Perspective: Expanding the universe of exploration capital

Perspective Issue Twenty Four - September 8, 2017

Yukon Territory Site Visits and Conference Take-Aways

By: Gary Baschuk, VP Senior Mining Analyst

We recently attended the Yukon Mining Investment Conference sponsored by the Yukon Government and the Yukon Mining Alliance. The five-day trip included a one-day, mini-conference held in Dawson City (home of the infamous Sourtoe Cocktail) and by six site visits. The visits provided an opportunity to see the diverse geology and mineral deposits the Yukon has to offer plus gave us an appreciation of access across the Yukon. Since the site visits, the Federal and Provincial Governments have committed just over $360 mln to improve road access to the Dawson Range in central Yukon and the Nahanni Range in the southeastern part of the Yukon. The proceeds are earmarked for upgrading 650 km of road and to build or replace numerous bridges, culverts and stream crossings. The improved accessibility into Yukon’s interior is positive news for the miners and prospectors and is expected to be especially helpful for the Coffee and Casino Projects.

Properties we visited included Wellgreen Platinum Ltd. (WG-TSX), Rockhaven Resources Ltd. (RK-TSX.V), Alexco Resources Corp. (AXR-TSX), Western Copper and Gold Corp. (WRN-TSX), Victoria Gold Corp. (VIT-TSX.V) and ATAC Resources Ltd. (ATC-TSX.V). Styles of mineralization at the properties were vastly different and included Carlin-style gold, vein silver/lead/zinc, copper-gold porphyry and platinum/palladium/nickel/copper massive sulphide deposits.

The Yukon Government is extremely supportive of the mining industry, both placer and hard rock. To assist individuals and companies with risk capital for exploration, the Yukon Government has created the Yukon Mineral Exploration Program (YMEP), similar to a program created in the Northwest Territories (discussed in the previous Perspective).

Access around the Yukon was pretty good for a Territory with only 38,100 persons, especially since over 29,600 live in the Whitehorse Area. The Yukon has well laid out highways with the Klondike and Dempster Highways traversing the north-south extent and the Robert Campbell and Top of the World Highways traversing east-west. The Alaska Highway or #1 crosses the extreme southwest. Black-top roads connect the major communities with the highway system. Access into the interior can be difficult and gravel roads have limited extent – generally to placer mining operations and a few exploration sites. During our visit, we frequently used fixed wing and/or helicopters to access the projects.

Yukon Geological Overview

The Yukon lies in the northern part of the Cordilleran which runs from Chile up the west coasts of South, Central and North America. The prolific belt is host to some of the world’s largest copper, gold and silver deposits.

Figure 1. Yukon Geology Map

 Source: Yukon Energy, Mines and Resources

The Yukon can be divided into five geological areas separated by major faults.

The Tintina Fault, with approximately 430 km of dextral movement, is the most pronounced structure in the Territory separating the Cordilleran Intermontane terranes (mid- to late-Paleozoic marginal oceanic basin rocks and a younger series of mid-Paleozoic to early-Mesozoic island arc complex rocks) in the southwest from the Ancestral North America sequences (dominantly platform sedimentary rocks interlaced with a few volcanic events, deposited on the continental margin of ancient Laurentia – the core of which is the Canadian Shield) in the northeast. In the south-central part of the Yukon, a sliver of the Tintina fault shuffles and repeats the stratigraphy. To the southwest, the Denali Fault separates the Intermontane from the Insular terrane (Cambrian to mid-Jurassic sequence of back-arc sedimentary and volcaniclastic rocks combined with thick volcanic flows and deep-water sediments). Ultramafic intrusions (gabbro, pyroxenite, dunite) are associated with the basaltic eruptions and are host to the Ni-Cu-PGE deposits in the southwest of the Yukon.  In the northwestern part of the Territory, the Porcupine Fault juxtaposes the Arctic Alaska terrane (Neoproterozoic and Paleozoic platform and basin sediments with localized submarine volcanics) with the Ancestral North American rocks. In the extreme southwest, the Outboard terrane (Cretaceous flysch and melange sequences (sediments created from the erosion of the Canadian Cordillera) and Paleogene igneous and basaltic rocks) are separated from the Insular terranes by the Border Ranges Fault.

Intrusive activity: Early Cretaceous intrusives (145-135 Ma) are restricted to the Insular terrane while mid-Cretaceous intrusives occur in a series of northwest-trending plutonic belts. In the southwest, south of the Denali Fault, the Kluane Ranges suite (118-108 Ma) occur. These ultramafic suites host Cu-Ni-PGE mineralization.

Northeast of the Denali Fault, the 112-99 Ma old Dawson Range and Whitehorse suites intrude the Intermontane rocks. These plutons are reported to have generated the copper-gold-silver skarns of the Whitehorse Copper Belt and may be responsible for the gold mineralization located in the Dawson Range. The Cassiar suite (110-100 Ma), and northeast offsets of the Tintina Fault equivalents, the Hyland and Anvil suites (110-96 Ma) are associated with tungsten +/- molybdenum skarns and veins as well as distal silver-lead-zinc veins. Further north-easterly, the Tungsten, Mayo and Tombstone suites are present east of the Tintina Fault. The Tungsten suite of intrusives (97-94 Ma) are associated with the scheelite skarn deposits at Mactung and Cantung. The Mayo suite (95-92 Ma) are believed to be associated with intrusive-related gold mineralization at Dublin Gulch (owned by Victoria Gold). The Tombstone suite (92-90 Ma) are typically more alkalic with a dominance of monzonite and syenite. Uranium, thorium and rare earth-elements plus gold at the Brewery Creek Deposit are associated with the Tombstone suite.

