With this year’s field season drawing to a close, the area play around the 5.2-million-oz. Pogo gold project in Alaska failed to generate much speculative interest or excitement for the dozen or so companies holding ground there.
The juniors that did manage to scrape together funds for exploration conducted first-pass reconnaissance mapping and sampling programs that revealed weak-to-low anomalous gold in soils and silts. For most, it was their first season of exploration in the Pogo area. The only junior to mount a drilling campaign was Ventures Resource (vrs-v).
Alaskan-based mineral consultant Avalon Development managed joint-exploration programs for nine different companies this past summer in the Goodpaster district. In doing so, Avalon had a pretty widespread look at different geological terrains in the district.
“[The work] showed us that the background for stream sediments, pan concentrates and soil samples in this district is quite low, averaging 8-12 parts per billion, as opposed to some place like the Fairbanks or Circle districts, where 50 to 100 ppb gold is relatively common in soils,” President Curtis Freeman tells The Northern Miner. “In some cases, 10 ppb may be a significant follow-up number.”
Freeman says these conclusions were corroborated by
“We’re going to have to lower our sights in terms of what we’re expecting out of stream seds and soils, and, at the same time, we’re going to have to be a whole lot more diligent about just simply scratching the hillside. If you find something that is an average 25-ppb anomaly in stream seds or soils, you had better go back and look.”
The high-grade Pogo is a blind deposit with no surface expression. Grassroots reconnaissance exploration in the early 1980s eventually led to its being drilled in 1994, but it was not until after their 1997 drill program that joint-venture partners Sumitomo Group of Japan and
The Pogo project is 90 miles east-southeast of Fairbanks and 40 miles north of the town of Delta Junction in the Goodpaster district of east-central Alaska. The property is accessible by helicopter and small fixed-wing aircraft, with road access limited to winter months.
The terrain consists of rolling, tundra-covered and lightly timbered hills, with a vertical relief of about 3,000 ft. The property encompasses about 72 sq. miles.
Teck can earn a 40% interest in the project from the subsidiaries of Sumitomo Metal Mining and Sumitomo Group by spending US$28 million and completing a feasibility study. Teck is responsible for the initial US$33 million of Sumitomo’s share of development costs.
The project is host to a conservatively estimated resource of 10 million tons grading 0.52 oz. gold per ton. A surface drilling program this past summer was expanded after encouraging values were intercepted along the southeastern perimeter of the Liesse deposit. The initial phase of drilling, which consisted of 25,000 ft., was primarily definition work with some stepouts to the southeast. During a third-quarter discussion with analysts, Stephen Dean, president of newly formed TeckGold, said the drilling was increasing the confidence level of the resource. An updated reserve estimate will be announced before year-end.
The Liese deposit, which occurs in the northwestern part of the Pogo claims, consists of a series of large, tabular, gently dipping subparallel quartz bodies hosted in Proterozoic-to-early-Paleozoic gneisses of the Tanana terrain. The deposit is 1 mile south of the southern margin of a mid-Cretaceous intrusive batholith suite.
Liese is divided into the main L1 zone and lower L2 zone, which are spaced 500 ft. apart. The bodies range in thickness from 1 to more than 70 ft., and average about 20 ft. The main L1 zone is 4,500 ft. long and 2,000 ft. wide, and remains open to the southeast and the northwest. Parts of L1 are within 350 ft. of surface.
A possible third zone, L3, has been pierced by two deep drill holes 400 ft. below L2. In addition, limited drilling has identified a discontinuous zone above the main L1 body.
About 3% of the quartz bodies consist of mineralization, with pyrite, pyrrhotite, loellingite and arsenopyrite being the dominant sulphides, together with lesser amounts of chalcopyrite, bismuthinite, maldonite and native bismuth. The gold is uniformly fine-grained.
Early biotite and later quartz-sericite stockwork and sericite-dolomite alteration are spatially associated with the Liese deposit, which shows characteristics of both vein and replacement styles of mineralization. Geochemical data suggest a strong correlation between gold and bismuth, as well as a weaker correlation between gold and other lithophile elements.
The summer drill program was expanded by about 20,000 ft., chiefly in order to target the southeastern extension of the L1 and L2 zones. Also, some 3,000-4,000 ft. tested mineralization extending north of the L1 zone across Liese Creek. A fault running parallel to Liese Creek may have cut the L1 zone and brought it closer to surface.
Drilling also confirmed the presence of at least two new easterly dipping, shear-hosted quartz veins father north in the North zone.
