2021 Yukon exploration bounces back
Buoyed by high metals prices, explorers tackle Yukon projects Mining Explorers 2021 - January 27, 2022
Last updated 1/26/2022 at 4:15pm
Mining exploration and production activity soared in Yukon Territory in 2021 thanks to high metals prices, pro-industry government policies, and mounting successes in the field.
Bouncing back from some of the most challenging working conditions in modern history due to the COVID-19 pandemic, placer and hardrock miners stepped up the pace of their activities, posting record production numbers and promising exploration results.
With the rollout of COVID vaccines and the prospect of recovered momentum, Yukon was expected to see increased exploration and deposit appraisal spending in 2021. The northern territory ranked No. 1 among its peers and fifth among all of Canada's provinces and territories for projected spending on mineral exploration and deposit appraisals, according to statistics compiled by Natural Resources Canada.
Projected 2021 spending for mineral exploration and deposit evaluations in Yukon totaled C$98.5 million, up nearly 30% from C$75.9 million for comparable outlays in 2020, but down sharply from comparable pre-pandemic spending in 2019 of C$166.2 million.
The Yukon government marked the ninth consecutive year of its popular mining exploration incentives program in 2021 by again offering financial assistance to numerous applicants with some easing of eligibility requirements for hard rock and placer projects.
While no total sum was released for the 2021 incentives, the Government of Yukon published a list of 50 placer and hardrock projects that received financial assistance last spring.
In 2020, the program awarded more than C$2.5 million to numerous juniors and prospectors for similar mineral exploration programs.
COVID pandemic impact
The COVID-19 pandemic and associated economic recession had a profound impact on Canada and the Yukon. The tourism industry nearly vanished overnight as flights and RV traffic were reduced to a trickle. Fortunately, gold mining was given an essential service green light to continue, albeit amid strict protocols to control the spread of the virus.
The mining industry responded with "an incredible year of activity," spurred on by high gold prices and low fuel costs, according to Yukon officials.
They observed that this scenario, where gold mining provided a safehaven and economic opportunity during global hard times, has played out before in Canadian history.
"The great depression of the late 1800s contributed significantly to interest in the Klondike Gold Rush; the dirty 1930s saw a resurgence in placer gold mining in Yukon, and similarly, the recession of the early 1980s kick-started the modern era of placer gold mining in the territory," according to the Yukon Geological Survey.
"The story of the 2020 pandemic is no different, highlighting the value of economic diversification and ability of a remote northern industry to contribute new wealth to a nation when it is needed most," the YGS noted in its yearly mining overview.
The pandemic's story continued in late 2021, however, as government health officials imposed new restrictions Nov. 8 to rapidly decrease the transmission of COVID-19 and ensure the territory's healthcare capacity isn't overwhelmed. The emergency rules came in the wake of the territory's 12th COVID-related death.
A Whitehorse-based contractor, Pelly Construction, won a C$29.6 million contract in 2021 to construct a new road and bridge for the Carmacks Bypass Project, a key component of the Yukon Resource Gateway Program and a collaborative effort between the Government of Yukon and Little Salmon/Carmacks First Nation.
Scheduled for completion in 2024, it will allow industrial vehicles to bypass the community of Carmacks and improve access to area mining activities such as those underway at Western Copper and Gold Corp.'s Casino copper-gold mine project. It also will enable the Little Salmon/Carmacks First Nation to benefit from contracting, education, and training associated with the project.
The Yukon Resource Gateway Program aims to improve infrastructure that accesses Yukon's most mineral-rich areas. It will provide funding for roughly 650 kilometers (403 miles) of needed upgrades to existing roads in areas of high mineral and mining potential.
In late October, Western Copper and Gold reported completion of its 2021 exploration and drilling program and the start of a feasibility study at Casino. Its exploration campaign, designed with input from investor Rio Tinto, included metallurgical, geotechnical, and resource confirmation drilling, along with a geotechnical program targeting ground conditions for proposed tailings management and heap leaching facilities.
