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Vol. 15, No. 26 Week of June 27, 2010
Providing coverage of Alaska and Northwest Canada's mineral industry

Mining News: Summertime, and the miners are busy

Explorers, old and new, scour length, breadth of Alaska for gold, silver, copper, nickel, lead, zinc, platinum, and palladium

Curt Freeman

For Mining News

As the long-awaited summer solstice comes and goes, Alaska’s mining industry is deep in the midst of its summer exploration, development and production programs. Mineral exploration programs are under way from far Southeast Alaska to the Brooks Range, from eastern Interior Alaska to the Seward Peninsula. The commodities being explored for, developed and mined are equally diverse and include gold, silver, copper, nickel, lead, zinc, platinum and palladium. Two new exploration companies have entered the hunt in Alaska in the last month and the sound to boots thumping tires can be heard all across Alaska as new acquisitions are being reviewed and new business arrangements completed.

Western Alaska

TintinaGold Resources Inc. said it has commenced drilling on its Kugruk copper-iron project on the Seward Peninsula. The company plans a 4,000-meter drilling program this year focused on testing several multi-kilometric scale copper-iron mineralized zones on the project. The property contains highly magnetic zones along an intrusive-metasediment contact extending for a length of at least 15 kilometers. One of the targets, the Billiken prospect, is a 3-kilometer-, or 1.86-mile-, long highly magnetic zone which also shows high gravity, low resistivity and high induced polarization geophysical responses where a number of shallow drill holes were completed during the mid-1970s. Other large zones with low resistivity and high induced polarization geophysical responses are present at the South Kugruk and Knowles Creek targets. Local copper-in-soil anomalies over the intrusive centers, a copper-iron enriched skarn contact zone between the intrusive and metasediments and a halo of silver-lead-zinc and gold placer prospects suggest the presence of a large scale, zoned intrusive-driven mineral system.

Fire River Gold Corp. announced additional results from previously unreleased drilling at its Nixon Fork gold project near McGrath. Significant results include 15.52 ounces of gold per ton over 9.8 feet in hole N07U061; 0.68 ozs/t gold over 40.3 feet in hole N07U046; 0.55 ozs/t gold over 16.4 feet in hole N07U021; 2.21 ozs/t gold over 22 feet in hole N07U049; 0.79 ozs/t gold over 78.7 feet in hole N07U053; 0.92 ozs/t gold over 37.1 feet in hole N07U055; 2.95 ozs/t gold over 14.8 feet in hole N07U056; and 1.95 ozs/t gold over 20.7 feet in hole N07U059. The company provided an update regarding the progress of work on the Preliminary Economic Assessment for the tailings reprocessing option at the project. Three alternatives are being evaluated: 1) use an existing thickener after the CIL process to recycle cyanide solution and thereby decreasing the cyanide destruct circuit operating cost; 2) installation of a new filter to further increase cyanide recycle and reduce cyanide destruction requirements and associated costs; and 3) assess the benefits of installing a Merrill Crowe system for gold recovery with shipment of gold bars rather than loaded carbon off site. Work is expected to be completed in the fall. The company also announced that a 12,000-meter diamond drill program is slated to begin in late June. Drilling will initially focus on surface targets, particularly lateral or down plunge extensions of known mineralized zones. These targets include the Whalen, North Star, Mystery, Southern Cross, and J5A zones. Following the surface drilling program, underground drilling will begin within the Crystal decline.

Interior Alaska

Teryl Resources Corp. and joint-venture partner Kinross Gold Corp. is conducting a 16,000-foot drilling program at their Gil gold project near Fairbanks. The 2010 drilling program is planned for 11,000 feet of reverse circulation drilling and 5,000 feet of core drilling. Drilling in 2010 will further delineate the strike extension of gold-bearing zones in the Main Gil, North Gil and Sourdough Ridge deposits. In addition to drilling, fieldwork involving mapping, soil and rock sampling, and mobile metal ion geochemical sampling will be performed.

