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Tenacious exploration delivers for Nunavut

Seniors, juniors conduct 2023 seeking variety of minerals Mining Explorers 2023 - January 18, 2024

As 2023 raced toward its final weeks, mining explorers working in Canada's northernmost territory wrapped up ambitious campaigns to identify new deposits of various lucrative minerals, ranging from cobalt to copper and gold to uranium.

Both mineral production and exploration spending in Nunavut decreased in 2022 compared with the previous year's totals, and another drop is expected for 2023.

Natural Resources Canada earlier projected a 28% decrease in planned spending for exploration and deposit appraisals by mining companies working in Nunavut this year.

But late-season budget increases by at least one miner may improve that outlook.

Thanks to relatively stable iron and gold prices, territorial economists anticipate increased mineral production in 2023.

Though "it remains healthy, it could be stronger still with full iron production and the return of gold production from the Hope Bay mine," said Kenny Ruptash, president of the NWT & Nunavut Chamber of Mines

Still, Nunavut officials see an improving economy ahead. They predict major economic growth in the territory in 2024, partly due to more mineral production and steady prices.

This growth is being helped by Baffinland Iron Mines Corp. receiving regulatory approval in September to continue shipping six million metric tons of iron ore 150 kilometers (93 miles) north from its Mary Mine on Baffin Island through Milne Inlet until the end of 2024.

Nunavut Premier P.J. Akeeagok told an audience at the Nunavut Trade Show Sept. 19 that the Nunavut economy is expected to grow by 13.6% in 2024, up from around 7% in 2023.

"I'm happy to report Nunavut's economy is expected to expand strongly this year, at a rate of 7% – that's 6% higher than 2020," he said. "Even better, our growth rate is expected to almost double in 2024, reaching an impressive 13.6%."

Akeeagok cited economic diversification, including within the mining sector, as a key factor, especially during the height of the COVID-19 pandemic.

"While several sectors of the economy contracted during the COVID years, our mining sector expanded in both years by 27% in 2020 and 14% in 2021," he said.

"Ascending gold production and iron ore shipments, coupled with firm commodity prices should (increase) the value of our 2023 mining output," he added.

Rich copper finds

American West Metals Ltd., which carried out impressive resource delineation drilling at Storm, a very high-grade copper optioned from Aston Bay Holdings Ltd., stood out among Nunavut mineral explorers in 2023.

By September, the program had uncovered near-surface copper deposits at Storm and encouraging drill results confirmed thick, high-grade copper mineralization over a growing footprint at this project on Somerset Island off Nunavut's north coast.

"The new Lightning Ridge discovery comes on the heels of the Thunder Zone discovery earlier this summer," said Aston Bay CEO Thomas Ullrich. "We see the massive black chalcocite at the surface near the ridge edge south of the 2750N Zone and are pleased that the drill has confirmed that the mineralization continues at depth. As well, the drilling revealed a second copper zone that we believe is concealed beneath the scree at the bottom of the gully."

Ullrich said both discoveries show potential for identifying additional opportunities to add to the current near-surface delineation program.

High-grade copper mineralization at Storm was first reported in the mid-1990s by Cominco Ltd. geologists conducting regional zinc exploration near their then-producing Polaris lead-zinc mine. Subsequent seasons of exploration by several companies followed.

Aston Bay earned a 100% ownership interest in the project from Commander Resources Ltd., which retains a net smelter royalty interest.

Studies of Storm demonstrated that mineralization grading 4% copper from the 4100N area could be upgraded to a 54% copper direct ship product using standard sorting technology. Drill results from both the 2750N and 4100N zones at Storm confirm continuity of the mineralization, including extremely rich zones, grading up to 43% copper.

In April, America West embarked on a spring delineation drilling program using a helicopter-portable RC drill rig and conducting gravity and moving loop electromagnetic ground geophysical programs. Results from these programs are pending.

The summer 2023 drill program aimed to advance Storm toward a maiden resource estimate by late 2023 or early 2024. Diamond drilling was to test new high-priority gravity targets, and the companies also planned environmental baseline studies.

"Together with the exciting confirmation of sediment-hosted copper mineralization at depth earlier this season, Storm is proving to be a compelling growth story for both near-surface development and deeper breakthroughs," Ullrich said.

New mine, new owner

While work during the field season in Nunavut centered mainly on appraising known deposits and showings, plus expanding existing deposits near established mines, several companies reported progress in moving their mine projects toward production.

This includes B2Gold Corp., which acquired the Back River gold project in northwestern Nunavut from former owner Sabina Gold & Silver Corp. early last year.