A preliminary economic assessment completed in June envisions a mine at Casino producing 6.5 million ounces of gold, 34.4 million oz of silver, 4.1 billion pounds of copper, and 330 million lb of molybdenum from concentrator and heap leach facilities. The feasibility study is set for completion in the second quarter of 2022.
New land use legislation
The Government of Yukon, meanwhile, is working with First Nations in the territory to develop new mining legislation aimed at improving management of the Yukon's mineral resources in a way that respects First Nations' relationships with the land and supports a modern and sustainable mining industry.
In September, representatives of the territorial government and Yukon's First Nations said the new laws will improve the regulatory system, strengthen the Yukon's economy, protect the environment, and support the modern-day needs of the Yukon.
The legislation will follow commitments set out in the 2003 Yukon Devolution Transfer Agreement, they added.
"Mining in the Yukon must be done in a responsible way, with respect for First Nations' rights and ways of life. Our new legislative regime must take as its starting point the commitments in the Final Agreements," said John Streicker, Minister of Energy, Mines and Resources, Government of Yukon.
"We are pleased that Yukon is, at long last, initiating this important process."
Record placer production
Unlike many hardrock counterparts, Yukon placer miners rose to the challenge of working during the pandemic in 2020 to deliver record-setting production results.
According to government export tax reports, Yukon's 2020 placer gold production totaled 84,900 crude oz as of Nov. 5, the territory's largest output since 1999. With an average season gold price of C$2,506, this resulted in C$170.3 million in production revenue, of which about 87% (C$148 million) entered directly into the Canadian economy during the field season via goods, services, and wages associated with mining.
Field season benefits
Some 93 hardrock mineral exploration projects gained ground in Yukon in 2020, according to Yukon Geological Survey's Mineral Services.
Based on a survey of 2020 Yukon Mineral Exploration Program award recipients, the YGS found that 62 of the program's projects created employment for 148 Yukoners and generated C$3.8 million in direct spending on goods and services with Yukon businesses as well as significant indirect benefit.
Exact numbers for the 2021 field season won't be available until early 2022, but early estimates of increased exploration spending suggest the territory attracted new explorers as well as returning miners to greater numbers of projects.
Dublin Gulch success story
One example of the Yukon Mineral Exploration Program's long-term success is Victoria Gold Corp.'s Eagle Gold Mine and Dublin Gulch Project, the YGS said.
Between 1986 and 2003, various owners of the Dublin Gulch claims received four YMEP grants totaling C$44,000. The funding supported discovery of mineralization and led to a consolidation of the claims and, ultimately, acquisition by Victoria.
Victoria, which took the Eagle Mine on the Dublin Gulch property into production during 2019, has outlined 3.3 million oz of gold on the property with a current value in excess of US$6 billion.
The miner employs about 200 Yukoners, of which half are members of Yukon First Nations. Since the initial C$44,000 YMEP investment, exploration expenditures at Dublin Gulch have exceeded C$110 million, and development spending has topped C$600 million. Yukon officials say the leveraged dollars on exploration spending at Dublin Gulch, alone, represent a ratio of 2,517-to-1.
During the three months ended Sept. 30, the Eagle mine produced 55,827 ounces of gold, compared with 35,312 oz gold in the comparable quarter in 2020.
Victoria attributes the 58% increase in output to increased ore mined and stacked and higher ore grades. The miner also said it anticipates 2021 gold output at the mine to total about 180,000 oz.
Victoria undertook a C$12.5 million exploration program in 2021 focused on its Raven, Lynx, Rex-Peso prospects. At Raven, the company completed 10,000 meters of trenching and 43 diamond drill holes. The company says this drilling encountered long multigram intercepts in 90% of the holes and defined a strike 750 meters long, 400 meters wide, and 180 meters deep that remains open in all directions. Three drills were turning in October as Victoria pursued its goal of developing a maiden resource for Raven by year's end.
