TerraX’s Campbell on track to pull off another major find in Yellowknife
TerraX Minerals Inc.’s (TSXV: TXR) renowned geologist Joe Campbell loves the most remote regions of Canada.
A few years ago, Campbell discovered the Meliadine project in a remote area of Nunavut that reached almost $700 million in a sale to Agnico Eagle Mines Limited. He’s also got a 250 million-ton nickel laterite deposit in Cuba under his belt.
With the proceeds from the Meliadine discovery, Campbell did what so many major mining companies are doing right now: head to a historical mining districts to reassess project economics at old mining sites, eschewing new, riskier areas of the world.
Barrick and Newmont have focused on projects in Nevada in recent years, even though gold was discovered in Eureka County in the 1870s. Both of these companies have suffered disastrous setbacks at more ambitious mining projects in Chile and Peru. Goldcorp’s exploration spend is heavily focused on Ontario and Chile, both mature mining districts.
Yellowknife, the remote capital of Canada’s North Western Territory, experienced a gold rush in the 1940s and was mined and explored up until the mid-1990s before going dormant. Campbell, through TerraX, has gone to take another look.
With 36 years of experience as a geologist, Campbell has spent much of his career with major mining companies, specifically Noranda and Western Mining Corporation.
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TerraX has a 772 square kilometer land package, which includes a 70km mineralized strike zone. The project is adjacent to the Con and Giant Mines, two of Canada’s historically highest grade gold mines. The project is broken up into Northbelt, Eastbelt and Southbelt. Most of TerraX’s exploration work has been confined to the Northbelt.
TerraX’s concessions covers the northern extension of the Giant (8.1 Moz. @ 16.0 g/t Au historical production) and Con (6.1 Moz.@ 16.1 g/t Au historical production) gold mines. The Northbelt property lies just north of the Giant Mine site, and is accessible by road from Yellowknife. Recent assay results show 43.7 g/t Au., 28.0 g/t Au, and 19.05 g/t Au on the Gull Lake Zone. These results are thought to show the continuation of the Giant mine.
The entire property is all within 8 km of the city of Yellowknife, close to vital infrastructure, including transportation, service providers, hydro-electric power and skilled tradespeople. Drill costs about $250 per meter, almost half of exploration companies working in remote exploration camps in the Northwest Territories.
Another positive factor is that Yellowknife and indeed Northwest Territories are backing the project. The city’s 20,000 people lived off mining and would welcome an operating mine back in action to continue making a living in a city where temperatures average −26 °C (−15 °F) in January. One of the explorers who was headed for the Klondike gold rush in Alaska found gold in Yellowknife in 1898, but a proper discovery was made in the 1930s, when the Con mine started.
The rate of gold discoveries in the world is declining, according to S&P Global Market Intelligence. More than $50 billion spent on gold exploration over the past decade has unearthed 215.5 million ounces of reserves in 41 discoveries. By contrast, companies discovered 1.72 billion ounces among 222 discoveries with a budget of $32.2 billion in the 18 years before that, according to S&P.
With a higher incentive price, that means mines that looked done 30 years ago might now be a good bet. Top geologists such as Campbell know their project economics inside out, and that is why they are much more likely to be seen in an old Canadian mining camp, rather than out in the steppes of Kazakhstan, or deep in the Amazon Jungle.
Matt Craze works with New York-based management consultancy 10EQS and is the founder of Spheric Research, a firm dedicated to global seafood industry research. Matt ... <Read more about Matt Craze>