Sunday 25th June 2017

Resource Clips


Posts tagged ‘british columbia’

The Greenwood renaissance

June 23rd, 2017

Golden Dawn Minerals moves to revive the historic B.C. mining camp

by Greg Klein

It’s a case of one bold decision leading to another. Among the companies that saw opportunity during the downturn, Golden Dawn Minerals TSXV:GOM began picking up past-producers, assembling a cluster of properties radiating around a mill in south-central British Columbia’s fabled Greenwood mining district. Now, with a recently released PEA and some of the permits in place, the company’s ready to boldly venture into trial mining sans feasibility.

Company adviser George Sookochoff credits president/CEO Wolf Wiese with being “very aggressive in making deals, acquiring properties and putting together this fantastic package. Now that markets are looking better, he’s already got his projects and financing lined up.”

Golden Dawn Minerals moves to revive the historic B.C. mining camp

Golden Dawn’s mill plays a vital role in the
company’s plans to re-activate the past-producing mines.

So extensive is Golden Dawn’s portfolio that it reads more like a catalogue. But the initial focal points constitute a mill with three nearby past-producers: the Lexington-Grenoble gold-copper, Golden Crown gold-copper and May Mac gold-silver-lead-zinc mines. The company’s crushing-grinding-gravity-flotation mill and tailings facility has a 212-tpd capacity expandable to 400 tpd. Built in 2007, it’s been on care and maintenance since the end of 2008.

“The mill is key to the potential success of this economic model,” Sookochoff explains. “It enables us to mine and process smaller deposits. We’ll find bigger deposits if they’re there but we could keep feeding the mill with these smaller deposits. All these projects are within 15 kilometres of the mill.”

With the advantages of refurbishable infrastructure straddling a highway 500 kilometres east of Vancouver, the PEA calculates a very high after-tax IRR of 103.4% and NPV of $19.7 million. Capex would come to $27.2 million, including pre-production costs of $3.4 million spent over six months. Payback would come in 1.4 years, while the life of mine would be 4.6 years.

The limited lifespan, of course, highlights the importance of resource expansion, Sookochoff emphasizes.

This week the company announced provincial approval to re-activate Lexington and the mill. The 2,020-hectare Lexington property had its underground infrastructure expanded by a previous operator that mined the project from April to December 2008, producing 5,486 ounces of gold, 3,247 ounces of silver and 860,259 pounds of copper that was processed at the Greenwood mill. Using a 3.5 g/t gold-equivalent cutoff, Lexington has a 2016 resource showing:

  • measured: 58,000 tonnes averaging 6.98 g/t gold, 1.1% copper and 8.63 g/t gold-equivalent for 16,100 gold-equivalent ounces

  • indicated: 314,000 tonnes averaging 6.38 g/t gold, 1.04% copper and 7.94 g/t gold-equivalent for 80,200 gold-equivalent ounces

  • inferred: 12,000 tonnes averaging 4.42 g/t gold, 1.03% copper and 5.96 g/t gold-equivalent for 2,300 gold-equivalent ounces

At Golden Crown, meanwhile, permitting is in process for surface drilling to upgrade the resource and test for extensions. The 1,017-hectare property underwent small-scale underground gold-copper mining early last century and extensive exploration on and off since then. Using a 3.5 g/t gold-equivalent cutoff, Golden Crown’s 2016 resource shows:

  • indicated: 163,000 tonnes averaging 11.09 g/t gold, 0.56% copper and 11.93 g/t gold-equivalent for 62,500 gold-equivalent ounces

  • inferred: 42,000 tonnes averaging 9.04 g/t gold, 0.43% copper and 9.68 g/t gold-equivalent for 13,100 gold-equivalent ounces

May Mac also has permit applications under review, these ones for underground drifting, drilling and bulk sampling. A previous round of underground drilling wrapped up in spring, resulting in high-grade silver-gold-base metals assays. Surface drilling continues.

But Golden Dawn’s very extensive assets—again, all proximal to the mill—offer additional potential to keep the facility busy beyond the PEA’s timespan. Among them are 29 former mines covering 11,000 hectares that came with the January acquisition of Kettle River Resources. One focus is the former Phoenix mine that reportedly gave up around 500 million pounds of copper and nearly one million ounces of gold. Sookochoff, a database specialist, has been poring over something like a century’s worth of files including approximately 3,000 maps and 500 reports.