Last spring, Teck began driving an adit under Pogo Ridge as part of an underground evaluation program. The adit has been driven a distance of 1,600 ft, with a further 1,200 ft. to go before reaching the Liese quartz systems. Meanwhile, an underground plant has been constructed to treat the water generated from the workings. The objective of the underground program is to obtain geotechnical data, confirm the continuity of the quartz body and obtain a bulk sample for metallurgical testing. Initial tests indicate a gold recovery of 92-94% using conventional flotation and cyanidation of the sulphide concentrate.
Baseline environmental studies are ongoing and geotechnical work has been conducted on potential areas for tailings disposal. In late November, a prefeasibility study will be presented to the partners, who will then consider if a full feasibility is warranted.
Last year, regional reconnaissance work identified an 8-mile-long trend of anomalous gold in rocks and soils extending to the southeast. In particular, quartz boulder trains, found in four separate areas, yielded multi-ounce gold values, including 13-oz. and 28-oz. grabs from Tan Creek Ridge and 3 oz. from Sonora Creek Ridge.
Follow-up work in 1999 identified two potential zones of mineralization in the Sonora Creek area, 5 miles east of the Liese deposit. A series of outcropping and subcropping veins, similar in mineralogy to the Liese deposit, were traced for several hundred feet in an east-westerly direction. Fred Daley, vice-president of exploration, says initial sampling of the float material shows encouraging numbers, including several values in excess of 1 oz.
Geochemical sampling defined a “significant-size” soil anomaly covering several ridges in Sonora Creek, with gold values in excess of 100 ppb. The anomaly and surface showings were described as “substantially better than the original Liese” geochemical anomaly.
Sumitomo holds additional ground in the Pogo area, including the Black Mountain claims, which centre on the historic Grizzly mine, 14 miles east of Pogo. Grizzly had minor high-grade production at the turn of the century, and Sumitomo reportedly carried out further drilling on these claims in 1999.
A round-up of related activity in the Pogo area follows:
Veta property
In January, Teck exercised 1.38 million class A warrants of Ventures Resource at a price of $1.25 each, for proceeds of $1.7 million. Ventures used the proceeds to conduct further exploration on its 960,000-acre Veta property, 18 miles east of the Pogo property. The junior completed 8,000 ft. of core drilling in 10 holes that targeted geochemical anomalies in the 10-sq
.-mile Carrie Creek area on the western edge of the property block.
Five of the holes in the north segment intercepted values in the low 100s ppb, with the highest being 23 ft. of 0.03 oz. Results from three other widely spaced holes are pending, as are the results from the final two holes, which tested the newly discovered Serpentine gold anomaly to the south. The Serpentine anomaly measures 5,000 by 1,700 ft. in size.
Reconnaissance stream sediment sampling in the north-central block of the Veta property yielded values ranging from 30 to 1,000 ppb, while the highest panned concentrate values were in the ounces-per-ton range. Some of the anomalies share basins with other base metal prospects.
Teck has the right to choose one target on the Veta property and earn a 60% interest by completing a feasibility study.
Ventures controls the mineral rights to six large property blocks comprising more than 3 million acres through an exclusive agreement with Doyon, an Alaskan native corporation. The agreement, which extends until 2003, calls for annual payments of US$250,000 and annual exploration expenditures of US$1.5 million.
Rimfire
Backed by the principals and senior technical staff of Equity Engineering,
Western Keltic
Western Keltic has the right to earn up to an 80% interest in five properties equally owned with Rimfire. The properties are immediately east of Pogo.
Barrick will have the option of earning a 51% interest in any of the five properties by paying $100,000 per property and spending $1 million on each over three years.
During June and July, Western Keltic carried out an extensive reconnaissance geological program that was designed to evaluate some 70-sq. miles of mineral claims. The program consisted of prospecting, mapping and the collection of 281 rock, 286 stream sediment and 2,644 soil samples. All creek drainages were sampled, followed by topographic contour soil sampling across the slopes. A series of samples were taken at two different elevations; 330 ft. above the valley floor and 330 ft. below the ridge. The sampling program was designed to identify any potential leakage areas arising from flat-lying quartz veins.
This initial phase of work revealed three prospective anomalous areas — Boundary, Southeast Surf and Beverly Creek. The Boundary anomaly occurs along the northern portion of the border between the California and Surf properties. The anomaly is centred on a series of soil samples covering almost 2,300 ft. along a slope above a talus sample of quartz vein material that ran 0.66 oz. The soils yielded gold values ranging from 10 to 40 ppb, with anomalous arsenic, antimony, tellurium, tungsten and bismuth.
