Company Reports > Northern Freegold Resources Ltd.

 
 

Report Date :  

 January 2013

Toll Free :  

 1.877.893.8757

Symbol :  

 NFR.TSX.V

Telephone :  

 604.893.8757

Contact :  

 Investor Relations

Facsimile :  

 604.893.8758

URL :  

 www.northernfreegold.com

eMail :  

  administration@northernfreegold.com

 

 

Few areas of the world have a mining history comparable to Canada's Yukon Territory thanks to the fabled Klondike Gold Rush which took place from the late 1890's into the early years of the Twentieth Century.  Tens of thousands of prospectors and treasure-hunters poured into the Territory thanks to the discovery of placer gold along a tributary of the Klondike River, itself a tributary of the mighty Yukon River.

 

One company active in seeking new mineral wealth in this fascinating and beautiful region is Vancouver-based Northern Freegold Resources Ltd.  During late July, in association with the Yukon Gold Mining Alliance, the company hosted a touring group of journalists, industry analysts and geologists at their Freegold Mountain Project located about 125 miles (200 Km) northwest of the capital city of Whitehorse.  I was fortunate to be a part of that tour.

 

Several factors have combined to raise the importance of mining to the general economy of the Yukon, thereby motivating both the Canadian federal government in Ottawa and Yukon's Territorial government in Whitehorse to favour the mining industry.  As a result, the Yukon consistently ranks in the top ten in the well-known Fraser Institute mining-related ratings of government jurisdictions around the world.

 

For those who are history buffs, the world-famous Klondike Gold Rush which transformed the Yukon began in August, 1896 with the discovery of visible placer gold on Rabbit Creek, later re-named "Bonanza Creek" and located close to where the Yukon River flows by Dawson City.  As word of the gold find spread, an enormous, legendary rush into the Yukon took place with most 'immigrants' gathering in Seattle, sailing to Skagway, Alaska and then climbing the difficult, sometimes terrifying White Pass, leading to the waters of the Yukon River and the interior of the Yukon.  As the Yukon's population and fame grew, the federal government granted the area separate Territorial status in 1898. 

 

Within a short time, more than 100,000 prospectors and 'wanna-be' merchants and entrepreneurs had poured into the Yukon and the population of Dawson City - the central community of the Klondike Gold Rush - had swelled from a scattered few to almost 30,000 people.

 

Placer mining exploration and operations soon spread into many areas of the Yukon, leaving behind a body of knowledge which has proven invaluable to this era's mining explorers and developers, based on the concept that if gold - one of nature's heaviest elements - had found its way down to the bottom of river valleys, it most likely had originated somewhere in the heights above.

 

The Freegold Mountain Project is located within an active exploration area in the Tintina Gold Belt which stretches across parts of Yukon and the State of Alaska.  Both the producing Fort Knox Mine, operated by Kinross Gold Corp. and the Pogo Mine, operated by Sumitomo Metal Mining are located in Alaska while more recent discoveries including Kaminak Gold Corporation and Atac Resources are in the Yukon.  Both jurisdictions host numerous multi-million ounce gold deposits.

 

Freegold Mountain has a lengthy exploration history dating back to the initial discovery of lode gold in 1930 by prospector P. F. Guder.  As word of Guder's discovery spread, a mini gold rush developed with prospectors eventually staking over 100 claims.  Following this initial burst of activity, only sporadic exploration work took place until the 1950's when the area was caught up in a new search for porphyry deposits.

 

Since the 1960's the Freegold Mountain Property had been owned and explored by a patchwork of individuals and companies and finally, in 2006, all the various claims were consolidated by Northern Freegold Resources into one cohesive project area covering about 200 square kilometers within the Whitehorse Mining District.  The company negotiated an Agreement in 2006 to acquire a 50% interest in the project and a later Agreement was negotiated in 2007 allowing the company to acquire a 100% interest, subject to 1-3% Net Smelter Return (NSR) provisions with previous owner ATAC Resources.

 

Freegold Mountain is underlain by Paleozoic or older metasedimentary and lesser metavolcanic rocks belonging to the Yukon-Tenana Terrane.  The basement metamorphic rocks are extensively intruded by Jurassic to Late Cretaceous igneous rocks of the Coast Plutonic Complex.  Mid-Cretaceous intrusive rocks include the Dawson Range Batholith, Casino granodiorite and Coffee Creek Granite.  The two main deposits at Freegold Mountain are named “Nucleus” and “Revenue.”