Late Cretaceous intrusives are reportedly widespread between the Denali and Tintina Faults and include small plutons of the Prospector Mountain suite (76-72 Ma). Mineralization associated with this suite include copper-gold porphyry mineralization at Casino (Western Copper and Gold Corp.) and epithermal mineralization. To the northeast of the Tintina Fault, the McQuesten plutonic suite (67-63 Ma) is present with associated silver-tin mineralization.

The youngest intrusive suite is the Ruby Range (64-56 Ma) and is comprised mainly of granodiorite to tonalite. These are reported to have the potential to host copper-molybdenum porphyry and epithermal mineralization.

For a detailed overview of the geology, please refer to “Overview of Yukon Geology” by Steve Israel, Maurice Colpron, Charlie Roots and Tiffany Fraser available from Yukon Energy, Mines and Resources website.

With numerous regional-scale and probable deep-seated faults that create crustal weakness enabling the northeast alignment of intrusives, we believe the Yukon has excellent potential for hosting more large deposits. To date, multi-million-ounce gold deposits have been discovered at Brewery Creek, Dublin Gulch, Coffee and Casino, plus multi-million-ounce silver deposits at Alexco’s Keno Hill area. Mineralization styles are diverse and widespread across the various terranes. Figure 2 illustrates the location of Mining and Exploration Projects in 2016 and illustrates the spatial association of deposits to infrastructure.

Figure 2. Yukon Mining and Exploration Projects, 2016

Source: Yukon Energy, Mines and Resources

PearTree Spotlight

Agnico Eagle’s Meadowbank Mine

PearTree is proud to feature the Agnico Eagle METC Meadowbank case study video. The Meadowbank open-pit gold mine in the Kivalliq region of Nunavut – approximately 300 km west of Hudson Bay and 110 km by road north of Baker Lake – is Agnico Eagle’s first Low Arctic mine. This Canadian success story originated as a result of METC / flow through financing.

To learn more about the Meadowbank mine, click here.

Equity Research

By Gary Baschuk, VP Senior Mining Analyst

Alexco Resource Corp. (AXR-TSX, AXU-NYSE)

Re-Kick-Starting the Legendary Keno Hill Silver Camp

Alexco controls most of the past producing Keno Hill Silver District in Central Yukon. During our site visit we toured some of the past producers and had the opportunity to view the Flame and Moth portal situated directly beside the 400 tpd mill.

Key take-aways from the site visit include:

  • Large Indicated Resource of over 58 mln oz silver providing leverage to rising silver prices
  • Ability to quickly recommence operations with 400 t/d crushing and flotation plant with ability to expand to 1,000 tpd
  • Experienced personnel
  • Large Inferred Resource to augment mineral inventory
  • More favourable, renegotiated silver purchase agreement with Wheaton Precious Metals Corp. (WPM-TSX)
  • Large land position in a historical, significant silver producing region providing areas for new discovery
  • Numerous working areas could provide more tonnage to substantiate a larger mill

The Keno Hill District reportedly produced over 214 mln ounces of silver from 35 mines over 77 years (1913 to 1989) at an average grade of 44 oz/ton (1,508 g/t) silver, 6.6% lead and 4.1% zinc. Alexco has amassed an Indicated Resource of over 58.3 mln oz silver plus an Inferred Resource of almost 18 mln oz silver from five sites at an average grade of 500 g/t (14.6 oz/t) and 408 g/t (11.9 oz/t), respectively.

Figure 1. Historic Photos from the Keno Hill District

Source: Alexco Resource Corp.

Alexco purchased the property in an auction from bankrupt United Keno Hill Mines Ltd. in 2006. With over 100 years of past mining activity, substantial liabilities exist, although the Federal Government has indemnified Alexco from historical environmental liabilities. If a new mine is brought into production, Alexco would be responsible for historical surface disturbances (roads, tailings, etc) and water related liabilities within a designated area.  As part of the agreement with the Federal Government, Alexco, Territorial, Federal and First Nations Governments are responsible for developing a district-wide closure plan. Alexco Resource Corp, also owns Alexco Environmental Group (AEG), a company specializing in mining environmental issues and remediation. Besides work in the Keno Hill area (primarily remediation of high Zn content in water), AEG has worked on projects in Colorado, Peru, NWT, S. Carolina, and New Mexico and specializes in the treatment of contaminated water and soils at large industrial and mining sites in North America.  In 2016, AEG recorded revenues of $11.4 mln. Alexco management indicated that this company may be privatized and severed from Alexco Resources.

The Keno Hill Silver Mining District is located in central Yukon approximately a 30-minute drive from the Village of Mayo, population of 450. Alexco’s 233 sq km property encompasses over 10 past producers plus five active projects that were part of a March 2017 PEA. The five projects, Bermingham, Flame and Moth, Onek, Bellekeno and Lucky Queen host Indicated Resources of over 3.6 mln tonnes grading 500 g/t silver, 2.0% lead, 5.6% zinc and 0.30 g/t gold.

Figure 2. Keno Hill District Silver Mineralization – Keno Hill Quartzite (yellow) hosts mineralization

Source: Alexco Resource Corp.

Mineralization is typical polymetallic silver-lead-zinc vein style hosted in quartzite. The region is structurally complex with multiple stages of folding and faulting resulting in brittle fracturing developing in the competent quartzite. The veins are hosted in a series of north-east trending pre- and syn- silver mineralization vein-faults. Continued movement on the faults has off-set the veins generally in a sinistral normal movement. This type of polymetallic vein is commonly zoned based upon chemical precipitation conditions. In the Keno Hill region, disruptive vein zonation is noted and indicative of multiple pulses of mineralization and reactivation along feeder conduits.  The occurrence of multiple mineralization stages is positive for finding more silver mineralization at depth, as generally, the silver precipitates out later in the upper levels of the hydrothermal system.

