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Mining News: Underworld gets back into Golden Saddle Junior with ties to Full Metal kicks off second season of drilling at its White Gold property near Dawson City with new discovery Shane Lasley Mining News
Underworld Resources Inc. struck a much thicker band of gold-rich mineralization in early drilling this season, the company reported May 26.
Initial assay results from the Vancouver BC-based junior’s second season of drilling into the Golden Saddle zone at the White Gold property in Yukon Territory revealed a new 100-meter-thick band of gold mineralization much deeper than the original near-surface discovery. The new zone, roughly 100 to 200 meters deep, averaged more than 3 grams per metric ton gold in two of the three holes that returned significant mineralization.
Gold majors are said to be keeping an eye on Golden Saddle and the team of veteran geologists exploring it. The discovery is located about 95 kilometers, or 59 miles, south of the historic mining town of Dawson City, Yukon.
Two executives from Full Metal Minerals have teamed up with the former South Pacific exploration manager for Placer Dome, Adrian Fleming, to form Underworld. Fleming serves as Underworld president and CEO, while Full Metal Vice President of Exploration Robert McLeod also serves as Underworld’s vice president of exploration and Full Metal President and CEO Michael Williams is Underworld’s chairman.
This seasoned team of geologists is exploring a gold discovery, located at the confluence of the White and mighty Yukon rivers with roots that can be traced back to the days of the Klondike Gold Rush.
While the 169-square-kilometer, or 41,760-acre, White Gold property has several vein-hosted gold occurrences, Underworld Chairman Michael Williams said the junior is focusing more on the Golden Saddle-style mineralization.
Clearly intrusive Underworld President Adrian Fleming told Mining News May 26 that the Golden Saddle mineralization “is clearly intrusive-related,” which means igneous rock with gold was forced while molten into cracks or between other layers of rock at the prospect millions of years ago .
Williams said geologists are finding similar soil geochemistry at some of the other showings along a 7.5 kilometer-, or 4.6 mile-, long-trend at the White Gold property. He said the company will trench these prospects and follow up with drilling in the areas that show promise.
The junior is also excited about indications of intrusive-style mineralization at its newly acquired Thistle property, which lies adjacent to White Gold to the south.
Underworld, which recently raised C$3 million, started its 2009 drill campaign at White Gold in early May with 4,000 meters of first-phase drilling planned with two rigs turning to follow up on discoveries made at the Golden Saddle and Arc mineralized zones in 2008.
Fleming said the drill crews at White Gold, which are drilling about 80 meters per rig a day, are on pace to complete phase-1 drilling in early June. Drilling is planned to resume in late June or early July.
Fleming said Underworld is considering two additional 4,000 meter programs this year.
Golden Saddle tops priorities The higher-grade Golden Saddle is the first target of the phase-1 2009 drill program that kicked off May 7. Two weeks into the program drill crews have completed nine holes at Golden Saddle.
Underworld, which was hoping assays from this year’s drilling at Golden Saddle would duplicate the 4-grams-per-metric-ton average gold encountered during 2008 drilling, was not disappointed when it received the first results of the 2009 program.
WD09-28, the first hole of the 2009 drill program intersected 102.5 meters with an average grade of 1.84 g/t gold starting at a depth of 105 meters, and includes 22 meters grading 3.99 g/t gold. WD09-31 revealed the best results with 104 meters at 3.39 g/t gold, including 43.3 meters averaging 4.37 g/t gold. The junior is still waiting on additional assay results from this hole.
The holes were drilled in a fence of four this spring to test for the continuity and depth of mineralization discovered last year in hole WD08-21, which cut 50.7 meters grading 3.1 g/t gold and bottomed in alteration and in mineralization. The holes were drilled west of hole 21.
Drilling performed last year at Golden Saddle outlined a 450-meter-by-170-meter zone of mineralization that is shallow-dipping from the surface to the northwest.
Hole WD08-04, the first successful hole into Golden Saddle, cut 18.1 meters grading 4.35 g/t gold. This hole was typical of the consistent width and grades of the zone. Subsequent drilling at Golden Saddle outlined a 450-meter-by-170-meter zone of mineralization that shallowly dips from the surface to the northwest.
