Explorationists give porphyry deposits another look

But for those in the industry with some grey hair and experience with metals other than gold, porphyry deposits, whether the copper-gold or copper-molybdenum variety, aren’t new at all.

Discoveries by such distinguished mine-finders as Spud Huestis (Highland Valley), Egil Lorntzsen (Lornex) and Bernard Brynelson (Brenda Mines) all involved large porphyry deposits that enabled British Columbia to evolve into the largest copper producing province (1987) in Canada.

But reserves are rapidly dwindling at the province’s world class mines, many of which were developed from initial discoveries made in the 1950s and 1960s.

Norman Keevil Jr., president of the Mining Association of Canada, rang alarm bells when he made the point that without new discoveries, British Columbia’s copper mining industry could soon be a shadow of its former self.

Keevil called for more exploration to find new base metal reserves in order to sustain long-term employment and regional development, and to generate wealth to the province and country.

Despite some wariness by those who recall low metal prices and production cutbacks some years back (especially when the federal government was helping to finance low-cost mines in other countries), a growing number of companies and prospectors are responding to the call. Improved prices for most base metals is providing the necessary incentive, particularly for juniors looking to make deals with cash-rich major mining companies.

“A few years ago if you talked porphyry copper-gold, people laughed at you,” said Doug Forster of Continental Gold Corp. (VSE). “But now it’s in vogue and what explorationists are looking for.”

Continental has enjoyed considerable investor attention since it began drilling to develop reserves at the Mt. Milligan property. So far the company has outlined reserves estimated at 200 million tons grading 0.3% copper and 0.025 oz gold per ton, and four drill rigs are still at work. The original copper/gold discovery at Mt. Milligan was made by Richard Haslinger, a Fort St. James prospector.

Continental has a 70% interest with B.P. Resources Canada holding the remainder. However, most industry-watchers expect that Continental will be bought out by a major mining company that would then develop the project, if viable, into a large mining operation. Continental said its pre-feasibility work is examining a number of operating scenarios between 30,000 to 50,000 tons milled per day.

The company is also continuing exploration to find new targets on the 42-sq-mi property.

Pacific Sentinel Gold Corp. (VSE), which is managed by the same team as Continental, has secured ground about three miles to the west of Mt. Milligan. According to Doug Forster, the road-accessed property was explored briefly during the porphyry copper boom several decades ago.

“The geophysical signature of this property is identical to that of Mt. Milligan, however the ground is yet to be drill tested,” said Forster, noting that this style of deposit tends to occur in clusters. An exploration program is slated to begin later this month to be followed by drilling.

But Forster said another project to watch is the recently-acquired Western Star bulk tonnage gold- copper project near Nelson, B.C. The company is earning a 70% interest from Reymont Gold Mines and Lectus Developments (VSE). A 6-man crew has already been mobilized to the property.

Exploration work is expected to begin shortly, including work on the Star zone which Pacific Sentinel believes to be geologically similar to Mt. Milligan.

Geophysical and gold-copper soil anomalies are reported to be widespread and coincident with a highly fractured and altered diorite stock. Limited drilling at the margin of the stock returned 260 ft of 0.023 oz gold and 0.19% copper and 240 ft of 0.023 oz gold and 0.16% copper.

Pacific Sentinel’s 25,000-ft drill program is planned to start in August. The company will also be testing the 11-sq-mi property for its potential to host disseminated gold deposits.

Just 45 km from Mt. Milligan, Kookaburra Gold Corp. (VSE) is busy with field work on its Col porphyry copper-gold property. Initial work consists of a series of backhoe trenches testing gold-copper anomalies identified by last year’s program. The property was examined several decades ago for its copper potential based on a discovery by prospector Colin Campbell, but gold values weren’t tested at the time.

According to Don Rotherham, recent data is suggesting that the mineralized area previously worked on may be a satellite system to a main centre. The company plans more geophysical work to better define what it believes could be the main centre.