Figure 3. High-grade Polymetallic Vein illustrating multiple stages of mineralization

Source: Alexco Resource Corp.

Alexco’s most advanced projects are Flame and Moth and Bermingham. Flame and Moth hosts 46% of the Indicated Silver Resource on the property and Bermingham hosts 30%.

Flame and Moth hosts an Indicated Resource of 1.679 mln tonnes grading 498 g/t silver, 1.85% lead, 5.33% zinc and 0.42 g/t gold plus and Inferred Resource of 365,200 tonnes grading 356 g/t silver, 0.47% lead, 4.25% zinc and 0.26 g/t gold. At depth, minor copper, tin and tungsten have been noted suggesting the mineralization was deposited at higher temperatures than surrounding deposits. The Flame Vein averages ~4m in width and consists of multiphase quartz and siderite (an iron carbonate mineral). It has been traced for over 1,000m along strike and to ~450m at depth.

In 2016, the portal was constructed and in 2018 Alexco plans to drive a 965m decline to drill the deposit at 5m centres at an estimated cost of $10.6 mln. Final Permits are required for additional underground work.

Figure 4. Flame and Moth Portal

Source: PearTree Securities Inc.

Figure 5. Flame and Moth Planned Development

Source: Alexco Resource Corp.

Bermingham also comprises a large percentage of the Indicated Resources of the Keno Hill Property with a higher-grade at 628 g/t silver. Bermingham is near the past producing Hector-Calumet Mine which historically produced 96 M oz of silver. 2017/2018 Plans for Bermingham include a 650m exploration decline expected to cost $5.9 mln plus underground reserve definition drilling. Permits remain to be acquired for the underground work.

Figure 6. Bermingham Proposed Decline and production

Source: Alexco Resource Corp.

The 400 tpd grinding and flotation plant currently on site, according to the company, could be expanded to 1,000 tpd with additional grinding equipment at a capital cost of $5-$10 mln. The plant is on the Yukon power grid (~ 12 cents/kwh) and concentrate would be shipped in 5,400 tonne loads to Skagway, Alaska, then to Seattle for final shipment to smelters.

Mining by Alexco at Bellekeno was suspended in 2013 with declining silver prices. From 2013 to 2016, the company focussed on exploration at Flame and Moth and Bermingham. As part a restructuring process, Alexco and Wheaton Precious Metals (previously Silver Wheaton) renegotiated the silver stream agreement. In Q4/2008 an agreement was reached whereby Silver Wheaton was to pay US$50 mln to Alexco for development and construction of the Bellekeno Mine and Alexco agreed to deliver 25% of the silver production to Silver Wheaton at US$3.90/oz. The new agreement, completed in Q1/2017 contains conditions based upon silver price and mined silver grade.

Floor Grade = 600 g/t Ag

Ceiling Grade = 1, 400 g/t Ag

Floor Price = US$13/oz Ag

Ceiling Price = US$25/oz Ag

Deemed Shipment Head Grade = calculated monthly silver head grade from the mill

Deemed Shipment Silver Price = Average monthly silver price

Market Price = Spot silver price on day of sale


Alexco has defined a large, high-grade silver resource in a historic camp and provides a good leverage position to rising silver prices. A 400 tpd mill, readily expandable, and flotation plant is on-site and underground planning is ongoing. Re-evaluation of past data has resulted in a regional database that can be used for targeting new discoveries and extending old operations. We believe, with the necessary mining permits, Alexco could soon be back in production. The company, as of June 30, 2017, had an unrestricted cash and cash equivalent position of approximately $26.5 mln.


ATAC Resources Ltd. (ATC-TSX.V)

Osiris, Orion and Rau all Moving Along

ATAC’s Rackla Property hosts the only known Carlin-style gold deposit in Canada. Since the initial discovery in 2010, the company has discovered at least 15 mineralized zones – four at Osiris and 11 within the Anubis Cluster at Orion. Earlier in the year, Barrick Gold Corp. (ABX-TSX) and ATAC reached an agreement including an $8.3 mln cash infusion resulting in Barrick owning a 19.9% interest in the company. Barrick may also spend an additional $55 mln, in stages, for a 70% interest in the Orion Project (more details below).

Key Attributes

  • Canada’s only Carlin-style mineralized system
  • High-grade intercepts over wide intervals
  • Exemplary Exploration Potential on the Large Property
  • Support by Barrick Gold – Financial and Technical
  • Experienced Management Team
  • Additional Potential at Tiger Oxide Deposit with Carbonate Replacement Style Mineralization in western portion of the Property

Near-Term Catalysts

  • Continued Drill Results from Conrad and Area
  • Approval of Permit for Tote Road Construction to access Tiger Deposit
  • Exploration Results from numerous targets near Tiger
  • Exploration results from Barrick on the Orion Project

Figure 1. Rackla Gold Property Map

Source: ATAC Resources Ltd.