Fleming said the early drilling results clearly indicate that hole 21 was stopped while still in mineralization.
Underworld geologists believe the mineralization discovered in hole 21, and delineated further by the initial assay results of the program this year, may be a separate zone than the mineralization traced from surface in 2008.
WD08-20, drilled about 150 meters south of hole 21, intersected 27.7 meters grading 1.87 g/t gold starting at two meters below the surface.
“The (2009) mineralization looks similar to what was encountered last year; but hole 20 may be in a separate zone entirely from (hole) 21 and (holes)28-31,” McLeod told Mining News May 26.
The exploration vice president said the junior will drill deeper in all directions to better define the geology of this richer mineralized zone.
Underworld plans to complete an NI 43-101 resource estimate for Golden Saddle by year’s end.
Further drilling at Arc Drill crews also have completed one hole this year at the Arc Zone, which lies about 1,000 meters southeast of Golden Saddle.
Fleming said he has four holes of phase-1 drilling scheduled to further test the 2,000-meter Arc soil anomaly that led to the discovery of this gold prospect.
The two holes drilled at Arc in 2008 intersected a lower grade of gold mineralization than that encountered at Golden Saddle.
The first encouraging intercept in the Arc Zone occurred in drill hole 14, which cut through 28.5 meters averaging 1.18 g/t gold. Hole 17, located 600 meters northwest of hole 14, intersected 29 meters with an average grade of 1.47 g/t gold.
Though the grades are lower at Arc than Golden Saddle, Fleming said Arc has the potential to add large amounts of gold to the property due to the enormous size of the soil anomaly.
Junior expands White Gold Two property deals announced in mid-May increased Underworld’s land position at White Gold by 62.5 percent.
The junior has secured the rights to parts of the Cathy claims and all of the Cath and WS claims. These properties expand the White Gold properties to the east and south.
The Underworld team is particularly interested in the Thistle property immediately south of the recently expanded White Gold property. Thistle consists of 86 claims that lie on the southern side of Thistle Creek, which historically produced about 63,000 ounces of placer gold.
Williams told Mining News that geologists are currently mapping the Thistle property and see indications of intrusive style mineralization. He said Underworld plans to begin drilling the highly prospective property later this year.
Klondike reference leads to discovery Underworld holds an option to earn a 100 percent interest in the Yukon projects from prospector Shawn Ryan, who identified and staked the claims several years ago.
Ryan’s discovery of the White Gold prospect began when he encountered an enigmatic reference, recorded in government records in the late 1800s that one William Ogilvie sold a rock for C$20,000 that was found near the confluence of the White and Yukon rivers.
Early prospectors recorded further indications of gold showings in the area in 1914, but no one had been able to pinpoint a substantial deposit, Ryan said.
In 2003, with the help of modern exploration tools, the prospector believes he found the source of the historic rock on the White Gold property. Following his initial discovery Ryan and Yukon Geological Survey geologist, Michael Burke, returned to inspect the discovery. The duo uncovered two significant gold veins, Mike Vein and Ryan’s showing, on the property now being explored by Underworld.
Ryan followed up his discovery with an extensive soil sampling of the White Gold property.
Exploring other prospects Underworld trenched at Ryan’s Showing in 2008, but drilling did not reveal the encouraging results found at the surface.
“We drilled some veins last year at Ryan’s. We trenched it the year before and got some really good results but when we went to test it at depth with a drill we didn’t duplicate the results we saw at surface,” Williams said.
The junior plans to explore several other prospects on the property. The Teacher’s showing, which lies on the north end of the property, is one target for exploration this year.
Teck located and explored Teacher’s in 1998 but released the claims two years later. Williams said the junior will start off trenching areas with geochemical signatures similar to Golden Saddle, and, if the results are encouraging, the company will follow-up with drilling. Underworld plans a similar program at the Donahue zone at the south end of the property.
Williams said the property has attracted the attention of the majors. Kinross, which has the right to maintain its 9.9 percent interest in Underworld, opted to hold on to its share of the junior’s equity during financing completed this spring.
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