In the last few years especially, junior companies have been able to acquire so much data that it’s a challenge to handle it efficiently.—George Sookochoff
Golden Dawn Minerals adviser

“In the last few years especially, junior companies have been able to acquire so much data that it’s a challenge to handle it efficiently,” he says. Nevertheless, after compiling the archives and incorporating new exploration data, he hopes to see some “deeper-seated feeder systems” underlying the shallow former mines.

Phoenix has deep-penetration airborne VTEM planned for September, he says. “If we get a strong anomaly coincident with a former mine, we’ll know that’s a mineralized geophysical signature and we’ll look for similar signatures around the property. This should be extremely valuable to identify larger systems deeper down, or even smaller ones closer to surface.”

Additional potential, not covered by the PEA, could come from Washington state. Earlier this month Golden Dawn announced an LOI for the Lone Star copper-gold property just across the border and contiguous with Lexington. With “material that looks very suitable to our mill,” the 234-hectare property would come with a 2007 estimate that the company considers non-43-101:

  • indicated: 63,000 tonnes averaging 1.28 g/t gold and 2.3% copper for 2,600 ounces gold and 3.19 million pounds copper

  • inferred: 682,000 tonnes averaging 1.46 g/t gold and 2% copper for 32,000 ounces gold and 30.07 million pounds copper

Big plans notwithstanding, Golden Dawn’s not immune to the typical junior hope that a senior might come knocking. The Greenwood camp’s largest landholder is Kinross Gold TSX:K. As the company’s Buckhorn mine close to the B.C. border in Washington state nears depletion, Kinross might look for other convenient assets to keep its Kettle River mill in operation, Sookochoff suggests. That might make some of Golden Dawn’s primarily gold assets attractive, although the high-grade copper projects would be more suitable for the Greenwood mill, he says.

As a native of Grand Forks, about a half-hour drive east, Sookochoff says the region shows strong community support for mining. A packed open house held in December went very well, he adds, and the company enjoys “very positive relations with the Osoyoos Indian Band. They’re very supportive, very pro-business.”

Earlier this month Golden Dawn closed the final tranche of a private placement totalling $1.76 million. In February the company closed a gold purchase agreement that brought in US$4 million. That same month the company received a US$1-million increase in a convertible security that began the previous August at US$2.4 million. Even with the caveat that the company intends to proceed without feasibility-level de-risking, the PEA allows Golden Dawn to return to the market “with a stronger story now,” says Sookochoff.

Mountain Boy Minerals drills more visible gold at B.C.’s Golden Triangle

June 21st, 2017

by Greg Klein | June 21, 2017

With two rigs busy, Mountain Boy Minerals TSXV:MTB intersected visible gold above historic underground workings on northwestern British Columbia’s Red Cliff property. Assays are still pending, but one of the holes that intersected a sheared, mineralized intrusive on the Montrose zone showed the welcome sight of yellow within numerous galena stringers. The company added that mineralization within the two most recent holes resembles a previously reported hole from the same zone that graded 14.53 g/t gold and 0.27% copper over 30.64 metres.

Mountain Boy Minerals drills more visible gold at B.C.’s Golden Triangle

The sight of gold attracts Mountain Boy Minerals
more than Red Cliff’s rugged scenery.

Work continues to test an approximately 200-metre vertical distance between the previous holes and the past-producer’s workings.

About 900 metres south of Montrose, meanwhile, the other rig targets the Red Cliff zone, where quartz with chalcopyrite, pyrite and sphalerite has been found in zones up to five metres in width.

The program also intends to confirm previous results from the property’s Waterpump zone, a goal that will require a drone and possibly climbers to find a 1988 mountainside drill collar.

Mountain Boy has a 35% stake in the project, with JV partner Decade Resources TSXV:DEC holding the remainder.

In deals re-negotiated with Great Bear Resources TSXV:GBR earlier this month, Mountain Boy increased its options on two other Golden Triangle properties, Surprise Creek and BA, from 50% to 100%. Other northwestern B.C. interests include a 100% stake in the MB project, with historic, non-43-101 polymetallic estimates; a 50% stake in the George property, with non-43-101 copper-silver-gold estimates; a 20% stake in Silver Coin, with a gold-silver-base metals resource; the American Creek and Bear Valley silver-base metals projects; as well as copper-gold claims. In southern B.C., Mountain Boy prepares to begin PEA studies on its Manuel Creek zeolite project.