At the Lynx target, Victoria dug 15 trenches, built detailed maps of veins and joint sets in trenches as the main focus. More than 100 structural measurements have been recorded. One drill was turning onsite in October.
The miner also chased a silver target at Rex-Peso, west of the Eagle mine, with a 4,000-meter planned drill program.
More silver for Alexco
Alexco Resource Corp. owns and operates most of the historic Keno Hill Silver District in central Yukon, one of the highest-grade silver deposits in the world.
During 2021, Alexco advanced the Keno Hill project toward commercial production. Keno Hill is expected to produce an average of about 4.4 million oz of silver annually in high-quality, lead-silver and zinc concentrates.
In mid-March, the miner launched a large-scale surface exploration program to drill a minimum of 25,000 meters using four drills, focusing on infill and extension drilling of the Bermingham Northeast Deep zone mineralization.
The silver miner used directional technology to increase efficiency and accuracy of the infill drilling. The results were to update an existing Bermingham mineral resource estimate, including the Northeast Deep zone. More than 50 holes were scheduled as part of the directional drilling campaign.
Alexco Resource Chairman and CEO Clynt Nauman said Nov. 9 that the miner completed ore extraction at Bellekeno and is now focused on its two new mines, Bermingham and Flame & Moth, as it moves closer to full production and cash flow self-sufficiency at Keno Hill.
The company also completed drilling on the Bermingham Northeast Deep exploration target, which has returned exceptional interim results with composite assays to 1,681 g/t silver over 20.37 meters true width.
"We are currently advancing the work required to develop a new mineral resource estimate for the Bermingham deposit to include the Northeast Deep zone, to be completed later this year," Nauman said.
Toward the end of 2021, Alexco focused on completing underground development to achieve concurrent ore production from both Bermingham and Flame & Moth mines. With ore from both mines, the miner should reach targeted production levels in early 2022.
WORK at Minto
The Minto Mine, Yukon's first 21st-century mining operation, completed its first full year of operations under new owner Pembridge Resources Plc in 2020.
Mill throughput at this copper-gold-silver mine averaged 2,000 metric tons per day much of the year. The company is working to increase production to 4,000 tpd once it receives a water license for its Minto East II and Minto North II deposits.
The miner also completed 21,411 meters of diamond drilling in 132 holes from surface at the Minto North deposit and from underground at the Copper Keel deposit, encountering copper grades up to 6%. In early 2021, Pembridge reported output exceeding 7,400 metric tons of ore concentrates, up roughly 36% from production in the fourth quarter of 2020.
In November, United Kingdom-based Pembridge completed the formation of Minto Metals Corp., a TSX Venture Exchange-listed company that now operates the Minto Mine.
"We are proud to have been part of re-starting the Minto mine and this new structure is what the mine needs to continue its development," said Pembridge Resources Chairman and CEO Gati Al-Jebouri.
Gold in silver district
Strategic Metals Ltd.'s Mount Hinton project is another exploration success story, according to the YGS. Initial exploration, consisting of prospecting and soil sampling, began in 2018 with support from a YMEP grant. Early results yielded evidence of gold, silver, and lead-rich quartz veins, leading to further exploration in 2019 and 2020.
To date, Strategic has invested C$2.5 million in the project, corresponding to a YMEP leveraging ratio of more than 60:1. The YGS predicts exploration targets defined over the past three years will provide additional economic benefits well into the future.
In April 2021, Strategic Metals optioned Mount Hinton to Upper Canada Mining Inc., which now has the right to earn up to a 70% interest in the project.
The Mount Hinton property lies within the world-famous Keno Hill silver mining camp, a district that hosts more than 35 individual mines and is historically Canada's second-largest primary silver producer. The property covers an 83 square-kilometer (32.3 square miles) area that is located 10 kilometers (six miles) by road from Keno City within the traditional territory of the Na-Cho Nyak Dun. A hydroelectric power grid extends to Alexco Resource Corp.'s Bellekeno Deposit, which is located three kilometers north of the Mount Hinton claim block.
