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Alaska mining industry tops billion-dollar mark 2002 exploration spending up 10 percent; 2003 should be even higher Curt Freeman Petroleum News Contributing Columnist
It’s official. The value of the Alaska mineral industry topped the billion-dollar mark again in 2002 and this at some of the lowest average gold, zinc and silver prices in 20 years!
Data recently released by the Alaska Division of Geological and Geophysical Surveys indicates that mineral exploration accounted for $26.5 million of the total, development projects contributed $34 million and production carried the lion’s share of value at $1,013 million.
For those of us geo-mercenaries watching the exploration markets with salmon-baited breath, 2002 exploration expenditures were up 10 percent over the previous year, the first year-on-year increase since 1998.
Although accurate numbers for 2003 are not yet in, the production value for 2003 should show a significant increase over 2002 since all of the major metals produced in Alaska, i.e., zinc, gold, silver, lead and copper, have enjoyed significant price increases in 2003.
In addition, renewed coal exports to Korea should bolster coal production figures for this year.
All in all, expect 2003 to surpass 2002 and if we can indulge in a little crystal ball gazing, 2004 is shaping up to be a bumper year for the Alaska mineral industry. Western Alaska Teck Cominco reported third quarter profits of $8 million at its Red Dog mine in western Alaska.
For the quarter, the mine generated 150,400 tonnes of zinc in concentrate and 31,600 tonnes of lead in concentrate, both figures up slightly over 2002 third quarter figures.
The mine also sold 131,800 tonnes of zinc in concentrate and 39,500 tonnes of lead in concentrate.
The increased revenue was due to higher head grades (21.8 percent zinc), reduced mine and smelter costs and an increase in the zinc price to 37 cents per pound during the quarter versus 34 cents per pound in the third quarter of 2002.
The company indicated that shipping of concentrates this season totaled 1,017,000 tonnes of zinc concentrate and 218,000 tonnes of lead concentrate.
Northern Dynasty Minerals reported additional core drilling results at the Pebble property copper-gold project near Iliamna.
Results include 210.3 meters grading 0.44 grams gold per tonne, 0.45 percent copper and 0.041 percent molybdenum in hole 3082; 70.1 meters grading 0.68 grams gold per tonne, 0.51 percent copper and 0.023 percent molybdenum in hole 3085; 52.3 meters grading 0.50 grams gold per tonne, 0.67 percent copper and 0.017 percent molybdenum in hole 3108; and 27.1 meters grading 0.52 grams gold per tonne, 0.71 percent copper and 0.019 percent molybdenum in hole 3116.
The drilling also indicated potential for expansion of resources to the southeast (outside the current resource base) where hole 3114 intercepted 115.8 meters grading 0.53 grams gold per tonne, 0.57 percent copper and 0.022 percent molybdenum.
Northern Dynasty expects to complete 65,000 feet of core drilling before the end of November with an updated resource estimate slated for release in December.
NovaGold Resources announced commencement of feasibility work at its Rock Creek gold deposit near Nome.
The company completed a 10,000-meter in-fill drilling program earlier this year and will use results of this drilling and other studies to complete a feasibility study by mid-2004.
A new sampling protocol initiated by the company suggests average grades may be higher than previously estimated due to significant nugget effect caused by coarse gold in the deposit.
These studies indicate that most of the samples containing more that 1 gram of gold per tonne contain significant amounts of coarse gold not normally reported by standard fire assay techniques.
Geotechnical and engineering work under way includes oriented core holes for pit and rock dump stability tests, completion of three of seven planned water monitoring wells and additional baseline environmental studies.
NovaGold hopes to submit initial permits to the state of Alaska in the third quarter of 2004 with initial start-up in the first quarter of 2006.
Ventures Resource released results from exploration on their Flat property in the Iditarod District. The drilling program included 5,500 feet of core drilling in eight holes at the Golden Apex, Divide and Golden Hornfels targets.