An additional 472 soil and 54 rock samples were collected during follow-up grid sampling of the area in September. Results from the first 32 rock samples included 0.72-oz. and 0.54-oz. grabs. Most of the rock samples were of quartz float containing arsenopyrite and lesser bismuthinite.
The broader Southeast Surf anomaly is 14,750 ft. long and up to 4,900 ft. wide, and coincides with a southeasterly trending magnetic low. Gold values in soils are up to 70 ppb, with associated arsenic, antimony, tungsten and bismuth. A single sample yielded 330 ppb just north of the anomalous trend. Large quartz veins are reported to have been found within the area. A total of 349 soil and 42 rock samples were collected in follow-up grid sampling. The first 21 rock samples to be assayed returned grades up to 0.13 oz.
A silt sample collected in 1998 from the Beverly Creek area of the California property returned better than 1,000 ppb gold. This year’s sampling confirmed the high gold in silt and yielded 100 ppb from a drainage immediately to the west. Three additional stream sediment samples from Beverly Creek returned values of 10-30 ppb.
Meanwhile, Blackstone Resources, which shares management with Western Keltic, has been unable to raise money for exploration in the current market. The company holds the 9-sq.-mile Falcon property, 25 miles southeast of Pogo.
Hyder Gold
Hyder Gold can acquire up to a 70% interest from Rimfire in five property blocks covering 35 sq. miles in the district. Hyder can earn an initial 51% interest by spending $1.3 million on exploration and making total payments of $230,000 in cash and 200,000 shares by Dec. 31, 2001. The company will be able to increase its interest to 70% by paying a further $1 million.
The initial 1999 program consisted of stream-sediment sampling, contour soil sampling, prospecting and geological mapping. Encouraging results included the delineation of a multi-element soil and silt anomaly measuring 16,400 ft. long by 650-3,300 ft. wide. The anomaly, which crosses the middle of the Eagle property, 15 miles southwest of Pogo, carries soil values up to 310 ppb.
On the Bou property, 25 miles southeast of the Pogo property, mineralized quartz veins up to 1.6 ft. wide, with associated arsenopyrite and pyrite, were noted in float boulders. A gold soil anomaly 1,600 ft. long lies northeast of the anomalous float samples, with values ranging from 5 to 110 ppb. A limited follow-up program of grid soil-sampling and mapping was completed in September.
Other activity in the region is outlined below:
Yukon-based Engineer Mining holds a 51% stake in a joint venture with Rimfire in the 7.5-sq.-mile ER claim block, 6 miles west of Pogo. The privately held company can increase its interest to 70% by spending $750,000 on exploration by the end of 2001. An initial public offering through Yorkton Securities could not be completed, and the company’s application for a VSE listing was allowed to lapse.
Copper Ridge has divided the Ogopogo property into four separate blocks.
Bravo also reached an agreement with Zeus Exploration to acquire a minimum 51% interest in three properties covering 13,000 acres in the Pogo area. To date, most of the work has been focused on the Divide property, east of Ventures’ Veta project
. An anomalous area measuring 950 by 2,300 ft. is reported to contain mineralized quartz veins and stockworks. Previous grab sampling yielded values up to 0.17 oz. gold, 1.1% copper and 3,860 ppb bismuth. Chip samples of the stockwork returned 5 ft. of 0.13 oz. and 1.5 ft. of 0.08 oz.
Bravo must issue 600,000 shares to Zeus and spend US$1 million on each of the West Pogo and Central properties, plus US$3 million on the Divide property.
Zeus is an affiliate of Colorado-based North Star Exploration, a privately held exploration company with an exclusive 5-year option on a 7-million-acre land package in Alaska’s interior.
Three anomalous areas of soils were outlined at Camnor’s South Salcha property, 40 miles northwest of Pogo. Grid mapping and sampling were completed over most of the property at line spacings of 650 ft., with stations every 330 ft. The sampling generated three distinctly linear, east-westerly trending anomalies at greater than 20 ppb gold. The highest soil value was 140 ppb.
Camflo Resources (cfk-a) switched its efforts to e-commerce and dropped its option to earn a 55% interest in Blue Desert Mining’s (bde-a) Gobi-Portal property, which covers 26 sq. miles immediately east of the Pogo project. Blue Desert has a 100% interest in four strategic properties totalling 88 sq. miles in the Pogo district. The company conducted a preliminary program of stream-sediment geochemistry.
Be the first to comment on "ALASKA & THE YUKON — Pogo area gold play mixed bag for juniors"