International Tower Hill Mines Ltd. announced a resource update on its Livengood gold project. The new resource incorporates 420 diamond and reverse circulation holes totaling 121,212 meters. At the 0.3 grams per metric ton cutoff, indicated resources now stand at 15.7 million ounces of gold in 788.9 million metric tons grading 0.62 g/t gold, while inferred resources now total 4M ounces gold in 229.1Mt grading 0.55 g/t gold. All-in that’s 19.7M ounces of gold, a 1.2M ounce increase over previous resource estimates. The company also announced final drill hole results from its winter 2010 drill program. Results include hole MK-RC-0351, which returned 54.86 meters at 0.91 g/t gold; and hole MK-10-51, which returned 6.59 meters at 1.02 g/t gold. Tower Hill reported additional results of column leaching and flotation tests. Flotation tests indicate that an average 89 percent of the gold reported to the float concentrate, while column leach tests confirmed earlier results and indicate that average cyanide leaching recovery ranges from 34 percent to 63 percent and averages 57 percent. Combined carbon-in-leach plus gravity recoveries stand at 75 percent, while combined gravity plus flotation and leach recoveries stand at 74 percent

Alaska newcomer Precious Metals Exploration Corp. has acquired an option to explore Alix Resources’ Money Rock project in the Goodpaster District. Under the option agreement, Precious Metals Exploration can acquire 60 percent of the company’s interest in the property by paying Alix $50,000 upon signing, plus $100,000 after a 60-day due diligence period and incurring $500,000 in work expenditures over a three-year period. Additionally, Alix will receive four installments of 250,000 shares of the public vehicle that Precious Metals Exploration intends to form to conclude the transaction. A soil and stream sediment sampling is scheduled to begin early in the third quarter of 2010. Welcome to Alaska Precious Metals Exploration Corporation!

Full Metal Minerals Ltd. reported that drilling has commenced at its Fortymile polymetallic project near Chicken. The company intends to complete 5,000 meters of drilling using two core rigs targeting high-grade carbonate replacement-style sulfide deposits. The company will perform step-out drilling at the high-grade LWM deposit, as well as scout drilling on new silver-enriched prospects on the property, including the Falcon prospect where a new silver-rich structure was discovered during 2009. Mineralization has been traced along the Falcon structure for 800 meters and select grab samples from Falcon returned 2,370, 1,355, 918, 583 and 264 grams of silver per metric ton, respectively.

Alaska Range

Kiska Metals Corp. said a 5,000-meter drilling program has begun at its Whistler copper-gold project. Three holes will test targets at Island Mountain. One hole, a 50-meter offset of the discovery hole, will test this zone with a deeper hole in order to get an intersection through the full width of the mineralization. A second hole will be collared 800 meters to the southeast of the 2009 discovery and will test a similarly mineralized stockwork zone, which may represent the southern strike extent of the same mineralized system. A third hole will further test the Cirque Zone, 1.7 kilometers to the north of the discovery hole. Drilling in 2009 at the Cirque Zone targeted a broad zone disseminated chalcopyrite mineralization in association with a biotite-altered monzonite porphyry. In addition two holes will test targets at the Round Mountain area, 10 kilometers north of the Whistler resource area.

Kiska Metals Corp. also announced that it had acquired a 100 percent interest in the Copper Joe copper-gold-molybdenum porphyry prospect located 50 kilometers southwest of the company's Whistler project. Kiska can earn a 100 percent interest in the property from Kennecott Exploration Co. by incurring a total of $5.0 million in exploration expenditures by December 31, 2015 including a commitment to $170,000 in exploration by December 31, 2011. Kiska also will pay Kennecott a one-time cash payment of $10 million upon completion of a positive 43-101 compliant pre-feasibility study. Kennecott staked mining claims in 2006 after reconnaissance work at the headwaters of the Styx River located distal porphyry-style alteration in monzodiorite porphyries. A followup traverse discovered angular boulders containing copper mineralization that were traced to a small creek bed exposure. The mineralized showing exhibits potassic alteration with quartz-magnetite stockwork veins which contain disseminated chalcopyrite. Potassic alteration occurs over a 3-kilometer-by-1- kilometer, or 1.86-mile-by-0.62-mile, area with moderate to intense phyllic alteration extending a further 2.5 kilometers, or about 1.5 miles, outward. Most of the target area is covered by a thin veneer of glacial till. Kennecott completed 70.4 line-kilometers of ground magnetics, which highlighted an open-ended magnetic high feature measuring 1 kilometer by 1.9 kilometers, or 0.62 miles by 1.1 miles, trending northeast from the mineralized showing. Kennecott collected 28 rock samples yielding peak values of 0.73 percent copper, 0.415 g/t gold, 7.9 g/t silver and 0.125 percent molybdenum. The prospect has never been drilled.