Read more about Mountain Boy Minerals.

See an infographic about B.C.’s Golden Triangle.

Conuma Coal Resources CEO Mark Bartkoski says government and community support helped his company re-open a B.C. mine closed by Walter Energy

June 20th, 2017

…Read more

Amid political uncertainty, former B.C. mines minister joins Eagle Plains Resources

June 15th, 2017

by Greg Klein | June 15, 2017

Three days after finishing his term as British Columbia’s minister of mines and energy, Eagle Plains Resources TSXV:EPL announced Bill Bennett’s appointment as a director. Bennett chose not to run in last month’s election but officially held the ministry until a new cabinet was sworn in on June 12.

Amid political uncertainty, former B.C. mines minister joins Eagle Plains Resources

During his 16 years as an MLA, Bennett served three stints as minister of mining. Calling him the government’s “go-to person” for the industry, Eagle Plains stated, “There are few people in Canada who have such a strong combined knowledge of government processes, of the mining industry and of First Nations.”

Eagle Plains is a project generator with a portfolio in B.C., Yukon and Saskatchewan. Bennett replaces Canadian Mining Hall of Fame inductee Ron Netolitzky, who moves to the company’s advisory board.

Bennett’s replacement at the legislature cabinet table, meanwhile, is Rich Coleman, a former mines minister himself who most recently held portfolios for natural gas development and housing.

How long the cabinet will last, however, remains to be seen. The May election destroyed the governing BC Liberals’ majority, leaving the party with just 43 seats compared with 41 for the New Democratic Party and three for the Greens. The latter party has since signed a pact to support an NDP minority government. Among other ramifications, the deal would presumably give the NDP’s own environmentalists additional influence relative to the party’s supporters from the labour movement.

But speculation persists that the accord could crumble, possibly sooner rather than later.

As the legislature reconvenes on June 22, B.C. faces the possibility of a snap election with the Liberals best prepared to finance a campaign. According to Black Press correspondent Tom Fletcher, that party raised more money than it was allowed to spend last time around, while the other two parties “are likely broke if not in debt.”

Additionally, the National Post reported that the Liberals raised over $300,000 within 48 hours of the NDP and Greens announcing their agreement.

92 Resources begins frac sand field work while advancing lithium metallurgy

June 6th, 2017

by Greg Klein | June 6, 2017

With a crew already en route, 92 Resources TSXV:NTY has a 10-day exploration program about to begin on its Golden frac sand project in eastern British Columbia. A team from Dahrouge Geological Consulting will undertake further mapping and sampling for a 43-101 technical report. While the company’s focus remains the Hidden Lake lithium project in the Northwest Territories, 92 Resources sees potential in another energy-related commodity.

92 Resources begins frac sand field work while advancing lithium metallurgy

“Despite fluctuating oil and gas prices, North American demand for frac sand is exceptionally robust and there remains a nearly non-existent domestic supply of high-quality proppant within Canada,” said president/CEO Adrian Lamoureux.

Close to the Alberta border and with nearby roads, the property’s located five kilometres from Golden, B.C., on the Canadian Pacific main line. Adjacent to the property is Heemskirk Canada’s Moberly project, a former producer of silica sand for the glass industry that’s now being redeveloped as a frac sand production and processing operation. The parent company, Heemskirk Consolidated, is the object of a takeover bid by Northern Silica, held by Taurus Resources No. 2 Fund.

Running through the 3,211-hectare Golden property is an 18-kilometre strike of the Mount Wilson formation, described as hosting high-purity, white, quartzite and friable sandstones. Four samples collected in 2014 showed silica content averaging 98.6% SiO2, with low boron and iron values. “Preliminary testing on these samples indicates favourable frac sand characteristics, as well as metallurgical-grade silica potential,” 92 Resources stated.

Last week the company announced initial results from Phase I metallurgical tests for its Hidden Lake lithium property in the NWT. Early findings suggest material from the hard rock project might be suitable for a conventional flowsheet. As the program goes into Phase II, potential tantalum recovery will be examined as well. 92 Resources filed a 43-101 technical report on the property in January.

