,000 meters completed by July, Western Copper said successful exploration would extend the project's estimated 22-year mine life.
Goldcorp Inc., which completed a merger with Newmont Mining Corp. in April to become Newmont Goldcorp Corp., one of the largest gold miners in the world, hopes to develop a gold mine at the Coffee project in central Yukon.
Prior to the merger, Goldcorp aimed to develop Coffee, as an open pit, heap leach mine by 2021 and produce about 2 million oz gold from the deposit located in the White Gold district of the Dawson Range.
The project stalled in 2017 due to consultation issues with local First Nations. The project is currently being reviewed by the Yukon Environmental and Socio-economic Assessment Board.
Explorers return to Yukon
Yukon attracted a score of other explorers with 2019 programs targeting a variety of projects, from very early stage prospecting to follow-up drilling. Prominent among this group are:
ATAC Resources Ltd., which continued work at its extensive Rackla Gold project in northcentral Yukon. The western part of the property, the Rau Trend, includes the Tiger carbonate replacement gold deposit (5.68 million metric tons of measured and indicated resources averaging 2.66 g/t (485,700 oz) gold). YESAB recommended construction of an access road to the site, but final approval for the artery is pending.
The 2019 program focused on follow-up exploration at the Rau project near the newly discovered Bobcat gold-copper skarn target where gold, copper, silver and tin anomalies were identified in 2018. By July, the explorer had expanded the gold-copper target and begun diamond drilling in the area.
ATAC optioned the central part of the Rackla Gold property (Orion) to Barrick Gold Corp. in 2017, but the major terminated the option at the end of 2018 after completing a 7,410-meter (16 holes) diamond drill program that intersected high-grade gold in four step-out holes along the Anubis fault.
ATAC Resources' eastern portion of the Rackla belt is the Osiris project, which hosts the Conrad, Osiris, Sunrise and Ibis Carlin-style gold zones.
Triumph Gold followed up in 2019 on aggressive exploration of the Freegold Mountain copper-gold project in recent years in hopes of identifying the causative intrusion at depth that delivered rich and varied mineral deposits across the 202 square kilometers (78 square miles) of contiguous claims. The explorer planned to drill a minimum of 5,000 meters in five holes that targeted high-grade, gold-rich, copper-gold porphyry-style mineralization identified in 2018, including a 1,600-meter hole in the Blue Sky Zone – the deepest hole ever drilled by mineral explorers in the Yukon – as well as 1,000-meter holes to test other targets on the property.
White Gold Corp. also continued to explore its large portfolio of properties in western Yukon in 2019 with a C$13 million campaign designed to follow up on the Vertigo discovery at its JP Ross property; expand the Golden Saddle and Arc resources on the White Gold property with diamond drilling on the GS West discovery and other nearby targets; and increase the 230,000 oz VG resource (4.4 million metric tons grading 1.65 g/t gold inferred resource at a cut-off of 0.5 g/t gold) on the QV property that it acquired from Comstock Metals Ltd.
Klondike Gold Corp. mounted a C$2 million exploration program in 2019 at its 576-square-kilometer (about 222 square miles) Klondike District Property south of Dawson City. The explorer targeted prospective areas of high-grade gold mineralization near 2018 drilling successes at the Gay Gulch and Nugget zones, as well as Lone Star Zone expansion targets. In early August, Klondike reported drilling 913 meters in 12 holes in the Nugget Zone, intersecting intervals of high-grade gold and discovering a new parallel zone of high-grade mineralization. Klondike is also testing other high-priority gold targets at the Bonanza, Nugget and Eldorado Fault areas with soil sampling, GT-Probe deep overburden drilling and Lidar surveys.
Other Yukon explorers seeking precious metals in 2019 include: Luckystrike Resources Ltd. returning to its Lucky Strike property in the White Gold district; Stratabound Minerals Corp. exploring its Golden Culvert Project in Southeast Yukon; Banyan Gold Corp. exploring the Aurex-McQuesten Project near Keno in central Yukon; Strategic Metals Ltd. exploring three properties in southwestern Yukon – Meloy (copper-molybdenum-gold-silver), Sixty Mile (porphyry copper-silver-gold-molybdenum) and Hartless Joe (gold-silver), and several others; Aben Resources Ltd. exploring its Justin Gold project in southeastern Yukon; StrikePoint Gold Inc. exploring its Golden-Oly and PDM projects near the North Canol road in eastern Yukon; and Metallic Minerals Corp. followed up in 2019 on early-stage exploration of its Keno Silver project located near Alexco Resource's silver project in the Keno Hills silver district. Newmont Mining terminated an option it took on Goldstrike Resources Ltd.'s Plateau property at year's end 2018, after drilling 7,753 meters in 26 holes, collecting soil samples and ground geophysical surveys.
Base metals exploration heats up
Fireweed Zinc Ltd. continued exploration of the historical Tom and Jason sedimentary exhalative lead-zinc deposits on its MacMillan Pass property in eastern Yukon. The junior carried out drilling, ground gravity and airborne Lidar surveys, geological mapping, sampling, and prospecting this year.
Cantex Mine Development Corp. mounted an exploration program in 2019 to follow up its 2018 discovery of massive sulfide mineralization containing galena and sphalerite at its 14,077-hectare (34,784 acres) North Rackla property in central Yukon. The explorer planned to drill 17,000 meters in the Massive Sulphide Zone this year and conduct geophysical and geochemical surveys on the property.
Nickel Creek Platinum Corp. said in August it will conduct a modest geophysics and sampling program at its Nickel Shaw project in southwestern Yukon that is designed primarily to test the Quill exploration target area, which lies along trend about 1,700 meters to the southeast of the 2,800-meter main Wellgreen deposit. Last year, the company reported an updated measured and indicated resource of 323 million metric tons containing 1.9 billion pounds nickel, 1.1 billion lb copper, 107 million lb cobalt and 5.8 million oz of combined platinum group-metals and gold. The new resource was recalculated after metallurgical tests demonstrated a strong correlation between higher total sulfide content and higher nickel recovery.
Alianza Minerals Ltd. returned to Haldane, a high-grade silver property in the historic Keno Hill Silver District where it identified two new soil anomalies and expanded two known soil anomalies a year earlier. In phase 1 of the junior's 2019 exploration program, the explorer said it will take soil geochemical samples, and conduct mapping and trenching designed to refine targets for drilling, planned for August. The 8,579-hectare (21,199 acres) Haldane Property is located 25 kilometers (16 miles) west of Keno City, in the western portion of the Keno Hill Silver District.
At least one company was exploring for cobalt in Yukon. Go Cobalt Mining Corp., which changed its name in mid-2019 to Go Metals Corp., reported completion of a 2019 exploration program at its Monster copper-cobalt Monster project and plans for a late summer follow-up program, including trenching and soil work over the Bloom target. The junior identified multiple new copper-cobalt mineralized outcrops with results pending from spring and early summer exploration. Go Metals also said alteration mapping and sampling confirms potential for a large iron oxide copper-gold (IOCG) system at Monster.