At Golden Apex, hole GA-2 intercepted 5.5 feet grading 0.208 ounces of gold per ton and 4 feet grading 0.391 ounces of gold per ton. At Divide, hole CM-25 intercepted 13 feet grading 0.032 ounces of gold per ton. At Golden Hornfels, hole GH-1A intersected 5 feet grading 0.136 ounces of gold per ton. Eastern Interior Alaska-newcomer Golden Spirit Minerals said it has acquired a 90 percent interest in the Ester Creek placer gold prospect near Fairbanks. The company plans to conduct sampling, trenching and technical evaluation of previously indicated mineralization on the property.
Welcome to Alaska Golden Spirit Minerals!
Alaska-newcomer Bright Star Ventures has purchased a 35 percent interest in the West Pogo prospect in the Goodpaster District. The remaining 65 percent of the property is under option to AngloGold US Exploration.
Bright Star retains the option to be carried to production resulting in a decrease in its ownership interest to 25 percent.
Welcome to Alaska Bright Star Ventures! Brooks Range Little Squaw Mining Co. said it has acquired an additional 7,000 acres of state mining claims at its namesake Little Squaw mine project in the Chandalar District.
The company also reported that previous drilling on Little Squaw Creek intersected potentially surface mineable placer gold resources downstream from the old lode gold workings.
Results from this drilling include 32 feet grading 0.058 ounces of gold per cubic yard in hole RCDH7 and 28 feet grading 0.073 ounces of gold per cubic yard in hole RCDH12. Weighted average drilling from two lines of drilling were 0.036 ounces of gold per cubic yard on line 1 and 0.057 ounces of gold per cubic yard on line 2 located 500 feet downstream of line 1.
Previous resource estimates suggest potential for upwards of 2 million cubic yards of gravel on Little Squaw Creek.
The company indicated it planned to raise capital for a definitive evaluation of the Little Squaw Creek placer prospect.
Silverado Gold Mines reported that soil sampling has outlined a three-mile long gold-arsenic-antimony anomaly on the Solomon shear zone near its Nolan Creek gold mine in the Brooks Range. Streams draining the shear have produced upwards of 200,000 ounces of gold in placer form.
The company mobilized a reverse circulation drill to the project in September and intends to continue exploration in the fall and winter.
Silverado also said that summer surface drilling had outlined a small open pit mineable placer gold resource containing an estimated 2,081 ounces of gold at a grade of 0.12 ounces of gold per cubic yard of gravel. Plans are under way to expand this zone for possible future mining. Southeast Alaska The U.S. Forest Service has approved permits for the expanded tailing facilities proposed at the Greens Creek mine on Admiralty Island. The permits will allow mine owners Kennecott (70.3 percent) and Hecla (29.7 percent) to expand their surface tailing facilities and allow an additional 20 years of storage to occur.
The mine’s current 29 acre site has only two years of capacity remaining so the additional 61.3 acres of storage capacity could not have come at a better time.
Bravo Venture Group released preliminary drilling results from the Lost Lake volcanogenic massive sulfide prospect on its Woewodski Island project near Petersburg.
Previous drilling by Amselco in the 1980s returned values up to six feet grading 6.47 ounces of silver per ton, 6.34 percent lead and 16.5 percent zinc. Shallow scout drilling conducted in 2003 included five holes over a 20 meter strike length and returned significant sulfide mineralization in all holes, including 1.2 meters grading 102 grams of silver per tonne, 0.42 percent lead and 6.8 percent zinc and 4.7 meters grading 67 grams of silver per tonne, 0.29 percent lead and 7.1 percent zinc.
Five additional massive sulfide targets were evaluated in 2003 with surface grab and channel sampling returning values up to 96.2 grams per tonne silver, 2.7 grams per tonne gold and 8.2 percent zinc. Other The annual Alaska Miners Association Convention was held in Anchorage in early November.
For the first time in five years the atmosphere at the convention held a palpable excitement due to increased prices for gold, silver, platinum, zinc, lead, copper and nickel. Attendance at the meeting was up over last year and the organizers did their normally superb job of running the conference.
Congratulations to all involved!
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