EXPLORATION ’87 NORTHGATE

At presstime a final budget for exploration had not been determined at Northgate, but several affiliated companies had announced plans for significant expenditures in 1987. Norbeau Mines (40%-held by Northgate), for example, plans to spend $800,000 on five of its 22 properties in Quebec in addition to about $250,000 that’s earmarked for an underground program at the old Norbeau mine, near Chibougamau.

Orofino Resources (about 68%-held by Northgrate) plans to spend $1.5 million in Scadding Twp., Ont., and an additional $250,000 on the company’s original gold property in the Swayze area. Both are north of Sudbury.

Vancouver-based Westfield Minerals (about 35%-held by Northgate) is somewhat of a holding company rather than an active exploration and development company, so no budget has been set.

Northgate itself will spend in the order of $2-$4 million exploring extensions to its two producing gold mines in Chibougamau. The major objective here will be to extend the life of the mines and possibly justify mill expansion. A major drilling program will be mounted from lake ice over another shear zone in the area where two holes intersected gold values last year. Underground work in Chibougamau will concentrate on testing known ore zones below the 4,000-ft level.

All of Northgate’s exploration work operates under three guiding principles, according to chief geologist Gerald Harper. These are:

* Properties must be within 5-25 miles of a road, power line or a townsite.

* Exploration is aimed at small deposits that can be brought into production within five years at a rate of 200-300 tons per day.

* Preference will be given to properties held by junior companies which have identified some reserves but which can not see a sensible way to put the property into production.

Northgate spends no more than 5% of its total budget on grassroots exploration. “We do no regional geology at all but are strong believers in knowing the geology of a property through detailed (1:100) mapping and developing geological models based on field data,” Harper says.

Orofino, for example, is very excited about two properties in the Mine Centre area of northwestern Ontario known as the Fort Francis properties. Orofino optioned the two which are on the margin of an igneous intrusive south of Mine Centre and has further optioned half of its potential 80% interest to Alberta-listed Dore Exploration. On a large land-holding in Quebec, as well, Norbeau is planning a major, 3-year surface mapping program of the southern margin of the anothosite complex, which hosts the old La Mor mine. The program will likely cost $4 million and include 100,000 ft of drilling. About $500,000 will be spent this year. Northgate is most interested in properties that have the potential to become producers within five years in the 200-300-tons-per-day range.

Orofino’s Norstar deposit, north of Sudbury, is an example. It was mined out in just three months last year and the 69,000 tons of ore is now being processed at the company’s Scadding mill, eight miles away, at a rate of 5,000 tons a month. When that milling is completed sometime this year, Orofino expects to net close to $1 million with an equal amount going to joint-venture partner, Groundstar Resources of Vancouver.

Orofino intends to spend $1.5 million on ramping, bulk-sampling and underground drilling on the intermediate zone of its Scadding property. Once this program is completed (by early fall), the company will decide whether it’s economic to mine the deposit. Additional trenching is also planned on two geochemically anomalous areas in the same area.

Orofino will also do work on properties in the Uchi Lake, Red Lake and Beardmore areas. The Red Summit property, west of Red Lake, will receive considerable attention this year. Work in the 1930s turned up some 38,000 tons grading 0.23 oz gold per ton in a zone that’s wide open in all directions.

Northgate will also be drilling two base metals properties this year: one north of Beardmore (in terrain not unlike that which hosts the Winston Lake deposit) and one in British Columbia, near the town of Mackenzie.