Eager to discover whether Rio Tinto Ltd. subsidiary Kennecott Exploration Inc. will exercise its right to buy back a 60 percent stake in the Whistler gold-copper project, Kiska Metals Corp. has launched a 15-hole drill campaign and corresponding 3-D-induced polarization survey to explore the larger potential of the 173-square-mile, or 448-square-kilometer, central Alaska property.
The largest portion of the drill program, which began in mid-March, is testing targets within the Whistler corridor, a 162-square-kilometer, or 62.5-square-mile, region that hosts the Whistler deposit. Whistler is believed to contain an indicated resource of 30 million metric tons grading 0.87 grams per metric ton gold, 2.46 g/t silver and 0.24 percent copper, and an inferred resource of 134 million tons grading 0.64 g/t gold, 2.18 g/t silver and 0.20 percent copper.
A technical committee comprised of management from both Kiska Metals and Kennecott selected the Whistler corridor targets based on data collected from an extensive geophysical survey conducted in late 2009.
The 3-D IP survey revealed several targets hidden beneath the shallow alluvial sediments covering much of the Whistler corridor. These discoveries do not have the significant outcrop of the Whistler deposit, but have comparable geophysical, geological or geochemical signatures.
“We knew going in, because there is a lot of covered area in that valley right near the Whistler deposit, the geophysical program was going to be important,” Kiska President and CEO Jason Weber told Mining News.
IP reveals discreet targetsIn late 2009, crews blanked the Whistler corridor, including the Whistler deposit, with a 3-D IP survey. This geophysical work has provided Kiska geologists with a clearer picture of what lies hidden under the glacial gravels that cover most of this region.
“Because this survey covered such a big area – we actually covered the Whistler deposit as well – we could take geophysical signature from Whistler and just apply that elsewhere in our survey area to pick our targets,” Weber explained.
Using the IP signature associated with the Whistler resource as a guide, Kiska has defined more than 25 distinct new targets with a similar geophysical signature. Ten of these targets, all of comparable scale and geophysical response to that associated with the Whistler deposit are being tested in the current drill program.
"We are extremely encouraged with the outcome of the 3-D IP survey. With this data we believe we now see why some previous holes in the corridor encountered mineralization and why others missed,” Weber said. “We’re especially impressed by anomalies such as the Whistler North Lobe, which, if successful, could add significantly to the existing Whistler resource and the Raintree area, which looks to be part of a greater cluster of porphyry centers. Integration of this new survey with historic data has given us a much clearer picture of the subsurface providing us with discreet targets to test under the glacial cover.”
Last fall, Kiska crews completed about 80 percent of the 340-line-kilometer 3-D IP survey slated for the Whistler corridor. The company plans to resume the geophysical work in May.
Whistler deposit expansionKennecott and Kiska geologists are intrigued by areas to the north and southwest of the Whistler deposit that carry a similar geophysical signature as the defined resource. The Whistler committee assigned two holes to target these possible extensions of the deposit.
The area to the northwest, dubbed the Whistler North Lobe, is a large untested anomaly that appears to be the fault offset extension to the north of the Whistler deposit.
“The chargeability is fairly significant in size, so if we are fortunate enough to hit there, potentially we could be looking at adding a significant number of ounces to the resource at Whistler,” Weber told Mining News.
Whistler Southwest Lobe appears to be a continuation of the Whistler resource to the west of deposit. This apparent expansion area revealed by the recent IP survey also will be a drill target of the spring program.
Targeting RaintreeThe Raintree area, located in the valley east of the outcropping Whistler deposit, is the target of three of three of the holes drilled this year.
Raintree North was the first target of Kiska’s 2010 drill campaign. Located about 1,800 meters northwest of the Whistler deposit, this hole is targeting the northern extent of a large geophysical anomaly in the Raintree area.
Kiska is particularly excited about drilling the Raintree West prospect. This hole is a follow-up to the explorer’s 2009 Raintree discovery hole, which cut 471.6 meters with an average grade of 0.93 g/t gold equivalent. The bottom 40 meters of this hole, which was angled toward the west, intersected higher temperature veining, suggesting a trend toward the core of a large porphyry system and an improved likelihood of higher copper-gold grades. The 3-D IP survey revealed that the signature of these elevated grades continues 300 meters further west, and this coincidental geophysical anomaly is the target of the current program.
“We are setting up further to the west and going to drill back to the east to test that (geophysical anomaly), that’s a really exciting target,” said the Kiska president.
The third hole being drilled into the large Raintree prospect is located about 1,800 meters northeast of the Raintree West hole.
In addition to drilling 11 holes in the Whistler corridor, the technical team elected to drill two holes at the enigmatic Island Mountain prospect to follow up on exciting gold-copper mineralization.
IM-09-001, the Island Mountain discovery hole drilled late in 2009, cut two distinct mineralized zones. The upper 150 meters – which averaged 1.06 g/t gold equivalent (0.72 g/t gold, 2.37 g/t silver and 0.16 percent copper) – is similar to the mineralization found at the Whistler deposit about 23 kilometers, or 14 miles, north. The mineralization in the lower 106.9 meters of the hole – which averaged 1.32 g/t gold-equivalent (1.22 g/t gold 0.69 g/t silver and .05 percent copper) – more closely resembles the gold-dominant mineralization being investigated about 2 kilometers, or 1.2 miles, southeast at the Shoeshine Zone on Millrock Resources Inc.’s Estelle property.
Weber told Mining News that the Kiska-Kennecott technical committee has not yet decided whether to follow up on the mineralization discovered last year, or to drill new targets at Island Mountain.
The final two holes of the 15-hole program are being reserved for Round Mountain, pending additional geophysical data from this prospect.
Kennecott decisionOnce the current IP and drill program is complete, Kennecott will have 90 days to decide whether it wants to exercise its back-in rights on the project. If the Rio Tinto subsidiary decides it would like to gain a 51 percent interest in the project it will pay Kiska an estimated C$25 million (double what it and its predecessor Geoinformatics spent on exploration at Whistler) and fund Whistler exploration through a positive prefeasibility study.
Kennecott can up its stake to 60 percent by funding the project through to a positive development decision.
Weber said Whistler also is attracting the attention of other majors.
“Kennecott has been a great partner, and they have gone above and beyond what they needed to do to help us be successful; as long as they have the back-in right, I am not entertaining the other companies,” he said.
Kennecott, which optioned Whistler to Kiska (Geoinformatics) in 2007, will retain a 2 percent royalty if it chooses not to exercise its back-in right for the gold-copper project.