As investors clamor for bigger stakes in exploration projects in the White Gold District of Yukon Territory, one astute explorer is shifting part of its focus farther south and eastward.
In early April, Northern Tiger Resources Inc., a spin-out of Firestone Ventures Inc. in 2008, reported optioning the 3Ace Property — located about 270 kilometers, or 167.4 miles, north of Watson Lake in southeast Yukon Territory — from longtime Yukon prospector Alex McMillan. The junior formalized terms outlined in a March 5 letter of intent.
McMillan, who is based in Watson Lake, recently discovered a quartz vein containing abundant quantities of free gold on the 3Ace property, which encompasses 140 claims covering about 2,593 hectares, or 7,000 acres, in a mountainous area some 25 to 30 kilometers by road from Yukon’s border with Northwest Territories.
Northern Tiger said historic work on and near the claims performed toward the end of a five-year exploration program that ended in 2003 identified a number of large gold-in-soil anomalies that warrant further exploration.
The remote Hyland gold discovery, about 80 kilometers, or 50 miles, to the south, is the nearest known gold mineralization, according to Dennis Ouellette, vice president of exploration for Northern Tiger.
In March, Northern Tiger President Greg Hayes said the junior was turning its attention “to planning a program to both evaluate the existing high-grade gold occurrence and also develop a model to explore for similar occurrences on the property.”
Ouellette, a longtime Yukon explorer, told Mining News April 21 that Northern Tiger is mounting a C$300,000 to C$400,000 grassroots exploration program this year. The junior has hired a structural geologist who specializes in orogenic gold deposits because the quartz vein in which remarkable amounts of visible gold was discovered at 3Ace appears to be that type of mineralization. He said the geologist will start at the vein and see if he can find the geological structure of the occurrence.
McMillan also will continue prospecting on the property.
“We are confident we should be able to repeat the occurrence of that vein in this area. We think geology and structure will be the key,” Ouellette said. “Our plan is to develop drill targets for next season. We have the type of property here that we think we can bring forward quickly or determine that it is a unique situation and return it to the prospector.”
Ouellette said finding such significant quantities of free gold in eastern Yukon Territory has been quite exciting because it is “very rare.”
The prospector had quite a number of samples taken from the 3Ace property that show visible gold, he said.
“We can also see gold in the vein itself in the outcrop, and we have had visible gold sighted in other veins on the property,” Ouellette said. “Just having sighted visible gold 300 meters away was very encouraging. It also suggested that the structure allows visible gold to precipitate as opposed to be being bound by sulphides.”
Ouellette said such gold often is less expensive to extract, which bodes well for the property’s potential.
“I’ve certainly never seen anything like it before,” he added.
The option agreement, which is subject to TSX Venture Exchange approval, provides Northern Tiger with the opportunity to earn 100 percent interest in the property. To complete the option, Northern Tiger must make cash payments of C$500,000, issue 2 million shares and incur C$700,000 in exploration expenditures, all over a four-year period.
An annual advance royalty payment of C$45,000 will start on the fifth anniversary of the agreement and continue until the start of commercial production. McMillan will retain a 2 percent net smelter return interest on the property.
If a NI 43-101-compliant resource estimate in excess of 500,000 ounces of gold at a grade greater than 5 grams per metric tons is defined on the property, the vendor’s NSR will increase to 2.5 percent and he will receive a bonus payment of C$300,000 (in cash or equivalent Northern Tiger shares).
If the NI 43-101-compliant resource estimate exceeds 1 million ounces of gold with the same or higher grade, then McMillan’s NSR would jump to 3 percent, and he will receive another C$300,000 bonus payment in cash or Northern Tiger shares. Each 1 percent of the NSR can be purchased by Northern Tiger for C$2 million.
Northern Tiger’s main focus is the Sonora Gulch Project in the Dawson Range where it has found evidence of a strongly altered system hosting multiple styles of mineralization and exceeding 2 kilometers, or 1.24 miles, in length. Two significant zones of gold mineralization have been discovered along this trend – the Nightmusic and Amadeus zones.
The junior also is exploring six copper-gold prospects in an alliance with Minto Explorations Ltd., a subsidiary of Capstone Mining Co., owner of the Minto Mine in central Yukon.