ATAC is in the midst of a $10 mln exploration program and is focussed on the100%-owned Conrad Zone within the Osiris Cluster.  At the time of our visit, the company had two diamond drill rigs at Conrad and one at the Rau Project. ATAC expects to drill between 10,000 and 13,000m in 2017 which should provide steady news flow throughout the year. Recent drilling at Conrad yielded positive results over wide intervals including a new gold discovery associated with the 650 Fault:


  • 4.91 g/t gold over 12.20m, and
  • 5.97 g/t gold over 12.19m


  • 3.65 g/t gold over 36.58m including 5.51 g/t gold over 12.89m, and
  • 3.35 g/t gold over 67.06m including
  • 7.02 g/t gold over 9.81m and 7.25 g/t gold over 15.14m


  • 3.49 g/t gold over 33.53m

OS-17-236:  Upper Zone Intercepts:

  • 4.37 g/t gold over 27.43m including 10.66 g/t gold over 6.97m, and
  • 3.52 g/t gold over 34.57m, and
  • 8.59 g/t gold over 16.76m including 17.24 g/t gold over 7.90m

650 Fault Intercepts

  • 3.78 g/t gold over 42.67m including 8.16 g/t gold over 6.77m

OS-17-238:  650 Fault Intercepts:

  • 4.96 g/t gold over 7.62m, and
  • 20.78 g/t gold over 12.50m including
  • 35.60 g/t gold over 3.35m, and
  • 7.15 g/t gold over 10.41m including 11.83 g/t gold 5.08m

Figure 2. Carlin -style gold mineralization with realgar (reddish) and orpiment (yellow) hosted in brecciated limestone.

Source. PearTree Securities Inc.

As ATAC improves the geological understanding of mineralizing controls (intersecting faults that acted as conduits for gold mineralizing fluids with porous calcareous stratigraphy), we expect the deposits to grow substantially. The areal extent of Carlin-style gold mineralization at Rackla covers an immense area and we believe, is indicative of a very large hydrothermal system.

Figure 3. ATAC’s Rackla Camp site

Source: PearTree Securities Inc.

In addition to exploration on the Osiris Project, ATAC has one drill at Rau testing the Tiger East area where surface sampling returned values between 1.15 g/t and 18.30 g/t gold. Rau hosts the Tiger Deposit, a Carbonate Replacement type system and the most advanced deposit on the property. Tiger has a NI 43-101 Measured and Indicated Resource (oxide and sulphide) of 5.68 mln tonnes grading 2.66 g/t gold and 3.56 g/t silver containing 485,700 oz gold and 649,900 oz silver plus an Inferred Resource of 3.23 mln tonnes grading 1.81 g/t gold and 0.92 g/t silver containing 188,500 oz gold and 95,600 oz silver (0.50 g/t oxide gold cut-off and 1.00 g/t sulphide gold cut-off). A Preliminary Economic Assessment was completed in 2016 resulting in positive results with a 28.2% IRR (post-tax) yielding 302,307 oz gold with a payback of less than 2 yrs. Rau may act as a stepping-stone toward future development for the Carlin-style systems further east.

Barrick is actively exploring the Orion Project and is wrapping-up detailed mapping and prospecting with a focus on stratigraphic classification and structural characterization. As part of the program, Barrick is using rotary-air-blast (RAB) drills to sample the hidden bedrock. In addition, Barrick plans on conducting a ground-based gravity survey.

Figure 4. Access to the Rackla Property is currently by fixed wing and then helicopter to camp.

Source: PearTree Securities Inc.

Access to the property is currently via fixed wing to the Osiris airstrip and then helicopter to camp. ATAC is in the midst of regulatory approval for construction of a 65-km tote road from Keno City to the Rau Project site. The company indicated that approval was expected within the next six months. This is will provide the initial step to eventual road access for the Orion and Osiris Projects.

The Barrick/ATAC Transaction:

  1. Barrick to spend $35 mln to acquire a 60% interest of the Orion Project
    • $10 mln must be spent within the first 3 years
  2. Barrick to spend an additional $20 mln in exploration to acquire and additional 10% interest in Orion.
  3. One or more of Barrick’s senior exploration members to be appointed to Orion exploration team
  4. After the earn-in, if either party’s joint venture interest drops to 10% or less:
    • their interest reverts to a sliding scale net smelter return (NSR) royalty on gold ranging from 1-3% with no buy-out provision.
    • Silver will be subject to a fixed 2% NSR and all other commodities will be subject to a 1% fixed NSR – neither with a buy-out.

We believe Barrick, experts in Carlin-style mineralizing systems, recognized the potential of this area and stepped-up-to-the-plate early, and have now placed a firm grasp on the company. In addition to Barrick’s 19.9% interest, Tocqueville Asset Management holds 8.4% and Strategic Metals (SMD-TSX.V) owns 7.3%.

ATAC is well funded with approximately $18 mln in its treasury.


Victoria Gold Corp. (VIT-TSX.V)

Ready to Break Rock and Roll (or Grind)

During our site visit to Victoria Gold’s fully permitted, 100%-owned Eagle Gold Deposit on the Dublin Gulch claim block, we had the opportunity to appreciate the scale of the project, the potential upside for new discoveries and the commitment of the people on the ground.

The Dublin Gulch Property is readily accessible only 85 km by road from Mayo and is fully permitted to commence construction as a conventional truck and shovel, open-pit, heap-leach operation. Victoria has ordered the mining fleet of CAT 150-ton trucks and 29 cu yd hydraulic shovels and is expected to order the ADR plant and crushers in the near future. A positive feasibility was completed in 2016 defining Reserves of 123 mln t of ore grading 0.67 g/t gold (diluted) for a total of 2.66 mln ozs. Total Capex for the project is estimated at US$288 mln with production averaging 185,000 oz/yr over 10 yrs at Operating Costs of US$538/oz and low All-in-Sustaining Costs (AISC) of US$639/oz (assuming a gold price of US$1250/oz) resulting in an IRR of 29.5% (post-tax). BNP Paribas and Victoria have signed a US$220 mln commitment letter for the debt financing needed for the construction. Construction is expected to commence in Q1/2018 with the first gold pour in Q2/2019. The low stripping ratio and good metallurgical recoveries from simple crushing and heap leaching keep the project costs low.

