Freegold Ventures` Golden Summit Project
Transcription
Freegold Ventures` Golden Summit Project
North American mining giants such as Newmont, Barrick, Placer Dome and Freeport McMoran are burning through their reserves by producing by Leonard Melman many million ounces of gold per _______________ year—and those reserves must be replaced in order for their companies Massive area-wide forest fires to remain in operation. left the air near Fairbanks, Alaska Given these realities, Freegold’s looking like a London fog and strategy has been to smelling like the acquire as many ore residue of a fireplace bodies as possible. late this August as I They have been focusleft the airport on a ing on bringing into recent visit to Freetheir portfolio those gold Ventures Ltd. locations that have However, the poor the potential to bevisibility did little to come “elephants”— dampen my interest that is, mining propin exploring this area erties holding rethat is so rich in minsources sufficiently ing history. large enough to be atJunior mining tractive to those gicompanies appear to ants seeking to rehave three important place their dwindling factors working in reserves. their favor in this While some juniors general time frame. attempt to move toFirst, the ability of gold to hold near the Curt Freeman, Senior Geologist for Freegold, talks to a group about the Gold- ward early production $400 per ounce level en Summit Project. —Photo courtesy of Freegold Ventures Ltd. of high-grade areas to Freegold Ventures’ Golden Summit Project has made many ore bodies attractive that were potentially unprofitable with gold at or below $300 per ounce. Second, South Africa is becoming an increasingly difficult place to operate for the capital-rich South African mining giants who are now looking to shift their capital and operational expertise elsewhere. Third, the (Left) Trench sampling at Golden Summit. (Right) A view of the Union Bay project location. —Photos courtesy of Freegold Ventures Ltd. ICMJ’s PROSPECTING and MINING JOURNAL/October 2004 www.icmj.com 29 well as examination of core samples at the company core shack located just outside of Fairbanks. The project is located in the history-rich Fairbanks Mining District, which has witnessed various mining operations for over a century. Placer operations began near the turn of the last century and approximately ten million ounces of placer gold were recovered by 1964. Two thirds of that amount was found in streams draining the Golden Summit area while the remaining one third came from the Ester Dome region to the south. In addition to placer operations, some 538,000 ounces of lode gold was produced in the region between 1902 and 1980. The area then remained relatively inactive until the Fort Knox main focus of my visit, and the trip mine was opened in 1996, with total included briefings from corporate ex- production from that mine now nearecutives and geologists, visits to ex- ing three million ounces of gold. Fort Knox’s operations are of parploratory trenching in various parts of Golden Summit, inspection of the ticular interest to Freegold’s future nearby Fort Knox mine and mill, as plans. Fort Knox is currently producing approximately 350,000 ounces of gold per year. At that rate their ore body will become seriously depleted over the next several years, barring new and major discoveries on their properties. As the time of depletion draws near, excess capacity will develop at the milling plant and Freegold may be able to have their low-grade ore processed at Fort Knox on a fee basis. This would eliminate the enormous capital cost of building an entirely new milling operation to process low-grade ore—and the cost of building large scale mills is significant indeed. When the Fort Knox mine and mill were brought into production about a decade ago, the total development costs were in the area of $350 million. According to Peter Dasler, vice president at Freegold, plans are in the works to develop both low- and (Left) Trench sampling at Golden Summit. (Right) A view of the Union Bay project location. high-grade reserves at Golden Sum—Photos courtesy of Freegold Ventures Ltd. mit. The lower grades would be raise capital, and others acquire large amounts of debt to fund exploration and pre-development, Freegold’s plan has been to raise modest amounts of capital, acquire as many potential ore bodies as possible and then seek out joint venture partners who will fund the exploration expenses needed to prove up a quality ore body—giving up the rights to some portions of the properties in the process. Their specific goal is to prove up at least three million ounces of drill-indicated reserves over the next three years. Freegold’s list of properties includes locations in Idaho, Yukon Territory and the province of British Columbia with the greatest number of properties to be found in Alaska. Projects there include the Golden Summit, Rob, Rainbow Hill and Union Bay. The first three are primarily gold projects, while Union Bay involves the platinum group metals (PGMs). Freegold has partnered with 30 Meridian Gold at Golden Summit, northeast of Fairbanks, while Lonmin PLC has joint ventured with Freegold for exploration at the Union Bay Project in the southern Alaskan panhandle. Golden Summit Project was the www.icmj.com ICMJ’s PROSPECTING and MINING JOURNAL/October 2004 processed as a heap-leaching operation, trucking the ore a few miles to the Fort Knox mill for processing, while Meridian would build a smelter/refinery plant to process higher-grade ore bodies on site. Golden Summit contains several areas of particular interest including Cleary Hill, Hi Yu, Tolovana and Dolphin. Freegold recently completed trench sampling at Tolovana in order to prioritize drill targets for a program set to begin in late summer or early fall of 2004. Previous drilling ICMJ’s PROSPECTING and MINING JOURNAL/October 2004 at Tolovana intersected high-grade gold values in intrusive and associated metamorphic rocks. The extent of this mineralization is as yet unknown, but it bears striking similarity to mineralization at nearby Fort Knox. www.icmj.com 31 Cleary Hill was the Fairbanks District’s largest lode gold producer with 281,000 ounces of gold recovered from ore that graded an average of 1.3 ounces per ton. The mine was closed down in 1942 by the War Production Board and there has been no production since that time. Freegold performed trenching exploration during 2002 that intercepted multiple shear zones and veins with grades as high as 12.5 ounces per ton. Drilling operations in early 2003 and 2004 also intercepted multiple shear zones of lower grade ore. Additional step-out drilling is planned. Union Bay, in southern Alaska, is Freegold’s major PGM project and is joint ventured with major platinum producer Lonmin PLC. Results of a drilling program in 2003 suggest that the Union Bay project has the potential to host significant accumulations of platinum group mineralization. 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During the early summer of 2004, they entered into an option agreement whereby they may earn a 100% interest in the Grew Creek Gold Project located in Canada’s Yukon Territory near the town of Ross River in one of the coldest regions in all of North America. The project is located less than one mile from a major highway and is close to the Whitehorse power grid. Some resources have already been identified at the project and a ten-hole diamond drill program is now underway. Shortly following the Grew Creek announcement, Freegold also acquired a 100% staking interest in 400 claim units in the Kinesian area of northern British Columbia. A British Columbia Survey map released in January 2004 identified the area as being prospective to host Eskay Creek type VMS deposits. Eskay Creek remains one of the most notable ore body finds in Canadian mining history. Their remaining major property is the Almaden Gold Project in Idaho, where a feasibility study indicated a potentially mineable resource of 44 million tons of ore grading at 0.021 ounces per ton. The study indicated more than 500,000 ounces of gold was recoverable through open pit mining and heap leach technology. When the study was completed in 1997, the price of gold was too low to justify the expenditures required to bring the project to life, but at current gold prices near $400, Freegold has begun to actively seek a joint venture partner. _______________ Freegold welcomes your questions or comments via email at: spiros@ freegoldventures.com or visit: www. freegoldventures.com Drop in and visit our Quartzsite store at 980 West Main in Quartzsite, Arizona! 32 www.icmj.com ICMJ’s PROSPECTING and MINING JOURNAL/October 2004