 

The company has conducted extensive exploration work programs since 2006 including several diamond and reverse circulation drill programs; Induced Polarization (IP) surveys; geochemical surveys; geological mapping; stream geochemical sampling and ground geophysics.  At various times, the company's work camps have hosted as many as 70 employees.

 

Northern Freegold released an Inferred Resource Estimate for the Revenue Zone in early 2012 which, at a cut-off grade of 0.3 grams per tonne (g/t) gold equivalent (AuEq), showed 158 million tonnes grading 027 g/t Au containing 1,345,000 oz gold; 2.49 g/t Ag containing 12,605,000 oz silver; 0.11% Cu containing 370,517,000 lbs copper and 0.03% Mo containing 103,560,000 lbs molybdenum with a total AuEq value of 0.83 g/t.

 

In January 2013 the company published the results of a Mineral Resource Estimate (NI 43-101 qualified) for the Nucleus Zone which contained both Indicated and Inferred resource data.  Highlights of the new estimate include a subcropping higher grade zone containing 25.9 million tonnes grading 1.02 g/t gold (851,603 oz gold) that has the potential to be exploited in the initial years of a mining operation.

 

Using a similar cut-off grade, Inferred resources showed 60,398,000 tonnes grading 0.41 g/t Au containing 801,000 oz gold; 1.5 g/t Ag containing 2,876,000 silver and 0.04% Cu containing 52,244,000 lbs copper for a total AuEq of 0.46 g/t.   

 

The company has a distinct advantage over many other exploratory deposits in the Yukon Territory in the form of infrastructure which includes existing roads into Freegold Mountain Project from the main Whitehorse - Dawson City highway as well as commercial power access just 30 km distant.  According to company President and CEO John Burges, other companies without such an established road and available power sources can face infrastructure costs of many hundreds of millions of dollars before they can advance their projects toward eventual production.

 

It is also worth noting that several other companies now hold interests in the general area of NFR’s projects including Dawson Gold, Teck Resources, Capstone Mining, Carmacks Copper, Ethos Gold, Kaminak Gold and, quite prominently, Western Copper and Gold’s Casino Project.  As a result, the potential for area infrastructure improvements would appear to be high and one plan which has received mention is for the Yukon government to rehabilitate the old Yukon and White Pass Railroad which would give access by rail from Whitehorse to port facilities by the Pacific Ocean in Alaska.

 

Burges also noted the company's long-range goals include proving up a world class deposit as both the Nucleus and Revenue Deposits remain open in all directions and at depth with the polymetallic Tinta Deposit also available for exploration and development.

 

At present, the Yukon is served by an international airport located in Whitehorse, plus several smaller facilities in communities like Dawson City or Mayo, as well as numerous private landing strips throughout the territory, many of them closely associated with mining activities.  Helicopter service is also available for quick and reliable access to mining camps.

 

Aside from all the other advantages noted earlier, mining within the Yukon is also attractive for two other reasons.  First, Canada and the Yukon provide a very stable background of government laws and regulations, unlike many nations in Africa, South America, Central America and elsewhere where courts are unreliable, taxation can be oppressive and where governments often demand a portion of a company's project before work can begin.

 

Second, relations between First Nations peoples and the Yukon government have been stable and agreements have been honoured.  During our tour, company Director Tim Termuende, P. Geol., also pointed out that the First Nations people in the Yukon tend to have lengthy periods of residence which means that as native personnel are trained, they are highly likely to be available for a lengthy period of time, thereby reducing or even eliminating frequent re-training, one of the difficulties faced by miners in other jurisdictions.  Also, due to its remote location, difficulties presented by environmental regulatory procedures have tended to be much more reasonable and, as a result, the permitting process in the Yukon has tended to be more reliable than in other locations.

 

Northern Freegold's management team is led by President and CEO John Burges; Chairman of the Board John Anderson; V.P. Exploration Paul Reynolds, P. Geol.; CFO Glen Diduck and Directors Tim Termuende, Greg Johnson, Founder Bill Harris and Marco Strub.

 

For further information, contact the company via e-mail at administration@northernfreegold.com or access the corporate website at www.northernfreegold.com.

 

 
Northern Freegold Resources Ltd.

Suite 900, 475 Howe Street
Vancouver BC, Canada
V6C 2B3

Toll Free :

  1.877.893.8757

Telephone :

  604.893.8757

Facsimile :

  604.893.8758
 
 
 

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