The Eagle Gold Deposit is hosted in a 93 mln year-old intrusive (Tombstone suite) similar to that of Kinross Gold’s (K-TSX) Fort Knox Mine in Alaska. Style, age and host rock are similar to Fort Knox which produced almost 410,000 oz in 2016 through heap leaching and milling at an average grade of 0.69 g/t gold. The Mine generated operating earnings of US$110 mln for Kinross in 2016. Both are located in the Tintina Gold Belt.

Figure 1. Tintina Gold Belt Location

Source: Victoria Gold Corp.

Figure 2. Site of proposed pit – Eagle Deposit located on the hillside supporting a low 0.95:1 strip ratio

Source: PearTree Securities Inc.

The Victoria Gold property, encompassing approximately 635 sq km in total, still has much to be explored. The company recently increased the 2017 exploration budget from $6.2 mln to $12.5 mln. Spending is earmarked on a number of targets along the 13+ km Potato Hill Trend and includes step-out and definition drilling on shallow mineralization at the Olive-Shamrock area adjacent to the designed pit.

Figure 3.  Claim Block Location Map illustrating Deposit Sites and Potato Hills Trend

Source: Victoria Gold Corp.

The additional targets, generally focussed on the sheared contact of intrusives with the sediments, and testing Keno Hill-style silver mineralization, include:

East Potato Hills (Bluto target) – never-drilled gold and arsenic intrusion-related anomaly approximately 2 km X 1 km,

Nugget – never-drilled Eagle-look-alike target with positive geochemical and trench anomalies,

Popeye – under-explored, intrusive related mineralization, similar to the Eagle Deposit, located only 1 km west of Olive-Shamrock.

Falcon – intrusion related gold target located to the west on the VBW claims,

Eagle West – 500m west of the Eagle Gold deposit with under-explored granodiorite with similar characteristics as the Eagle Deposit,

Rex-Peso – past producing, high-grade silver zone with strong arsenic and antimony geochemical results that has not been tested for gold, and

Lynx Dome – past producing silver deposit untested for the gold potential.

2017 Exploration Drill Results:

Substantial drilling has been completed to date and Victoria has released results from a number of targets that yield positive results worthy of follow-up work.

Drilling at the Popeye target returned encouraging results including:


  • 0.53 g/t gold over 5.3m from 45.0m downhole, and


  • 46.63 g/t gold over 4.3m from 22.6m downhole, including
  • 131.00 g/t gold over 1.5m

The mineralization at Popeye consists of sericite-carbonate and sericite-chlorite altered granodiorite with quartz-molybdenum veins.

Eagle West drilling also returned encouraging results including:


  • 0.99 g/t gold over 31.5m starting at 56.4m downhole,


  • 0.47 g/t gold over 17.9m starting at 88.4m downhole,


  • 0.76 g/t gold over 16.3m starting at 24.1m downhole, and
  • 1.43 g/t gold over 13.3m starting at 70.6m downhole,


  • 0.56 g/t gold over 59.4m commencing at 9.1m downhole, and including
  • 25.00 g/t gold over 1.1m,


  • 0.43 g/t gold over 43.8m starting at 50.1m downhole,


  • 0.46 g/t gold over 73.9m starting at 3.8m,


  • 0.77 g/t gold over 31.5m starting at 7.6m

Mineralization is hosted in sets of sheeted veins with pervasive sericite alteration and massive sulphide mineralization.

Recent Olive-Shamrock drill results (some subsequent to the site visit) include highlights of:


  • 0.60 g/t gold over 73.88m starting at 93.76m downhole,


  •  0.80 g/t gold over 82.3m starting at 4.57m, downhole,


  • 0.61 g/t gold over 35.3m starting at 4.2m downhole including
  • 1.94 g/t gold over 10.0m,


  • 1.04 g/t gold over 39.6m starting at 32m downhole including
  • 1.36 g/t gold over 24.4m,


  • 2.24 g/t gold over 16.5m starting at 22.9m downhole including
  • 21.50 g/t gold over 1.5m,


  • 2.78 g/t gold over 22.5m starting at 68.0m downhole including
  • 15.7 g/t gold over 3.4m

The areas drilled to date in 2017 have returned encouraging results and are proximal to the proposed open pit. These deposits are expected to be complimentary to the project, although much additional drilling is required to fully define the deposits. In addition, more remote targets, but still well within trucking distance, are expected to be drill tested later in 2017.

Figure 4: Victoria Gold’s 100-person, all-season camp situated in the valley with past placer operations in the background. The Eagle Gold Project is off to the far right and the Falcon Exploration play is to the left.

Source: PearTree Securities Inc.

Figure 5: Olive Zone Discovery Trench

Source. PearTree Securities Inc.

Victoria Gold has already defined a mineable, multi-million-ounce gold deposit and has excellent opportunity to expand the size at depth and in a number of nearby zones. The size and advanced state of the project has attracted high profile investors including:

  • Sun Valley Gold LLC – 17%
  • Electrum Group LLC – 14%
  • Kinross Gold Corp. – 11%


Victoria Gold has defined a multi-million-ounce gold deposit and is moving forward to construction. All construction permits are in place and a financing agreement has been signed. The project, with a low strip ratio, conventional open pit, truck and shovel fleet, and heap leach operation with ADR gold recovery is expected to be the largest mine in Yukon history. In addition, encouraging exploration results have been received illustrating potential upside in close proximity to the planned pit.


Wellgreen Platinum Ltd. (WG-TSX)

Room to Grow right off the Highway!

