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Vol. 12, No. 30 Week of July 29, 2007
Providing coverage of Alaska and Northwest Canada's mineral industry

MINING NEWS: High summer busy time for deals, as well as exploration, development activity

Curt Freeman

For Mining News

The author Curt Freeman, CPG #6901, is a well-known geologist who lives in Fairbanks. He prepared this column July 23. Freeman can be reached by mail at P.O. Box 80268, Fairbanks, AK 99708. His work phone number at Avalon Development is (907) 457-5159 and his fax is (907) 455-8069. His email is avalon@alaska.net and his web site is www.avalonalaska.com.

It is high summer in Alaska and the wheeling and dealing are nearly as frenetic as the exploration, development and production going on all around the state. New deals continue to be cut on old and new projects while more established projects are being subjected to the “truth machine,” otherwise known as the drill. This time-tested application has proven many a cock-sure geologist or engineer dead wrong but that doesn’t stop anyone in the industry from picking himself up, dusting his backside and moving on to the next target a bit older and wiser but no less enthusiastic or optimistic.

Western Alaska

Geoinformatics Exploration has acquired the Whistler copper-gold porphyry project from Kennecott Exploration. Terms of the deal require Geoinformatics to expend at least $2.5 million in exploration work in both 2007 and 2008 to earn 100 percent interest in the project, subject to previously agreed terms of an Alliance Agreement between the two parties. Total approved 2007 exploration is expected to be approximately $3.2 million.

The Whistler project is located in the western Alaska Range and includes a partially defined gold-copper porphyry system which comes to surface with a mineralized envelope confirmed over an area of 760 by 230 meters and to a depth of 570 meters and which is open to the north and at depth. Significant intervals from past drilling include 290.3 meters of 1.15 grams of gold per tonne and 0.23 percent copper in hole 04-DD-WH-01; 219.4 meters of 1.49 grams of gold per tonne and 0.33 percent copper in hole 04-DD-WH-05; and 91.9 meters of 1.13 grams of gold per tonne and 0.23 percent copper in hole 05-DD-WH-12.

Drilling in 2007 is expected to include the drilling of the Muddy Creek Prospect, an irregular L-shaped area approximately 3.2 kilometers by 2.5 kilometers within which 150 rock-chip samples returned gold grades as high as 111 grams of gold per tonne with an average grade of 4.72 grams of gold per tonne.

International Tower Hill Mines has signed an agreement with Hidefield Gold Plc. and its partner Mines Trust Ltd. pursuant to which Tower Hill can earn up to an 80 percent interest in the South Estelle gold project in southwest Alaska. Under terms of the deal Tower Hill can earn an initial 51 percent interest by making payments of $92,000 before Jan. 8, 2008, and incurring exploration expenditures of $2 million prior to Dec. 31, 2009.

Tower Hill can earn an additional 19 percent interest by incurring an additional $3 million in exploration expenditures before Dec. 31, 2011, and can earn an additional 10 percent interest (aggregate of 80 percent) by funding all expenditures required to prepare and deliver a positive bankable feasibility study.

High-grade gold veins on the South Estelle project are hosted by alkaline intrusives that are similar in age to those hosting mineralization at Geoinformatics/Kennecott Exploration Co.’s Whistler copper-gold project 15 kilometers to the northeast. Previous work by Hidefield has identified a number of high-grade gold vein systems with 10 percent of the rock samples collected to date exceeding 10 grams of gold per tonne with values ranging from less than 0.005 to 113 grams of gold per tonne.

Eastern Interior

Kinross Gold has received its operating permits for a heap leach expansion facility at the Fort Knox mine. The valley leach facility will be located in Walter Creek immediately above the existing mill tailing facility and will allow the company to recover gold from material that is below cut-off grade for processing in its existing mill. Construction of the valley leach facility is expected later this year after Kinross acquires a reclamation bond of $34,314,418.

Freegold Ventures Ltd. has acquired all of the permits required at its Golden Summit project to begin gravity recovery processing of a 10,000 ton bulk sample stockpiled in 2006. In addition, other permits were acquired that will allow annual extraction and testing of up to 50,000 cubic yards of additional material per year through May 2012. The permits cover the previously bulk sampled Cleary Hill mine area as well as the Tolovana mine, Newsboy mine and Newsboy extension areas of the project.

Rubicon Minerals Corp. announced initial results from its wholly owned New Horizon gold project in the Goodpaster district. Surface follow-up work is being conducted prior to diamond drilling in the newly discovered Bullion 1 target area where preliminary sampling in 2006 identified a 10 by 7 kilometer area containing greater than 100 parts-per-million arsenic in stream silt and pan concentrate samples. Quartz veins interpreted as bedrock or sub-crop from this area returned gold values from trace up to 12 grams of gold per tonne.