The company also holds the 5,536-hectare Pontax lithium property in northern Quebec.

The ‘serially successful’

June 2nd, 2017

The International Metal Writers Conference hears Rick Rule dissect the traits of mining titans

by Greg Klein

The International Metal Writers Conference hears Rick Rule dissect the traits of mining titans

The International Metal Writers Conference hosted the world’s largest
gathering of investment newsletter writers. (Photo: www.VisionPhoto.ca)

 

“It’s all about the people.” That sentiment popped up repeatedly this week at the International Metal Writers Conference, where several speakers related their most important consideration in evaluating stocks. Maybe no one expressed it more emphatically than Zimtu Capital TSXV:ZC president Dave Hodge, whose unamplified but booming voice overwhelmed the event’s microphone-dependent speakers, even seeming to threaten the Vancouver Convention Centre with seismic damage.

“No matter what the company is, no matter what the commodity is, what makes stocks successful is the management!” he roared. “What really determines a winner in this high-risk game is the management!”

Good people, he argued, will overcome bad projects. And it wasn’t just his volume that drove the point home. As newsletter writer David Morgan noted, “I think everyone from Rick Rule on down will tell you it’s all about the people.”

The International Metal Writers Conference hears Rick Rule dissect the traits of mining titans

Rick Rule, Frank Holmes and Jayant Bhandari were
among some 50 speakers who shared their insights.

Rule expanded on that the following morning when he said, “The most important determinant for success is not properties, not assets, but rather people.” But what kind of people? Successful ones obviously, especially those Rule calls the “serially successful.” So what do they have in common?

His association with several titans of the industry led him to ponder their similarities. Some of the names he mentioned include Seymour Schulich, Aldof, Lukas and Ian Lundin, Robert Friedland, Ross Beaty, Bob Quartermain and Clive Johnson.

“This isn’t to say they haven’t had failures on occasion,” Rule acknowledged. “Robert Friedland’s first effort, Galactic, was a galactic failure.”

But there’s a compound benefit to success. Those who achieve it “attract better people,” Rule said. “The people who are serially successful attract other serially successful people to them. And they attract better projects…. Similarly with the quest for capital.”

Among their traits, they’re “pathologically curious…. I think this makes them successful because they’re not willing to accept present dogma. I think because they’re curious they approach a problem from a whole bunch of points of view. It’s certainly true that many of the properties that become successful have had three or four approaches before the approach that made them successful.”

Not surprisingly, success-mongers turn out to be “really, really hard-working and focused.” And they’re “very smart,” although intelligence alone hardly guarantees success, he warned.

Additionally, the winners prove to be “amazingly tenacious. They carry a project in good times through bad times, carry it through the bad times back into good times.” Rule says they’ll commonly remark, “Yup, on that deal I worked seven years to be an overnight success.”

And stereotypes of domineering fat cats notwithstanding, “another thing I found out is these people turn out to be extremely nice,” Rule maintained. “They are, in my experience, genuinely happy that they delivered value to their employees and shareholders…. They want to build a mine. They want to employ local people. They want their shareholders to do well.”

The International Metal Writers Conference hears Rick Rule dissect the traits of mining titans

There’s more to life than money,
insisted Zimtu Capital’s Dave Hodge.

As for their own stock, “They buy once and they sell once.” They might sell options from time to time, but they don’t cash out until their involvement in a project finishes, Rule said.

“Sadly,” the 60-something concluded, “they’re all my age…. The challenge is to find the next generation of the serially successful people.”

Echoing those comments, another well-connected industry insider believes the replacements might already be making their presence known. Mining headhunter Andrew Pollard of the Mining Recruitment Group presented six such prospects, three each on two panel discussions. One showcased a 35-and-under power trio while the other presented a threesome slightly older and commensurately closer to serial success status.

But isn’t this definition of success overly materialist? Surely life has loftier goals than ardent ambition, the lust for lucre, the mania for moolah. That was another point stressed most emphatically by Zimtu’s Dave Hodge.

“It’s not about the money!” he thundered to the four corners of the convention hall. “It’s about the bragging rights!”