"We are excited to add such a high-quality, high grade gold project in a top mining jurisdiction to our global portfolio, and we are thrilled to welcome the exceptional Sabina team into B2Gold," B2Gold President and CEO Clive Johnson said upon the closing of the deal to buy Sabina.

A feasibility study updated in 2021 envisions a mine at the Goose deposit that will produce 3.34 million ounces of gold over an initial 15 years of operation, or an average of about 223,000 oz annually.

B2Gold expects to complete mine development and pour the first gold at Goose in early 2025 and estimates the project's capital cost at C$890 million.

Underground mining at the Goose project is now scheduled to include 150,000 oz from the crown pillar of the Umwelt Zone not included in the original plan.

The Umwelt underground will also be mined with long-hole stoping, which could reduce costs and increase ore production rates. B2Gold also plans to identify other changes aimed at further de-risking Sabina's original plan for the mine's construction phase and maximizing the long-term value of the asset.

B2Gold also explored the wider potential of Back River with a US$20 million (C$27 million) exploration program that included more than 28,000 meters of drilling and reconnaissance exploration on its newly acquired project during 2023.

"As we continue with the construction of the Goose project and move toward commencement of production in 2025, our exploration program will also start immediately," Johnson said in April. "We aim to further define the Back River Gold District's untapped potential and unlock the significant value we see and opportunities for growth."

More gold output in Nunavut

Agnico spent 2023 expanding beyond known gold mineralization at its two mining operations, Meliadine and the Meadowbank Complex, which are both located in the central Kivalliq region, and continuing its reassessment of the geology of its Hope Bay Mine complex in the territory's Kitikmeot region where the miner suspended operations shortly after acquiring the asset in 2021.

During the first nine months of 2023, Agnico reported payable gold production of nearly 2.54 million oz, up slightly from output in the same year-ago period.

This increased production was despite several challenges during the first nine months of 2023, including an early caribou migration.

Gold output at Agnico's Meliadine Mine during the first nine months of the year decreased when compared with the prior-year period due mainly to lower gold grades, partially offset by a greater volume of ore processed due to the mine's processing plant delivering overall strong performance in the third quarter and the mine's open pit performed above plan.

Agnico said phase 2 of an ongoing mill expansion at Meliadine is expected to be completed in mid-2024 and a processing rate ramp-up could increase throughput to 6,000 metric tons per day and be in operation by the end of next year.

Work on phase 2 construction continued in late 2023. A secondary grinding building is under construction and should come online in mid-2025.

Positive drill results

At Meliadine's Tiriganiaq deposit, an ongoing extension of the exploration drift to the east and west provided access to new areas of mineralization, and during the third quarter resulted in more positive drill results in areas towards the east at depth. This includes the 3.1 meters averaging 11.4 g/t gold cut in hole ML425-9563-D21.

Agnico said drilling from surface since the beginning of 2023 in the easternmost portion of Tiriganiaq shows potential for further extension of underground mineral reserves towards the east at relatively shallow depth.

Exploration during the quarter also focused on conversion drilling at the Wesmeg North deposit, and conversion and exploration drilling in shallower portions of the Pump North and Pump South deposits.

Drilling also continues to investigate vertical extensions of mineralized zones in the central part of the mine's Tiriganiaq, Wesmeg and Wesmeg North deposits.

Favorable surface and underground exploration drilling at Meliadine led Agnico to approve a supplemental budget of C$7 million for the second half of 2023 to drill another 25,000 meters.

During the three months that ended Sept. 30, Agnico's Meadowbank Complex, also located in central Nunavut, delivered a particularly strong performance.

For the first nine months of 2023, gold output at Meadowbank climbed to 322,440 oz, compared with 279,457 oz during the same period a year ago.

Agnico said this increase reflects robust overall operational performance, record haulage of underground ore, higher gold grades in underground production and a higher-than-anticipated grade sequence in the Whale Tail and IVR open pits during the first quarter.

The Meadowbank complex is expected to generate strong returns in 2024 and 2025 with annual production between 470,000 and 505,000 oz, but production is expected to decline in 2026 and 2027 as the current mineral reserve base is depleted. Exploration efforts are underway with the objective of delineating additional mineralization at the Amaruq satellite deposit and work is ongoing to evaluate the potential to extend the mine life of the Whale Tail and IVR pits beyond 2027.

Ongoing exploration

At the Hope Bay project, exploration continued during the third quarter of 2023 with seven drill rigs targeting the Doris and Madrid-area deposits and regionally for a total of 31,074 meters completed in 46 drill holes, bringing the total to 119,771 meters completed in 194 holes during the first nine months of 2023.

