In 2013, the mineral industry globally has been buffeted by financial challenges. Development infrastructure has seen major cost increases. Multinational corporations have had major write-downs of assets associated with falling mineral prices. Junior exploration companies have not been able to raise venture capital for funding projects as investors appear to be shying away from what is seen as a risk investment.
Yukon was not exempt from these challenges. Most exploration programs were downscaled with emphasis on lower-cost prospecting, geological mapping and soil sampling. Drill programs were limited in scope and designed to increase or upgrade known resources. The number of new hard rock mineral claims staked has dropped dramatically. Peripheral hard rock claims staked during the exploration rush of 2011-2012 are being allowed to lapse. Of the three producing mines in 2013, only Minto continues to operate at full production; Wolverine is only working one shift, and Bellekeno will temporarily stop mining from the fall of 2013 until early 2014.
Despite the challenges presented by the global market situation, mining and exploration work continues in Yukon, with several bright spots noted below. As well, the Yukon government remains committed to providing an internationally competitive investment climate, which includes a focus on regulatory certainty and strong support for industry from the Yukon Geological Survey. As well, in light of increased challenges for industry in obtaining capital funding, the Yukon government increased its funding of the Yukon Mining Incentives Program in 2013.
ExplorationDespite the global downturn in the industry, exploration is still occurring in Yukon. Companies are evaluating and consolidating their exploration properties that were staked during the most recent exploration boom; as of May 2013 the number of claims in good standing was approximately 10,000 fewer than the high of 2012, a decrease of 4 percent. The primary commodity of interest for exploration remains gold. Many companies used a combination of diamond drilling and reverse circulation drilling to evaluate advanced targets while continuing with soil sampling, trenching, prospecting, and geologic mapping in less advanced areas of their properties.
There were several bright spots on Yukonís exploration landscape. The White Gold area south of Dawson City, the southwest Yukon area, and the Selwyn basin area north of Mayo saw continued fieldwork on expanded exploration holdings. Kaminak Gold Corp. released an inferred resource estimate of 3.2 million ounces of gold in December 2012. In 2013 they conducted an extensive drill program to infill and expand their oxide resource around conceptual open pit margins. Comstock Metals Inc. is evaluating extensions of previously discovered mineralization on their QV property. Klondike Gold Corp is also evaluating previously defined targets on its Lone Star property.
Atac Resources is extending its exploration success on the Nadaleen gold trend along the northern margin of Selwyn basin. Excellent drill intersections confirm the presence of the Carlin-style gold mineralization occurring along the Nadaleen trend. Strategic Metals Ltd., Gold Fields Selwyn Exploration Corp., and Anthill Resources are also evaluating targets along trend with Atacís ground.
In southeastern Yukon, Northern Tiger Resources completed a bulk sampling program on its 3Ace property.
Although gold is in the limelight, 2013 also saw exploration dollars spent for other commodities. Prophecy Platinum is re-logging and sampling 12,000 meters of historic core to upgrade its resource for disseminated mineralization on the Wellgreen property. Silver Range Resources continues prospecting, soil sampling, geology mapping and drilling north of Faro on a series of lead, zinc and silver occurrences.
Mining and developmentYukon had three operating mines in 2013: Capstone Resources Minto copper-gold mine, Alexco Resourcesí Bellekeno silver mine, and Yukon Zincís polymetallic Wolverine mine. The Minto mine has been in continuous production since 2007. Minto is mining from the area 2 open pit and developing access for underground mining in late 2013 or early 2014. Exploration drilling is ongoing to replace mined reserves.
Alexco Resource Corp. has successfully received permits for production from two additional locations in the Keno District. In response to low silver prices the company announced that production and development in the Keno area will be put on hold temporarily during the winter of 2013/14. Alexco continues to run an exploration program to expand the Flame and Moth property. Yukon Zincís Wolverine mine has also reduced production in light of current metal prices.
Victoria Gold has applied for all necessary permits for mining the Eagle deposit. In light of the present poor equity market conditions, however, they have decided to delay infrastructure development for the future mine. Eagle Industrial Minerals Corp. also received all permits required for mining the Whitehorse Copper tailings for their magnetite content and reclaiming the site. Americas Bullion Royalty Corporation is applying to Yukon Environmental and Socioeconomic Assessment Board for mining of the gold mineralization at its Brewery Creek property.
Yukon GovernmentThe Government of Yukon is committed to providing an internationally competitive investment climate. To this end, the government strives to provide regulatory certainty around environmental assessment, permitting and licensing of projects.
Supporting the exploration and mining industry continues to be a priority for the Yukon Geological Survey. This year, the Yukon Geological Survey has initiated or continued geological studies (such as bedrock mapping) in the Rackla area, southwest Yukon, and central Yukon north of Faro.
The Government of Yukon and Government of Canada have signed modern land claim agreements with 11 of the 14 Yukon First Nations. These agreements contribute to clarity for industry in regard to engagement and potential for First Nation partnerships and opportunities.
Recognizing the difficulties in finding capital in todayís global markets, the Government of Yukon has increased their investment funding in the Yukon Mining Incentive Program to C$1.17 million in 2013 from 2012ís C$570,000. YMIP provides a portion of the risk capital required to locate, explore, and develop mineral projects. The program contains three modules: grassroots-prospecting, focused-regional, and target evaluation. This year, 56 projects are being partially funded through YMIP.
For more information on Yukonís mineral resources, visit: Miningyukon.com.
Lee Pigage is head of Mineral Services at the Yukon Geological Survey, Department of Energy Mines and Resources, Government of Yukon.