Golden Dawn Minerals to add American past-producer to B.C. holdings

June 2nd, 2017

by Greg Klein | June 2, 2017

Geology disregards the 49th Parallel, so Golden Dawn Minerals TSXV:GOM has turned to northern Washington state to expand its southern British Columbia portfolio. Under a non-binding LOI announced June 2, the company would acquire the 234-hectare Lone Star copper-gold property in the U.S. contiguous to its Greenwood claims in B.C.

Golden Dawn Minerals to add American past-producer to B.C. holdings

Golden Dawn hopes to revive the historic silver-gold-polymetallic camp, beginning with the former May Mac, Lexington and Golden Crown mines, all proximal to the company’s gravity-flotation mill with a 200-tpd capacity expandable to 400 tpd.

Another past-producer, Lone Star operated from 1897 to 1918 and from 1977 to 1978. An estimate compiled in 2007, which Golden Dawn considers historic and non-43-101, showed:

  • indicated: 63,000 tonnes averaging 1.28 g/t gold and 2.3% copper for 2,600 ounces gold and 3.19 million pounds copper

  • inferred: 682,000 tonnes averaging 1.46 g/t gold and 2% copper for 32,000 ounces gold and 30.07 million pounds copper

Lexington’s rock types, structure and gold-copper mineralization continue south onto Lone Star, the company stated, “forming a three-kilometre-long prospective exploration trend of past-producing gold-copper mines and prospects, including the Lexington-Grenoble, Lexington, No. 7 and Lone Star mines.”

The new acquisition would cost Golden Dawn $200,000 cash and $200,000 in shares determined at the average price prior to announcing the LOI. A 2.5% NSR applies.

In April the company released silver-gold-lead-zinc assays from underground drilling at May Mac. Metallurgical tests for the past-producer have been conducted at the Greenwood mill, 15 kilometres away.

Golden Crown, meanwhile, has an application pending for surface drilling and preparations are underway for field work at the more recently acquired Kettle River properties.

Golden Dawn plans to reopen May Mac, Lexington, Golden Crown and the mill without de-risking the project at the feasibility level. Prior to filing on Sedar, the company is currently reviewing a recently completed PEA on all its B.C. Greenwood holdings. The report was commissioned to support a short form prospectus.

On June 2 Golden Dawn also closed the final tranche of a private placement totalling $1.76 million. Last February the company received a US$4-million advance on a gold purchase agreement.

Located about 500 kilometres east of Vancouver, the Greenwood properties have nearby highway access.

Mountain Boy Minerals increases B.C. Golden Triangle presence with two 100% options

June 2nd, 2017

by Greg Klein | June 2, 2017

Mountain Boy Minerals increases B.C. Golden Triangle presence with two 100% options

Home to major deposits as well as earlier-stage exploration, the rugged
terrain of B.C.’s Golden Triangle has Mountain Boy Minerals intrigued.

Encouraging results have prompted Mountain Boy Minerals TSXV:MTB to up its stake in two northwestern British Columbia projects from 50% to 100% options. The company signed the agreement with Great Bear Resources TSXV:GBR, up to then a 50/50 JV partner on both properties, Surprise Creek and BA.

Together, the two nearby projects have undergone over $12 million of exploration spending over the last decade.

As project operator in February, Mountain Boy announced a major base metal-silver-barite zone at Surprise Creek, where one hole on the 7,472-hectare property revealed these intercepts:

  • 0.12 g/t gold, 28 g/t silver, 1.21% zinc, 0.03% lead, 0.31% copper and 46.73% barite over 18.94 metres, starting at 58.26 metres in downhole depth

  • (including 0.11 g/t gold, 44.75 g/t silver, 4.31% zinc, 0.05% lead, 0.33% copper and 67% BaSo4 over 4.58 metres)

  • (which includes 0.09 g/t gold, 70.7 g/t silver, 6.49% zinc, 0.09% lead, 0.56% copper and 60.48% BaSo4 over 2.14 metres)

True widths weren’t provided.

Sample results released in January from the 9,489-hectare BA VMS project showed:

  • 14.3% lead and 1,080 g/t silver
  • 32.4% lead and 417 g/t silver
  • 20.3% zinc, 6.73% lead, 255 g/t silver and 100 ppb gold
  • 33.1% zinc, 1.57% lead and 192 g/t silver
  • 4.41% copper and 142 ppb gold

Subject to approvals, the option lets Mountain Boy take Great Bear’s 50% of both projects by paying $1.3 million and issuing 10 million shares in stages by August 20, 2020. On achieving certain milestones, additional cash payments to Great Bear could total $3.7 million should both properties go into production.

