Another major mining company has invested in Yukon’s White Gold district near Dawson City.
International gold producer Agnico Eagle Mines has purchased nearly 20 per cent of the shares of G4G Capital Corp., soon to be renamed White Gold Corp., for $14.5 million.
The Vancouver-based company has an option to acquire 12,300 claims across 21 properties in the Yukon from famed Yukon prospector Shawn Ryan, totalling about 30 per cent of the entire White Gold district.
The investment will help fund a three-year, $15-million exploration program to be conducted by Dawson-based GroundTruth Exploration.
“It brings a lot of credibility to the Yukon as a whole,” said Ryan, who will remain a technical advisor for White Gold Corp.
Agnico Eagle has properties in Finland, Mexico, the United States and Canada, including the Meadowbank mine in Nunavut.
Dale Coffin, the company’s corporate director of communications, said Agnico Eagle tends to invest in the early stages of development of a project.
He said this opportunity was appealing because of the major deposits that have already been found in the White Gold district — notably the Golden Saddle deposit, purchased by Kinross in 2010, and the Coffee deposit, acquired by mining giant Goldcorp this year.
“The best place to find a new deposit is next to an existing deposit,” Coffin said.
“The individuals involved are very experienced at finding deposits in that region and have a track record that few people can certainly point to and say they have similar track records.”
Ryan, who uncovered the White Gold district in 2009 and launched the largest staking spree the Yukon had seen since the Gold Rush, said the odds are good that there’s at least one more major deposit in these claims, and maybe two or three.
He said many of the claims had some preliminary exploration work done in 2011, so he knows which areas to target.
“Statistically, there’s never been a better probability of success than there is going forward in the next three years,” he said.
Ryan said he chose to option all the claims to a single company instead of breaking them up and selling to several different junior miners, knowing that many of them would come up empty.
“What I’m doing is kind of like going to the (Diamond Tooth) Gerties Hall and putting all my chips on the one spot,” he said. “We’re putting everything on red.”
Another reason for keeping all the claims in a single package, he said, is that GroundTruth Exploration’s technology can explore targets much more quickly than was previously possible.
GroundTruth specializes in low-impact exploration technology, including the use of rotary air blast drills that are smaller and more maneuverable than traditional diamond drills.
Ryan said GroundTruth’s three-year exploration plan includes 200 holes each season, when a standard junior miner might drill four or five with a diamond drill in a year.
Isaac Fage, president and co-founder of GroundTruth Exploration, said his company can drill for a third of the cost of diamond drilling. He’s also focused on developing on-site analysis of drilling cores.
“What we really take pride in is the idea of collecting real-time data and understanding what we’re doing,” he said.
GroundTruth has recently started using a camera with a fish-eye lens that gives an image of the inside of a drill hole. Fage said that image, paired with geochemical data collected on-site, allows the company to “react on a daily basis,” where other companies would have to wait weeks to get results back from a lab.
“What we’re hoping to change is really the public’s perception of how exploration could and should be taking place,” he said.
Ryan said GroundTruth’s methods allow it to explore an area almost too quickly for a junior miner to manage.
“What used to take us two field seasons and $500,000 is now taking us about a month for about $100,000,” he said.
GroundTruth’s three-year exploration program will begin in 2017. Fage said Agnico Eagle’s investment is good news for the Yukon’s mining industry.
“The biggest takeaway from this is that we’re really just scratching the surface and that the Yukon’s hugely underexplored.”
Contact Maura Forrest at email@example.com