Pure Nickel Inc. said drilling is underway on its MAN nickel-copper-platinum group element project in the Alaska Range. The company and its partner, ITOCHU Corp., will spend $7.5 million on the project in 2010. An 8,000-meter drill program will employ two fly drills; the first drill has already begun work on the Beta complex and the second was to begin on the Alpha complex in mid-June.

Northern Alaska

Goldrich Mining Co. announced that preparations for commercial gold production, as well as a 20,000-foot core drilling program are under way at its Chandalar property in the Brooks Range. The placer gold mining operation is fully permitted and commercial gold production was expected to start the third week in June. Currently, mine infrastructure on the property is being upgraded, some new camp facilities are being put in place, and gold recovery plant modifications are being made. Production will begin with the gold recovery plant that was constructed and tested last year. A second, larger gold recovery plant is expected to be operational sometime in August. Goldrich expects to produce 5,000-7,000 ounces of gold this year, with the first dore to be poured in early July. As the project matures over the next couple of summers, the production level is anticipated to reach 30,000 ounces of gold per year. The exploration drilling program will evaluate a stratabound lode gold target estimated to be 5 miles long near the center of the company’s property.

Southeast Alaska

Constantine Metal Resources Ltd. reported the start of its 2010 exploration program at its Palmer copper-zinc-gold-silver rich volcanogenic massive sulfide project near Haines. The 2010 exploration program will use two drill rigs and calls for 7,500 meters of drilling in about 20 holes. Drilling during this phase is focused on expanding the deposit, which consists of several zones that are open to expansion. In addition to drilling, the 2010 program will include both surface and down-hole electromagnetic geophysical surveys. Surface-based electromagnetic surveys work will total approximately 40 line-kilometers and cover areas immediately along trend from the currently defined deposit and several other well mineralized prospects known to occur on the property.

Copper Ridge Explorations Inc. announced that a 1,500-meter drill program has commenced at its Duke Island copper-nickel-platinum-palladium property near Ketchikan. The planned drill holes will target high-grade massive to semimassive sulfide mineralization within the Marquis Zone of this ultramafic intrusive complex. The drill targets have been defined by interpretations based on geological mapping, historical drill results and three-dimensional modeling of a variety of geophysical surveys including magnetics, electromagnetics, induced polarization, magnetotellurics and gravity. Nine of 11 core holes drilled at the South Rim of the Marquis prospect intercepted from 6-90 meters of semimassive to massive sulfide containing highly anomalous values for copper (10 to 12,500 parts per million), nickel (27 to 4,694 ppm), platinum (less than 5 to 680 parts per billion), and palladium (less than 5 to 548 ppb) and established a north dip to the upper contact of sulfide mineralization. Modeling of electromagnetic and natural source audio-frequency magnetotellurics survey results defines an eastern plunge and a wine-glass shaped conduit below the covered conductive anomaly at the Marquis prospect, reminiscent of other high grade magmatic sulfide deposits. The current drill program will focus on the area of joint-venture partner Quaterra Resources Inc.’s best drill results, near the strongest geophysical targets but will extend the tests to greater depth.

Quaterra Resources Inc. said it signed an option agreement with Alaska newcomer Grande Portage Resources Ltd. whereby Grande Portage may earn up to a 65 percent interest in the Herbert Glacier gold project located 20 miles north of Juneau by spending $1.25 million in two stages. Grand Portage may earn a 51 percent interest in the property by spending $750,000 on or before June 15, 2011, and has the option to earn an additional 14 percent interest by spending $500,000 on or before June 15, 2012. The Herbert Glacier property lies within the 100-mile-long Juneau gold belt. Much of the area now known to be mineralized on the project was only recently exposed as glacial ice receded. The property hosts six main composite vein-fault structures that contain ribbon quartz-sulfide veins. The structures strike east-west and dip steeply, mostly to the north. Only one of the six known vein systems was drilled in 1986 and 1988. Sampling in 2007 by Quaterra showed that all six structures locally have high-grade gold-quartz mineralization. Grande Portage will begin work this summer with a 4,000-foot core drilling program planned. Welcome to Alaska Grande Portage Resources Ltd.!

Niblack Mineral Development Inc. and joint venture partner Heatherdale Resources Ltd. announced that Heatherdale has met its initial $5 million project investment commitment before the first anniversary date of the agreement with Niblack and will continue to fund exploration activities to rapidly advance the Niblack massive sulfide deposit on Prince of Wales Island. Currently two underground diamond drill rigs are working to delineate the copper-gold-silver-zinc mineral body at the Lookout Zone, one of six known volcanogenic massive sulfide deposits within the project.

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