Mountain Boy’s Golden Triangle portfolio includes a 20% stake in the Silver Coin gold-silver-base metals project with a resource estimate, the American Creek and Bear Valley silver-base metals projects, as well as copper-gold claims.

Read more about Mountain Boy Minerals.

See an infographic about B.C.’s Golden Triangle.

92 Resources advances metallurgy for NWT hard rock lithium

June 1st, 2017

by Greg Klein | June 1, 2017

Phase I mineralogy studies have 92 Resources TSXV:NTY confident that its Hidden Lake lithium project in the Northwest Territories could be amenable to a conventional flowsheet. QEMSCAN and Electron Probe Micro Analysis on a composite sample from each of four pegmatites showed similar results, confirming spodumene as the primary host of lithium. The coarse-grained spodumene shows very good liberation characteristics and low iron content, the company stated.

92 Resources advances metallurgy for NWT hard rock lithium

The 1,659-hectare Hidden Lake project has all-weather
road access to Yellowknife, 45 kilometres southwest.

Spodumene liberation “indicates a strong potential for recovery using dense media separation and flotation techniques, which are common processing methods applied to spodumene-bearing pegmatites,” 92 Resources added.

The program also found potential for tantalum recovery, which will be further assessed in Phase II. About to begin, the program will conduct flotation tests to determine the reagent scheme and assess the ability to produce spodumene concentrate without additional processing.

Last year’s channel sampling targeted four of six known lithium-bearing spodumene dykes, with the best result showing:

  • 1.58% Li2O and 31 ppm Ta2O5 over 8.78 metres

  • (including 1.78% Li2O and 31 ppm Ta2O5 over 6.93 metres)

The company filed a 43-101 technical report on Hidden Lake in January.

92 Resources’ portfolio also includes the 5,536-hectare Pontax lithium prospect in northern Quebec and the 3,211-hectare Golden frac sand project in southeastern British Columbia.

In February the company closed an oversubscribed private placement of $895,199.

Saskatchewan Mining Association chairperson Jessica Theriault signals “growing leadership role of women in mining”

May 25th, 2017

by Greg Klein | May 25, 2017

The director of environmental affairs for The Mosaic Company NYSE:MOS, Jessica Theriault has been elected to lead the Saskatchewan Mining Association board. A former SMA director and member of its environment committee, she has an environmental engineering degree and MBA from the University of Regina, along with 19 years of environmental experience in Saskatchewan potash mining.

Saskatchewan Mining Association chairperson Jessica Theriault signals “growing leadership role of women in mining”

Jessica Theriault

Theriault succeeds Neil McMillan, who serves as chairperson of Cameco Corp TSX:CCO.

“Given the importance of mining to the Saskatchewan and Canadian economies, and the strength of our industry’s reputation, my focus as chair will be to ensure that we continue to deliver, but also drive improvements across the sector,” said Theriault.

Elected as SMA vice-chairperson was Tammy Van Lambalgen, VP of corporate affairs and general counsel for AREVA Resources Canada.

Although the SMA already has a female president in Pamela Schwann, the association noted that Theriault will be the first woman to lead its board. Her election, along with that of Van Lambalgen, “represents a significant milestone in signalling the growing leadership role of women in mining,” the SMA stated. “It also shines a light on the diversity of rewarding careers for women in the mining sector in Saskatchewan, home to global mining and exploration companies and the top jurisdiction in the world for attracting mineral investment according to the annual Fraser Institute Survey of Mining Companies.”

The news follows last week’s appointment of Edie Thome as president/CEO of the British Columbia-based Association for Mineral Exploration, which already had a female chairperson in Diane Nicolson. But in 2002, when the position of AME president was voluntary and the executive director was the staff lead position, Shari Gardiner served as president.

That province lost a prominent female industry spokesperson in April, however, when Karina Briño stepped down as B.C. Mining Association president/CEO to take on a mining role in her native Chile.

Earlier this month Saskatchewan mining companies pledged $1 million to the International Minerals Innovation Institute to help encourage greater employment of women and natives in the industry.