Higher grade found at Gil

Results announced from extensive summer drilling at gold exploration prospect near Fort Knox in Interior Alaska

Patricia Jones

Petroleum News Contributing Writer

A 60-hole drilling program conducted at the Gil property, an advanced-stage exploration project neighboring the mammoth-sized Fort Knox mine and mill in Interior Alaska, has produced some higher grade intercepts near surface.

Kinross Gold, owner and operator of the Fort Knox facility some six miles west of Gil, holds an 80 percent interest in that exploration property. The remaining 20 percent is held by Vancouver, British Columbia-based Teryl Resources Corp.

Teryl’s President John Robertson said in a Sept. 2 statement that recent work at Gil is producing “excellent results.”

Among the 35 drill hole intercepts charted by the company, Robertson highlighted an intercept that assayed 0.116 ounces of gold per ton of rock, taken from a 60-foot interval in the Main zone, one of four gold targets on the property.

The higher-grade occurrence came from the five- to 65-foot section of the drill hole, an indication of near-surface mineralization.

In past interviews, Kinross and Teryl representatives described Gil’s mineralization as shallow, saying most drill holes are 300 feet in depth or less. With less waste rock to strip away to get to mineralized ore, mining becomes more economically viable.

Gil is being advanced by Kinross and Teryl as potential feedstock for the Fort Knox mill, which churns through some 17.7 million tons of ore each year, producing a little less than 410,000 ounces of gold annually. Recent estimates of the remaining Fort Knox deposit show the mine’s life possibly concluding in 2010.

This summer’s first phase of exploration consisted of drilling some 60 holes for a total of 17,000 feet, with a planned budget of $830,000. Kinross is operating the work, and told Petroleum News this spring that the company would like to bring the property to a feasibility and permitting stage in 2004.

“Kinross’ intentions for Gil are to advance the project to a production decision,” Robertson said in the Sept. 2 statement. While the property contains two other interesting gold targets, Sourdough Ridge and Skarn Grid, exploration crews focused attention this summer on work to “define the limits of gold mineraliation at the North Gil and Main Gil Zones,” Robertson said. “Continued success in the first phase would initiate follow-up in-fill drilling at the Main Gil zone to upgrade the resource to reserve status.”

The company did not say if or when the second phase of exploration drilling would begin. Previously, the companies said the program could involve drilling up to 74 holes for a total of 22,000 feet, at an estimated cost of $590,000.

Past reports indicate the Main Gil zone is believed to be 3,000 feet in strike length and 70 feet thick, Robertson said. Mineralization at North Gil covers a zone 1,000 feet long by 500 feet wide.