Loki asks Hemlo to prepare Brewery Creek feasibility

Having earned a 49% interest in the Brewery Creek project near Dawson, Yukon, Loki Gold (VSE) is requesting the operator Hemlo Gold Mines (TSE) to present a program contemplating the preparation of a feasibility report.

Loki President Ken Carter said the company is of the opinion that sufficient reserves already exist on the Yukon property to support a medium-scale heap leach operation. It appears, however, that because of a higher threshold for mine development, Hemlo intends to continue work aimed at determining the property’s “global reserve potential.”

At last report, Brewery Creek had preliminary reserves of 17 million tons in nine deposits with an average grade of 0.055 oz. gold per ton. Oxide reserves account for 11.9 million tons grading 0.058 oz. gold, with a strip ratio of 1.17-to-1.

Hemlo’s recently completed, first-phase exploration program consisted of induced polarization surveys, mechanical trenching of 202 test pits, and geological mapping.

This work is reported to have extended the favorable intrusive-sediment corridor hosting known reserves to the east and southeast a further 2.1 miles. Loki also said other exploration targets were identified that warrant further evaluation along favorable host rocks traceable over a 7.4-mile strike length.

Before commissioning a feasibility report, the joint venture intends to further examine potential for reserve enhancement.

A $600,000 program of test pitting, drilling and environmental studies is under way, to be completed by September. Hemlo is proposing to spend up to a further $1.8 million by mid-1993 to complete its evaluation of the property’s global reserve potential.