Prospecting to date has identified a one square-mile area known as the Maple Leaf prospect where grab rock samples range from trace gold to 19 grams of gold per tonne with 17 percent of samples (total 114 rock samples to date) containing gold in excess of 1.0 gram of gold per tonne with an average of 5.2 grams of gold per tonne. Gold is associated with elevated bismuth (up to 7,700 parts per million), tellurium (up to 280 parts per million) and variable arsenic.

Mineralization is characterized by sugary textured quartz veins and locally vein stockworks of variable orientations associated with intrusive and country rock (gneisses) containing trace to 2 percent sulfides characterized by arsenopyrite +/- bismuthinite +/- molybdenite and, locally, visible gold.

Outcrop in the area is limited but, to date, veins range from less than 1.0 meter wide to vein stockworks over 1-3 meters. Extensive areas are covered and a soil sampling program is under way to determine if these areas have potential to host mineralization. Large (0.5 meter by 0.25 meter) boulders containing bismuthinite-bearing veins noted from the target area have not yet been traced to their source.

Additional prospecting outside of the Maple Leaf showing area has identified additional mineralization which is currently being prospected and sampled. Approximately $2 million in expenditures are planned for the project in 2007.

Full Metal Minerals announced initial results from drilling on the LWM polymetallic prospect at its Fortymile project under option from Doyon Limited.

Significant drilling results include hole LWM07-4 which returned 12.27 meters grading 68.8 grams of silver per tonne, 8.1 percent zinc and 3.7 percent lead and 44.57 meters grading 76.6 grams of silver per tonne, 15.9 percent zinc and 4.5 percent lead; hole LWM07-5 which returned 8.5 meters grading 105.3 grams of silver per tonne, 12.3 percent zinc and 7.7 percent lead and hole LWM07-7 which returned 15.6 meters grading 127 grams of silver per tonne, 21.2 percent zinc and 8.1 percent lead. Massive sulfide mineralization occurs as massive, to brecciated coarse grained sphalerite and galena with local chalcopyrite, hosted within carbonates units and a fine-grained dolomite altered intrusive unit.

Alaska Range

International Tower Hill Mines has completed airborne magnetic and electromagnetic surveys over its Chisna copper-gold property in the central Alaska Range. The survey data has produced results consistent with the presence of a large porphyry system in the central part of the claim block where previous work had identified a strong copper-gold-silver anomaly. The data has revealed a strong circular magnetic anomaly at the 5950 target. This feature coincides with a number of rock chip samples which assayed greater than 0.25 percent copper.

The survey also helped delineate the Miller Gulch intrusive complex which lies immediately to the north of 5950 target. Mafic and ultramafic apophyses of this complex crop out in the area and historical studies suggest that this complex is the source of platinum mineralization found in the gold placers which drain the target area. Tower Hill stream silt data from the Miller Gulch target area also are highly anomalous in nickel indicating potential for a sulfide nickel deposit.

Southeast Alaska

Coeur d’Alene Mines has completed construction work on the main access tunnel at the Kensington mine project north of Juneau. All remaining, non-tailings related surface facility construction is scheduled for completion by mid-August.

The completion of the 12,000-foot horizontal tunnel now allows for clear access between the Kensington mine and the adjacent Jualin property where the mill and processing facilities are located. In addition to connecting with the two properties, the 18-foot wide by 15-foot high tunnel opens up new ground in the historic Jualin and Comet mining areas for future exploration.

Full Metal Minerals has resumed drilling on its Mount Andrew iron oxide copper-gold project on Prince of Wales Island. A planned 3,000 meter drilling program will test multiple targets at Mount Andrew by stepping-out from copper mineralization encountered during the 2006 drilling program.

Copper mineralization occurs within semi-massive to massive magnetite bodies within andesitic volcanic rocks, and intermediate intrusive rocks, later cross-cut by post-mineralization dykes. Andestic rocks commonly exhibit tactite-style alteration, coupled with strong sodic and potassic alteration.

Other

Pacific North West Capital has entered into a joint venture agreement with Stillwater Mining Co. to explore and acquire additional platinum group metals projects in Alaska. Under the terms of the agreement, Stillwater will expend $500,000 in 2007 to fund an Alaska reconnaissance program in order to identify potential platinum group metal projects for further exploration.

Stillwater may elect to further participate in any of the projects identified by the 2007 reconnaissance program by providing sole funding for each continued exploration project.

Upon Stillwater expending $4 million on any individual exploration project, the project will advance under a 50-50 joint venture with Stillwater having the further option to increase its interest to 65 percent by incurring an additional $8 million of exploration and feasibility study expenditures and arranging production financing.



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