Exploration at Madrid remained focused on drilling wide step-out holes spaced 200 meters apart into the underexplored 2,000-meter strike extension gap between the Suluk and Patch 7 deposits at depths between 400 and 700 meters.

A new highlight intercept in hole HBM23-109 returned 15.9 g/t gold over 4.6 meters at 609 meters depth and roughly 300 meters beneath the Patch 7 mineral resource.

The exploration drilling programs at Doris and Madrid recently ramped down for the seasonal transition and are expected to resume at full capacity when snow- and ice-based drilling is suitable in January. The explorer said it intends to continue its wide step-out strategy at Madrid to assess the mineral resource potential of the gap between Suluk and Patch 7 as well as the area south of Patch 7.

Based on positive results at Doris and Madrid during the first half of 2023, Agnico approved a supplemental exploration budget at Hope Bay of C$14.5 million to drill another 58,000 meters by year's end. Previously, the exploration budget at Hope Bay for the full year was C$30.6 million to drill 72,000 meters.

A regional exploration program also got underway at Hope Bay in May, with one drill rig testing anomalies identified during the 2022 and 2023 field seasons on targets near the Koignuk fault, four kilometers (2.5 miles) northwest and outside Madrid mineralization.

Agnico is studying larger production scenarios for Hope Bay.

Advanced exploration

Canadian Resources Ltd. is a critical minerals explorer that reported significant progress in 2023 toward developing a new mine at its Ferguson Lake project in central Nunavut.

According to a 2022 calculation, Ferguson Lake hosts 24.3 million metric tons of indicated resource averaging 0.85% (455.4 million pounds) copper, 0.6% (296.3 million lb) nickel, 0.07% (37.5 million lb) cobalt, 1.38 grams per metric ton (1.08 million ounces) palladium, and 0.23 g/t (180,000 oz) platinum; plus 47.2 million metric tons of inferred resource averaging 0.91% (946.9 million lb) copper, 0.53% (551.5 million lb) nickel, 0.06% (62.4 million lb) cobalt, 1.4 g/t (2.12 million oz) palladium, and 0.25 g/t (380,000 oz) platinum.

Since this calculation, the explorer added results of 39,270 meters in 145 holes of new diamond drilling to the project database for the completion of an updated mineral resources estimate.

The new mineral resource model will include both mineralization types and reflect significant extensions of mineralized zones defined by the explorer's drilling.

In addition to raising substantial capital to fund more exploration of the large base and platinum group metals project, Canadian Resources also secured two economic development grants, totaling C$500,000 from the Government of Nunavut's Discover, Invest, and Grow (D. I. G.) program to assist its efforts.

Tenacious explorer

A handful of juniors, following up on promising results from past years, carried out exploration campaigns in 2023, and reported substantial progress in expanding known mineralization on the properties they have explored at least for several years.

Blue Star Gold Corp. continued its hunt for more gold zones on its Ulu gold project, which covers more than 45 kilometers (28 miles) of the highly prospective and underexplored High Lake Greenstone Belt in western Nunavut.

The company's more than 14,000-hectare (34,594 acres) land package includes the Ulu mining lease, which hosts the advanced stage Flood Zone gold deposit; the contiguous Hood River property, where a significant high-grade gold resource has been outlined; and underexplored Roma project, which covers the northern section of the High Lake Greenstone Belt.

By revisiting and evaluating all the historically defined showings on its properties, Blue Star said it could better prioritize their potential. About 80% of the pipeline targets have been revisited, including base metal targets.

The company's geologists collected 319 samples this season with assay results ranging from detection limit to 47.6 g/t gold.

Among 2023 exploration highlights:

Discovery of the Mikigon prospect, a 500-meter structure that sampled 47.1 g/t gold at surface.

A sample with visible gold from the Auma prospect returned 47.6 g/t gold.

Sampling at Penthouse confirmed a precious metals-rich, base metal prospect.

The explorer also identified new showings north of the North Fold Nose resource area, which returned 5.5 g/t and 3.03 g/t gold from quartz vein samples, and 8.78 g/t gold from sulfide pod in deformed sedimentary rocks, along with several other pipeline targets, returned elevated gold values.

"The discovery of the Mikigon prospect this year, and the high sample grades returned from numerous other areas highlight the exceptional new discovery potential at the company's projects," said Blue Star CEO Grant Ewing.

Though Blue Star is focused on refining gold targets for its next discovery drill program, Ewing said the explorer is adding a significant secondary focus on critical minerals as it continues to assess and refine its target pipeline.


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