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MINING NEWS: Gold Crest teams with gold giants Newmont Mining Corp., Electrum Ltd. sign joint venture agreements with junior on Southwest Alaska gold properties Shane Lasley Mining News
After years of exploring Southwest Alaska on its own, Gold Crest Mines Inc. has teamed up with Newmont North America Exploration Ltd., a subsidiary of Newmont Mining Corp. in three separate ventures and with Cougar Gold LLC, a wholly-owned affiliate of Electrum Ltd., on five other gold properties in the region.
Gold Crest May 12 said its subsidiary, Kisa Gold Mining Inc., signed joint venture agreements for the three gold properties. Three weeks before on April 24, the Spokane, Wash.-based junior said it inked the JV pact with Cougar Gold.
Electrum to explore five properties The Electrum JV covers five gold properties in the Kuskokwim region of Southwest Alaska about 90 miles southeast of Bethel. The claim groups included in the agreement—Kisa, Gold Lake, Gossan Valley, Little Swift and Gold Creek—total 15,320 acres.
The agreement gives the Denver-based global gold explorer the opportunity to earn 55 percent interest in the properties by spending $3.5 million over the course of three years—$750,000 the first year, $1.25 million the second year and $1.5 million the third year. Electrum has the option to earn another 25 percent by spending another $2.5 million over two years following the initial earn-in period. The company also has invested $250,000 to purchase 1,666,667 in Gold Crest shares at 15 cents per share.
Gold Crest began exploring the Kisa Project in the Kuskokwim Mineral Belt of Southwest Alaska in the fall of 2006. The exploration program started out with a 3,500 line-mile airborne geophysical survey of the region, followed up by more than 600 stream sediment samples.
Based on the results of the early-stage exploration program the junior explorer drilled six holes totaling 3,107 feet of drilling that targeted an outcropping on the Kisa claims.
The sample results indicate the presence of a very large disseminated gold-bearing intrusive system on the property, according to Gold Crest. Assay intervals containing up to 8.6 grams per metric ton suggest the possibility of higher-grade zones within the intrusive breccia complex.
“This area has been neglected by the mining industry for 20 years. We went out there to look, and we found the streams, rocks and soils associated with (known gold mineralization),” Chris Dail, Gold Crest’s vice president of exploration told Mining News.
Electrum plans to follow-up on Gold Crest’s discoveries. The privately held company told Mining News that it does not want to tip off competition by revealing details of its plans in the region.
Electrum’s Peter Drobeck did say the company sees many opportunities as well as challenges in Alaska and looks forward to doing business here. The JV agreement marks Electrum’s first project in Alaska.
Newmont signs three JV agreements Newmont has agreed to explore gold deposits on more than 22,000 acres of Gold Crest-held properties in Southwest Alaska. Each agreement has similar terms but covers different claim groups.
Two of the claim groups the Denver-based gold giant agreed to explore are Luna and Ako. The two properties cover about 15,200 acres and are near properties that Electrum will be exploring in the Kuskokwim Region. Luna and Ako are located about 120 miles south of the Donlin Creek deposit.
Newmont also agreed to explore Kisa’s Chilly claim group, which covers about 7,040 acres in the Buckstock Mountains some 75 miles northeast of the Ako and Luna claims.
Under JV terms in the phase 1 earn-In, Newmont can earn a 51 percent interest in Kisa’s properties for various considerations by 2011, including $3 million in work expenditures, at least 3,000 meters drilling, $75,000 in cash payments to Gold Crest as well as keeping current with annual rents and assessments to maintain the claims in good standing.
After meeting terms of phase 1, Newmont can increase its interest to 70 percent by completing another $6 million worth of work, including a minimum of 3,000 additional meters of drilling by 2015. If Newmont finances the building of a mine, the company would receive an additional 10 percent ownership stake in the property.
Gold Crest located the Luna prospect during a follow-up of a geophysical anomaly identified from the airborne surveys completed in late 2006 and early 2007, and further defined the anomaly by completing over 16 line-miles of IP-resistivity and 40 line-miles of ground magnetic surveys. Soil samples collected narrowed the primary target area to a 10-square-mile, 16-square-kilometer, gold, arsenic, and antimony anomaly. Rock chip samples collected from the prospect contain anomalous gold, with values as high as 0.75 ounces per ton and is associated with anomalous arsenic, antimony, bismuth, molybdenum, silver, copper, lead and zinc.
Newmont expands its scope In addition to the Gold Crest JV land packages, Newmont has staked two other claim blocks contiguous to the Ako claim group and a large claim block adjacent to the Luna claims based on the results of geophysical and geochemical surveys performed by the gold giant in 2007.
Newmont recently toured the Kuskokwim region to reach out to local residents and inform them of its planned activities in the area. Company representatives distributed flyers saying the miner will use a small geological crew to look at rock outcroppings and take soil and stream sediment samples on its state mining claims and on Native corporation land on which Newmont has acquired exploration agreements.
“We believe this region of Alaska to be prospective for gold deposits, and these agreements allow us to take a look at a portion of what we consider to be the higher priority areas,” Newmont spokesman Omar Jabara told Mining News.
Gold Crest said it is seeking other JV partners to explore the seven additional claim groups it holds in Alaska. Six of the properties are located in the Buckstock Mountain region of Southwest Alaska and the seventh property is the Kelly Creek property on the Seward Peninsula.
Gold Crest spokesman Matt Colbert told Mining News that companies have expressed interest in the remaining properties but they remain open for JV opportunities.
Electrum is considering an option on one of the remaining properties, according to Chris Dail, Gold Crest’s vice president of exploration.
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