Wellgreen Platinum hosts a large Ni-PGM-Cu deposit located directly off the Yukon/Alaska Highway. The site visit included a presentation of the deposit setting, a visit to the portal utilized by previous operators (Hudbay Minerals Inc., HBM-TSX) and a visit to the deposit site. Although a rainy and cool day, we were able to grasp the magnitude of the deposit from the roadway looking up at the mountain.

Key Criteria

  • Large, multi-element, open-pit deposit
  • Low strip ratio – deposit lies on the side of the mountain
  • Proven management team
  • Potential for resource expansion
  • Adjacent to major highway for easy access and transporting equipment and concentrate
  • Strong supporters – Electrum (27%), Resource Capital Funds (9%), Drake Capital, Solway Investment Group (7%), Insiders (3%)


  • Infill drilling Results
  • District Exploration Results
  • Continued refinement of model and mine plan
  • Further studies on separating Ni and Cu zones to optimize recoveries
  • Leverage to Continued Commodity Price Improvements


Figure 1. View of Wellgreen’s Ni-PGM-Cu Deposit situated below the drill pads and roads.

Source: Wellgreen Platinum Ltd.

Large, Multi-Element Resource

In mid-year, Wellgreen Platinum updated the PEA from the previous 2014 version with the incorporation of 74 more drill holes, better defined mineralization domains, updated metallurgical results, updated operating and capital costs plus refinement of site facility locations. The results were mixed – M&I tonnage was up 10% with similar grades but Inferred Resources tonnage was down approximately 86% – although nickel grades increased 20% while copper grades decreased approximately 14%. The updated resource provides improved confidence with all of the data and establishes a new starting point for development.

Figure 2. June 2017 Updated Resource Estimate

Source: Wellgreen Platinum Ltd.

Wellgreen has commenced the 2017 drilling with two rigs and has completed approximately 1,400m of a planned 3,600m program. Drilling is for two purposes – 1) Seven infill holes (1,650m) to improve the Resource quality from Inferred to Measured and Indicated, and 2) Seven, infill metallurgical, NQ-sized core holes (1,950m) aimed at providing test samples to further characterize the mineralization and optimize recoveries for separate nickel and copper concentrates.

Figure 3. 2017 Drill hole Location Map

Source: Wellgreen Platinum Ltd.

Property Geology

The Wellgreen deposit is hosted within the Quill Creek Complex, a mafic-ultramafic intrusion occurring within the Kluane Ultramafic Belt of the Wrangellia Terrane. The Quill Creek assemblage can be traced for 20 km while the main mass of ultramafic intrusive is located on the Wellgreen Property comprised of the Wellgreen and the Quill intrusives.  To the northwest, a similar but smaller intrusive, the Arch and to the southeast, the Burwash intrusive, are also believed to be part of the Quill Creek Complex. The Quill Creek Complex is a layered intrusive which transitions from peridotite to clinopyroxenite to gabbro. Sulphide mineralization mimics the transition increasing concentration toward the sedimentary contact at the base.

Exploration Potential

To date, work has focussed on the Wellgreen Intrusion due to the presence of outcropping ultramafics, while minimal work has been conducted on the Arch, Quill and Burwash intrusives.  The Quill intrusive, believed to be deeper, is expected to be part of the 2017 exploration program.

Figure 4. Intrusive location in the Quill Creek Complex

Source: Wellgreen Platinum Ltd.

Figure 5. Geophysical signature of the Wellgreen Deposit illustrating similarities to the Quill and Burwash targets.

Source: Wellgreen Platinum Ltd.

Historic Operations

Hudson Yukon Mining, now HudBay Minerals Inc., commenced mining the deposit in 1972 but closed operations after one-year due to falling metal prices and reportedly discontinuity of the massive sulphide lenses. Production totaled 171,652 tonnes grading 2.23% nickel, 1.39% copper, 1.3 g/t platinum, 0.92 g/t palladium, 0.17 g/t gold, 0.40 g/t rhodium, 0.42 g/t ruthenium, 0.25 g/t iridium, 0.20 g/t osmium, and 0.20 g/t rhenium. The ore was processed on site and the concentrate shipped to Sumitomo in Japan. The adit is accessible and provides access to mineralization for studies.

Figure 6. Hudson Yukon Mining Adit.

Source: PearTree Securities Inc.


As of May 11, Wellgreen reported C$7.4 mln in cash and short-term investments. Since then, the company has completed a private placement with gross proceeds of C$9,531,215. We expect the Company to be well financed to complete the proposed work for 2017 and into 2018.

Management and Directors

The Wellgreen Management Team is well experienced with developing large-scale, open-pit, conventional truck and shovel operations having recently been involved with Romarco Minerals Inc.’s Haile Mine which was sold to OceanaGold Corp. (OGC-TSX) for approximately $856 mln in 2015.

Diane Garrett, Dir, President and CEO held a similar position at Romarco where she led the Haile Gold team from discovery to construction. In the past, Diane was an analyst and portfolio manager with US Global Investors.

Heather White, COO recently joined the Wellgreen team. Over her 20+ yr. career, Ms. White served in senior operating and executive roles with NOVAGOLD Resources (NG-TSX) and Vale Canada (VALE-NYSE), and most recently operated White Mining Consulting Inc.

Joe Romagnolo, CFO previously worked with OceanaGold, Romarco and Centenario Copper.

Graeme Jennings, VP Corporate Development and Investor Relations is a former Metals analyst.

James Barry, Chief Geologist also hails from the Haile operations.

The Directors are professionals with varied experience in Finance, Legal, Operations and Human Resources.

Myron Manternach is Chairman and was previously with JP Morgan Chase and Ambac Assurance Corp.

Mark Fields is a PGeo and worked with Rio Tinto (RIO-LSE).

Gillyeard (Gil) Leathley was previously with NovaGold and Homestake Mining.

