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New life for Little Squaw Gold Mining Company Geologist and businessman breathes new life into Alaska land firm’s Chandalar project Patricia Jones Petroleum News Contributing Writer
It took three years of negotiations, but geologist and businessman Richard Walters put together a deal to purchase interests of the Little Squaw Gold Mining Co., with the intention of putting the company’s high-grade gold property back into business.
Incorporated in 1959, Little Squaw’s holdings include 1,500 acres of mining claims, including 426 acres of patented land, and a 100-ton per day mill and gold recovery plant in the northern Alaska, Chandalar Lake area.
The corporation has been inactive for the last 25 years, Walters said, and the former company president, Eskil Anderson, is 90.
“Little Squaw has always been passive, leasing to other people and companies to do mining, which were undercapitalized and did not make a go of it,” Walters told Petroleum News in early September, following his recent trip to the remote Brooks Range property, located about 180 miles north of Fairbanks, Alaska. “We’re going to take a different tact — Little Squaw is going to do the work or bring in mining partners under terms of agreement.”
Walters and his partners put together two limited liability companies, secured some investment financing, and finalized a debt and stock purchase agreement announced in July with Little Squaw’s officers and directors.
Walters now is working to stabilize the company, secure additional financing and put together a substantial exploration and development program for the Chandalar project.
“It’s a good gold property,” Walters said. “Attractive to me are the very large gold veins, although they are difficult to explore.” High-grade mineralization Potential exploration prospects are numerous on the property, where gold was first discovered on Little Squaw Creek in 1905. Past production in the district exceeded 84,000 ounces, Walters said, and some of the underground ore is rich enough to be considered bonanza grade.
In a late July press release, Walters announced mining results taken from the lodes during their last workings, from 1979 to 1983. Then, a lessee recovered 8,169 ounces of gold, with an average grade of 0.97 ounces per ton of rock.
Remaining material at the property’s four mine sites includes more than 17,000 tons of mineralization, grading about 1.5 ounces of gold per ton of rock, according to the press release.
The gold-bearing quartz veins are deep-seated mesothermal in development, Walters said, which typically contain great vertical extension. Yet only a fraction of the mineralized area has been drilled by prospectors, he said, and no holes are deeper than 200 feet below the mine workings.
“It’s difficult to drill in the shear zones, because of permafrost,” he said.
Drill and trenching results taken by prior prospectors, compiled in a report dated 1990, show high-grade intercepts at four of the property’s mines.
A bulldozer trench at the Mikado Mine found quartz veins of eight inches grading 15.50 ounces of gold per ton of rock, 12 inches grading 10.13 ounces and 12 inches at 7.07 ounces. Drilling encountered a five-foot intercept, grading 0.32 ounces of gold per ton of rock, and a deeper five-foot intercept grading 0.58 ounces.
Summit Mine exploration included two drill holes and a series of trenches and shallow underground workings that explored a quartz vein for 1,000 feet. “Bonanza grades were occasionally encountered. One channel sample across the vein in the tunnel assays two feet of 90.9 ounces of gold per ton of rock,” the press release said.
Three drill holes and trenching results were reported for the Little Squaw Mine. One drill hole encountered a 60-foot section grading 0.166 ounces of gold per ton of rock. A second hole drilled from an underground station showed 10 feet of 0.22 ounces of gold per ton of rock, and a deeper 10 feet grading 0.46 ounces, possibly intercepting a new vein.
No drill holes tested the Eneveloe Mine, but exploratory tunneling along a quartz vein showed good gold values, according to the press release. A two-foot segment of a vein assayed 2.26 ounces of gold per ton of rock.
“The property has never been subjected to a comprehensive, well-funded and planned program employing modern exploration techniques,” Walters said in the press release.
He plans to do that, hoping to pull together about $4 million for exploration and development funding. Some placer mining is also being considered. Lobbying for road work Access is key to developing Little Squaw’s properties, Walters said. Past and current access is via air and a 61-mile winter trail. Little Squaw has four airstrips on its property block, in addition to the state-controlled 3,000-foot gravel runway at Chandalar Lake.
The winter trail starts at Coldfoot north of Fairbanks on the Dalton Highway, and ends at Chandalar Lake and the state airport. Little Squaw’s claims are eight miles northeast of the lake. Heavy mining equipment has been freighted over the route since the late 1950s, Walters said in a letter to Gov. Frank Murkowski, in a request that the state develop a road to Chandalar.
“Many millions of dollars have been spent attempting to move equipment and supplies overland, and in maintaining operations by air support that have adversely affected the economics of mining,” he wrote. “Until access can be improved, the property will fall far below its production potential.”
In his letter, Walters estimates Little Squaw’s potential ranges from 415,000 ounces of gold in proven, probable and possible reserves, supported by data from past operations, to a “conservative lode potential for more than 630,000 ounces” from a 1990 registered engineer’s report.
“Other exploration geologists believe that more than one million ounces can be proven-up in the six major quartz lodes known on the property, which are miles in length,” Walters said, in the letter.
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