Although silver mineralization is found in veins on the Mount Hinton property, gold is the most significant component in many of the 73 bedrock showings and float occurrences that have been discovered to date.
Mineralized shoots on the veins typically grade between 1 g/t and 30 g/t gold, 50 and 1,500 g/t silver, and 0.5% to 2.5% lead. Maximum grades of 2,340 g/t gold, 30,822 g/t silver, and 75% lead have been assayed in rock samples.
Creeks draining the Mount Hinton property have yielded significant placer gold production and are still being mined. Previous operators also identified numerous soil geochemical anomalies and geophysical targets that have not yet been drilled or trenched. The project is permitted for advanced exploration.
White Gold, Klondike exploration
White Gold Corp. is one of the most active gold exploration companies in Canada's North in recent years. Backed by strategic partners Agnico Eagle Mines Ltd. and Kinross Gold Corp. along with savvy mining investors, including Eric Sprott, the junior is exploring a pipeline of properties, ranging from early to advanced-stage projects across its 420,000-hectare (1 million acres) land package.
The explorer focused in 2021 on 10 of its 30 Yukon properties, including the White Gold, QV, and Betty projects. With an extensive exploration program, the junior reported encouraging results at most of the properties targeted.
White Gold and several other explorers are betting that throngs of prospectors who explored the White Gold and Klondike areas of west-central Yukon over the 136 years since the Klondike Gold Rush left a lot of gold behind.
Another such modern explorer is Klondike Gold Corp., which is pursuing extensive, near-surface gold mineralization at the headwaters of Eldorado and Bonanza creeks in central Yukon.
The Lone Star Zone is situated along Lone Star ridge, the site of the original Lone Star Mine (1912-1914), and other short underground workings called Pioneer and Parnell. On the south side of Lone Star ridge is the Nugget-to-Buckland Zone, and across Eldorado Creek to the south, along the next ridge, is the Violet Zone.
Klondike's Yukon properties also include three more distinct hardrock exploration projects on the Klondike plateau called Dominion, the Gold Run, and Bonanza. In the southeast corner of the Klondike Mining District, the company also owns the McKinnon Creek placer mine featured on the Discovery Channel program, "Gold Rush."
Klondike mounted an extensive drilling program in multiple phases at its Lone Star Project in 2021, following up on encouraging results from 2020 exploration.
In September, Klondike Gold CEO Peter Tallman said results continue to show "the Lone Star Zone discovery hosts significant near-surface gold mineralization which is expandable and remains open in all directions."
Gold explorers make their mark
Gold explorers Rockhaven Resources Ltd., Banyan Gold Corp., and Whitehorse Gold Corp. also made their mark on the Yukon last year.
Rockhaven expanded its 2021 diamond drill program at its Klaza gold-silver-lead-zinc project in the Dawson Range Gold Belt of southern Yukon. A 2020 preliminary economic assessment calculates a 12-year mine life for Klaza producing total payable metals of about 750,000 oz gold and 13.8 million oz silver.
During 2021, three diamond drill rigs completed 14,256 meters of drilling in 72 holes at Klaza. This program was designed to add new resources from structures that lie immediately adjacent to the Klaza deposit, add new resources to Klaza's indicated category by upgrading inferred resources, further define resources with infill drilling, and evaluate exploration targets outside the immediate Klaza deposit area.
"The 2021 program was designed to expand and up-grade the mineral resource base, collect material for advanced metallurgical test work, and continue the collection of data needed for permitting," said Rockhaven Resources CEO Matt Turner.
Banyan had three drills turning at its AurMac project in central Yukon in phase 2 of an extensive 2021 exploration program.
Following up on encouraging results from phase 1 drilling at the project that began in February, the junior's work culminated with 25,000 meters and over 120 diamond drill holes completed by early November.