Mike Sylvestre was previously with Kinross Gold (K-TSX) and Vale/Inco.

Wayne Kirk is former General Counsel, Homestake Mining Company and Gabriel Resources.

Michelle S. Darling was previously with Prudential Financial, CIBC (Cm-TSX) and Osisko Mining Co. (OSK-TSX)


White Gold Corp. (WGO-TSX.V)

Leadership by a Pioneering Team of Discovery

White Gold controls a large, under-explored land package in the White Gold District of the Yukon, part of the Tintina Gold Belt. Although we did not get the opportunity to visit the Company’s properties, we believe White Gold has a premier property position and an experienced team with District knowledge to advance the projects.

Key Criteria

  • Large, under-explored, land package in developing White Gold District near multi-million-ounce hydrothermal gold and porphyry copper-gold deposits
  • Pioneering team of explorers and developers lead by Shawn Ryan and Robert Carpenter
  • Numerous early-stage targets with encouraging results
  • Strategic Partners – Kinross Gold Corp (K-TSX) and Agnico Eagle Mines Ltd (AEM-TSX) each with 19.9% interest
  • Skin in the Game – Management and Insiders own 28.5%
  • Proprietary Exploration Techniques

Near-Term Catalysts

  • Drill Results – White Gold plans to drill 200 holes (~20,000m of drilling)
  • Exploration Results – Work is planned on 29 properties with RAB drilling, soil sampling, geophysics, geological mapping and sampling
  • Diamond Drill Results expected from newly acquired Golden Saddle Deposit

Figure 1. White Gold District Non-Glaciated, Rolling Terrain

Source: White Gold Corp.


White Gold holds over 19,438 quartz claims in 30 properties controlling approximately 40% of the mining claims in the White Gold District. The work on the properties range from grassroots to advanced stage with the White Gold/Golden Saddle Property, recently acquired from Kinross Gold, being the most advanced. The Company has budgeted over $7.1mln for exploration in 2017 plus a minimum of another $6.4mln in 2018 and $4.6mln in 2019. The 2018/19 budgets do not include estimates for the more advanced White Gold/Golden Saddle Property or for regional work.

Figure 2. White Gold District Property Map illustrating Major Discoveries and Location of White Gold’s Properties.

Source: White Gold Corp.

The White Gold Property has a Historic Resource of approximately 1 mln ounces gold based upon NI 43-101 estimates from Underworld Resources and Kinross. Gold mineralization is structurally controlled associated with disseminated and fracture controlled pyrite, quartz-flooded breccia bodies and quartz veins with sericite/illite/ankerite alteration. The structural corridor strikes northeast and dips moderately to the northwest. Mineralization has been traced approximately 500m along strike and to over 400m at depth. The deposit remains open in all directions. The Company plans on spending $1 mln on exploration at White Gold in 2017.

Figure 3. Location of White Gold Properties.

Source: White Gold Corp.

Sixty Mile Claims

Large claim block (2,759 claims covering 55,941 ha) with historical placer gold production of over 500,000 oz gold. The property has three strong geochemical anomalies.

  • Cali – rock grab samples of up to 1.41 g/t gold and soil geochem up to 284 ppb with coincident anomalous Ag, As, Bi, Cu and Pb.
  • Nine – historic rock grab samples of up to 4.23 g/t gold and soils up to 525.7 ppb gold with coincident anomalous Ag, Bi, Pb and Te.
  • Hart/Chant – gold in soils up to 645 ppb with coincident Ag, Bi and Te.

The Company plans to spend $1.1 mln in exploration in 2017.

White-Stewart Claims

The 142,029-ha property is proximal to the Coffee Deposit (owned by Goldcorp Inc., G-TSX) and the White Gold Property previously held by Kinross. The White-Stewart Claims include the Black Hills and Brew properties. Gold mineralization at Black Hills is associated with quartz, sericite, quartz breccia and vein zones along a regional fault zone. The Brew Property has three gold-in-soil anomalies over a 4.5 km stretch. Geochem gold values are up to 874 ppb and associated with molybdenum. White Gold has budgeted $1.3 mln in exploration for 2017.

Money Claims

The Money claims consist of four claim blocks totaling 24,880 ha and cover a number of placer-gold-bearing creeks. Two targets have been identified – Lira and Dime. Lira reportedly has a gold-in-soil anomaly stretching over 400m associated with an east-northeast striking shear zone. High-grade grab samples have been reported and a Historic RAB drill hole returned 4.93 g/t gold over 12.2m. The mineralization consists of quartz-sericite altered felsic gneiss with brecciation, quartz veining and disseminated pyrite. The Dime target has three easterly trending gold-in-soil anomalies with elevated As, Pb and Sb. Alteration and associated mineralization is reportedly similar to that at Lira. Historic trench results are highlighted by 1.01 g/t gold over 20m from trench 11-10 and a historic drill intercept of 8.32 g/t gold over 1.45m from hole DDH-11-6. The budget for the Money Claims is almost $850,000 for 2017.

Additional work is planned, on a smaller scale, for the Klondike Claims ($402,000 budget), Coffee Trend East Claims ($275,000 budget), Coffee Trend West Claims ($100,000 budget) and the Beaver Creek Claims ($135,700 budget). Almost $2mln in additional budgets is earmarked for regional work.



As of mid-June, 2017, White Gold had approximately $22 mln in cash. This is after the Company paid $10 mln in cash to Kinross for the “White Gold Properties” including the Golden Saddle Deposit which hosts approximately 1 mln ounces of gold. This payment was partially offset by an $8.76 mln investment by Agnico Eagle to maintain their pro-rata ownership interest in the Company.

White Gold has budgeted $7.1 mln in exploration expenditures for 2017.