Kookaburra, which is largely held by Australian companies that view Canada as a prime grassroots exploration opportunity, also plans to drill key targets later this season.

Eastfield Resources (VSE) has been active in the region for a number of years, primarily on its Indata gold project. Although the main target is gold-bearing quartz sulphide vein systems, Glen Garratt of Eastfield said the company is seeing some evidence of porphyry- style copper mineralization in other parts of the property.

Several months ago Eastfield entered into an agreement with Northair Mines (VSE) allowing Northair to earn a 50% in the Swan property located near Smithers, B.C. Although some distance from Mt. Milligan, the companies say the property occurs within a geologic environment prospective for hosting copper-gold bulk tonnage deposits.

The Swan property was explored in the 1960s and 1970s as a porphyry copper prospect and although a large, low grade deposit was roughly outlined, its gold content was never tested. Garratt said the property was picked up this past winter.

“So far we only have a few samples run for gold, but it’s definitely a copper-gold association as far as we can determine,” he said.

The partners are planning to carry out mapping, geochemical and geophysical programs on a number of prospective targets this summer, with a possible surface drill program to follow.

Major mining companies, while generally more secretive, are no less active in the search for porphyry deposits.

“There are a lot of geologists from major companies in Fort St. James and MacKenzie,” said Don Rotherham of Kookaburra Gold. “This is the kind of play that attracts majors because it becomes heavy dollars after a while. And they can win big, too.”

Among the heavyweights active regionally is Noranda Exploration. Os Hachey, manager western region, confirmed that the main exploration target is indeed porphyry copper-gold mineralization similar to Mt. Milligan, but he wasn’t saying much else.

“Most of the projects are still in the early stages but we’re definitely active in this area,” he said.

Major companies are particularly attracted to copper-gold deposits because the gold credits can provide some protection against a downturn in copper prices.

“These large copper-gold deposits where gold and copper are about equal in value are really important,” said Peter Fox, a well-known consulting geologist working the area on behalf of a Vancouver-based major. “And much to the envy of the Americans, we have that kind of deposit in B.C.”

Westmin Resources (TSE) is a more recent entrant, having acquired four separate claim blocks near Mt. Milligan that were previously explored for their porphyry copper potential, but not tested for gold.

Harlan Meade of Westmin said two blocks were optioned to a major, while the remaining blocks were optioned to a junior with Westmin as operator.

“There should be a fair amount of activity on these properties in the next little while,” Meade said, confirming that porphyry copper- gold mineralization is the primary target, “with particular emphasis on significant gold values”.

Rio Algom (TSE) is said to be watching the area closely, and Teck Corp. (TSE) confirmed that it has
a reconnaissance crew working on a regional program.

Placer Dome (TSE) plans to drill test its Windy project some 20 km from Mt. Milligan. This property is a porphyry copper-gold situation, but the company also has gold projects in the area.

Imperial Metals (TSE) started a major work program that is expected to lead to a feasibility study for the Mt. Polley copper-gold project near Williams Lake. Reserves there are estimated at 53 million tons of 0.44% copper and 0.017 oz gold, believed sufficient for a 10- year, open pit mine life at 15,000 tons per day. Corona Corp. (TSE) has a 38.41% stake in this project.

The Mt. Milligan property is located in a regional belt where gold and copper-gold deposits are closely associated with alkaline intrusions. This long linear belt running roughly through the centre of the province, although discontinuous in places, can be extended to the north to include Sulphurets Gold Corp.’s (VSE) recently-discovered Kerr copper-gold deposit near Stewart, and to the south to include the Similco copper deposit being mined by Cassiar Mining (TSE) near Princeton.

The Kerr deposit is a particularly significant discovery in that an area estimated to contain in excess of 66 million tons of 0.86% copper and 0.01 oz gold has already been outlined.

While the recent new discoveries of the Mt. Milligan and Kerr deposits are rekindling exploration activity for porphyry deposits in British Columbia, the ironic twist is that both were initially drilled as part of exploration programs for — you guessed it — gold.

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