With planned drilling of more than 30,000 meters, Banyan said it expects assay results for 90-plus drill holes to continue into 2022.
Whitehorse Gold Corp. reported completion of its 2021 exploration and drill program on the Skukum Gold brownfields project in southern Yukon. The junior completed 16,554 meters of diamond drilling in 44 holes on the Skukum Creek, Mt. Skukum, and Goddell deposits, along with property-wide airborne geophysics, surface mapping and sampling of target areas, and camp upgrades.
Base metal explorers
In October, CMC Metals Ltd. said recent exploration at its flagship Silver Hart property in southern Yukon identified high-grade polymetallic samples within calcareous units at its proposed future exploration targets. The explorer also completed detailed mapping and sampling on targets at Silver Hart identified by an airborne geophysical survey conducted in early 2021.
CMC said the work carried out at Silver Hart confirms the merit of the targets for future drilling and the potential of the calcareous units to host high-grade mineralization, with assays returning up to 1,243 g/t silver, 20.06% lead, and 28% zinc. The values were obtained in limestone and skarns that extend more than four kilometers (2.5 miles) southeastwards onto the Blue Heaven property that CMC optioned from Strategic Metals.
CMC Metals published a mineral resource estimate for Silver Hart at the end of 2020 totaling 7.5 million oz averaging 584 g/t silver-equivalent in 362,500 tons, using a cut-off grade of 150 g/t silver- equivalent.
Silver Hart is in the Rancheria Silver District, a 130-kilometer (81 miles) by 50-kilometer (31 miles) belt that straddles the Yukon and British Columbia border about 300 kilometers (186 miles) east of Whitehorse.
CMC also recently acquired the Rancheria South Property in the south-central portion of the district in British Columbia.
Cantex Mine Development Corp. and Fireweed Zinc Ltd. mounted substantial exploration programs at their North Rackla and Macmillan Pass projects, respectively, in 2021 and reported very encouraging results.
Cantex is pursuing lead, zinc, silver, and copper mineralization, while Fireweed is chasing deposits of zinc, lead, and silver. The explorer said it encountered exceptionally strong lead-zinc massive sulfide intersections at North Rackla with strong copper mineralization in extensive drilling.
Fireweed encountered three distinct zones of zinc-lead-silver mineralization in a step-out hole at Boundary West, including a newly discovered zone of high-grade laminated stratiform mineralization similar in style to the nearby Tom and Jason deposits at MacMillan Pass.
ATAC Resources Ltd., long focused on its gold projects near Mayo, looked westward in 2021 and devoted its field season to evaluating the early-stage Connaught copper-molybdenum-gold project located 65 kilometers (40 miles) west of Dawson City.
ATAC said the 137-square-kilometer (54 square miles) Connaught property in the Sixtymile area northwest of Dawson demonstrates compelling copper-molybdenum-gold porphyry potential and hosts 26 distinct silver-lead-zinc-gold-copper epithermal veins.
Granite Creek Copper Ltd., which acquired the Carmacks Copper project in 2020 to complement its adjacent Stu (now Carmacks North) copper-gold-silver property, quickly drilled two holes for 527 meters at Zone 13 on Carmacks Copper and four holes for 738 meters at Carmacks North. Resource expansion drilling completed in 2021 included 22 diamond drill holes primarily targeted at sulfide mineralization in zones 1, 2000S, and 13 and is expected to add to an existing sulfide resource.
Granite Creek said it will incorporate drilling completed in 2017, 2020, and 2021 into an updated resource estimate for the Carmacks Copper project, building on an existing 2017 NI 43-101-compliant resource.
"With the amount of highly targeted new drilling we have completed, we anticipate a robust update to the existing resource estimate," said Granite Creek President and CEO Tim Johnson.
He said this expanded and upgraded resource, combined with the Carmacks Bypass road project, will pave the way for an even more extensive exploration program in 2022.