Management and Directors

Dave D’Onofrio, CEO – Mr. D’Onofrio has spent over 10 yrs working in accounting, specializing in audit and taxation advisory roles. His focus has been on small to mid-cap resource and technology companies. Mr. D’Onofrio is also CFO of PowerOne Capital Markets Ltd.

David Schmidt, CFO – Mr. Schmidt has over 15 yrs of experience as a consultant to the mineral resource industry advising on financings and corporate development. David has a BASc. (Mining) from UBC.

Shawn Ryan, Chief Technical Advisor – Mr. Ryan has over 20 yrs experience prospecting for gold in the Yukon. His work led to the discovery of the White Gold (initially held by Underworld Resources), Coffee and QV (owned by Comstock Metals Ltd. (CSL-TSX.V)) deposits. Mr. Ryan is the founder and Technical Advisor for Ground Truth Exploration.

Robert Carpenter, PGeo, Director – Mr. Carpenter founded Kaminak Gold Corp. and lead the team, as Pres and CEO, that discovered and advanced the 3 mln ounce Coffee Gold Deposit. Mr. Carpenter has a PhD from Western University and has over 25 yrs of experience.



Important Information and Legal Disclaimers

This report has been prepared for general information purposes only and should not be considered either a solicitation for the purchase or an offer of securities. This research report does not constitute a recommendation. The securities mentioned in this report may not be suitable for all types of investors. The information contained in this report is not intended as individual investment advice and is not designed to meet any particular investment objectives, financial situations, or needs. Nothing in this report constitutes legal, accounting or tax advice.

Information, opinions and statistical data contained in this report were obtained or derived from sources believed to be reliable, but its accuracy cannot be guaranteed. PearTree Securities Inc. (“PT Securities”) and/or its affiliates and/or any of their respective officers, directors, and representatives (collectively “PearTree”) does not represent that any such information, opinion or statistical data is accurate or complete (with the exception of information contained in the Important Disclosures section of this report provided by PearTree or individual research analysts). Any opinions or analysis herein reflect the views of the Analyst as at the date appearing above, and are subject to change without notice. The Analyst writing the report is not a person or company with actual, implied or apparent authority to act on behalf of any issuer mentioned in this report.

PearTree may, in exchange for remuneration, participate in the financing of companies mentioned in this report. PearTree analysts are salaried employees who may receive a performance bonus that may be derived, in part, from corporate finance income. PearTree and members of their families may hold positions in the companies mentioned in this report and may buy and/or sell these stocks on the market or otherwise.

PearTree shall not be held liable for any loss or damage resulting from the use or the implementation of the information contained herein, except to the extent that liability may arise under specific statutes or regulations applicable to PearTree. The investments to which this report relates can fluctuate in value.

Dissemination of Research

Research reports are disseminated through electronic medium or in printed copy. Clients may access reports on our website, or receive publications directly via email. PearTree strives to ensure all recipients receive research in a timely manner and at the same time.

For Canadian residents: PT Securities is registered as an Exempt Market Dealer, a Registered Portfolio Manager and Investment Fund Manager pursuant to NI-31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. PT Securities is a subsidiary of PearTree Financial Services Ltd., an unregistered firm that consults to charities on tax and other matters related to a flow through share donation program.

For US residents: The information provided herein is not intended for distribution to, or use by, any person or entity in any jurisdiction or country including the United States, where such distribution or use would be contrary to law or regulation or which would subject PearTree to any registration requirement within such jurisdiction or country.

Analyst Certification

I, Gary Baschuk, hereby certify that the views expressed in this report accurately reflect my personal views about the subject and the issuer.


Important Disclosures

Of the companies included in the report the following Important Disclosures apply:

Ticker Company 1 2 3 4 5
AEM-TSX Agnico Eagle Mines Ltd.
ASR-TSX Alexco Resource Corp. x
ATC-TSX.V ATAC Resources Ltd. x x
ABX-TSX Barrick Gold Corp. x
CM-TSX Canadian Imperial Bank of Commerce
CSL-TSX.V Comstock Metals Ltd.
G-TSX Goldcorp Inc.
HBM-TSX Hudbay Minerals Inc.
K-TSX Kinross Gold Corp.
NG-TSX Novagold Resources Inc.
OGC-TSX OceanaGold Corp.
OSK-TSX Osisko Mining Inc. x
SMD-TSX.V Strategic Metals Ltd.
WG-TSX Wellgreen Platinum Ltd. x x
WPM-TSX Wheaton Precious Metals Corp.
WGO-TSX.V White Gold Corp.
VIT-TSX.V Victoria Gold Corp. x
1 The Analyst(s) preparing this report (or a member of the Analyst’s household) have a financial interest in this company.
2 PearTree has managed or co-managed or participated as selling group in a private placement for the issuer’s in the past 12 months.
3 As of the end of the month immediately preceding the date of issuance of this research report or the end of the second most recent month if the issue date is less than 10 calendar days after the end of the most recent month, PearTree collectively beneficially owned 1% or more of a class of the issuer’s equity securities.
4 PearTree has visited projects of the issuer and a portion of the expenses for this travel may have been reimbursed by the issuer.
5 PearTree, the analyst or an associate of the analyst responsible for this report or any individuals directly involved in the preparation of this report hold or are short the issuer’s securities directly or through derivatives.
The research analyst is not aware of any other material conflict at the time of publication.

This newsletter is dedicated to providing insight and analysis on Canadian mineral exploration and development stories. We welcome your feedback.

PearTree Securities is the largest provider of mining flow through capital in Canada. As an exempt market dealer and portfolio manager, PearTree Securities has approximately $250 million available for investments annually.

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