What a difference a few years can make.
I first visited the Yukon in 2007. We saw five sites on that tour, the highlight being the newly commissioned Minto copper-gold mine, and left feeling that the Yukon was vast, beautiful and probably underexplored, but not particularly exciting.
In August I returned, for the same gracious government trip, and the place is barely recognizable. In 2007, it was hard to list five really good Yukon projects. In 2010, I saw 12 solid properties and could have visited more. The Yukon is hopping and many believe these are the early days of a new Yukon gold rush.
When you're up there, when you learn the story and see the puzzle pieces start to fit together, when you're immersed in the tangible excitement, it is easy to believe they might well be right.
Placer miners in the Yukon have recovered 12 million reported ounces of gold since 1897. However, few hard rock deposits have been found. The main reason is the territory itself -- it is a cold, rugged place and access is limited.
Up to the end of the 1970s major mining companies took on the challenge, and potential rewards, of regional exploration. Regional exploration is hard work -- bushwhacking through wilderness to take thousands of soil and stream sediment samples in the hopes that a few will return anomalous levels of an interesting element.
But in the 1980s, just as geologists were developing a raft of new exploration tools, the majors stepped away from regional work. For quite some time no one in the Yukon did much regional exploration at all. Then, in the mid-1990s, a man named Shawn Ryan and a geological consulting group named Archer Cathro started picking up where the last big programs left off.
Ryan is a prospector. He had no formal training but believed in Yukon gold. He learned how to soil sample by peppering the folks at the Yukon Geological Survey (YGS) with questions. The YGS also supported Ryan, replying to his annual proposals with $10,000 exploration grants that had to cover his work and support his wife, Cathy Wood, and their two children.
Ryanwood Exploration, their company, relies on soil sampling because the White Gold area was not glaciated in the last ice age, so the soils have been in place for more than 10,000 years. That's long enough for gold to percolate upwards from the rocks below.
Ryan collected thousands of soil samples. When anomalies arose, he staked the ground and tried to option it. In 2004, eight years into his effort, he identified the anomaly that, a few years later, led Underworld Resources to its White Gold deposit and a $138-million takeover by Kinross Gold.
Now Kaminak Gold is hitting gold at its Coffee project, which is another Ryan anomaly. In fact, Ryan has taken to calling it the King Tut anomaly -- its size impresses even him. And this summer Ryanwood's 55 employees will collect 70,000 soil samples from huge swaths of land.
Archer Cathro is also enjoying success. The company's regional work identified the Rau project, which Atac Resources is now drilling with success. And Rau is a regional story in itself -- the Tiger gold zone is exciting but other targets on the 185-km long property look as good or better.
A gold rush requires several ingredients: signs of gold, believers, and funding. Ryan, Archer Cathro, and other long-time Yukon prospectors like Bill Harris of Northern Freegold have revealed the signs of gold. Believers are flocking to the area -- in the first seven months of the year the Mining Recorder's Office recognized 110,000 claims, which is almost 40% more than the 80,000 claimed in 2009. And 2009 was already a record year.
And the funding is not far behind. In 2003, the combined exploration budget for all companies in the Yukon was less than $30 million. This year, it is expected to top $183 million. Kaminak just raised $14.5 million; Atac added $22 million to its coffers; even Taku Gold, which hasn't yet put a drill into its Shawn Ryan properties, had no trouble pulling $3.5 million from the markets.
The story makes sense. The Yukon's wealth of placer gold had to come from somewhere, and it is pretty unlikely that the source deposits have all eroded away completely. On the Alaskan side, the Tintina gold belt has been very productive and rocks don't care about borders.
The lack of regional work explains why these deposits were not found earlier. And there are few places in the world that offer this kind of prospectivity in a politically stable, mining friendly territory that offers the added benefit of settled land claims with nine of its 11 Native groups.
There are challenges, to be sure. Access is still limited and the terrain rough. Power lines are few and far between, and often don't carry excess amps anyway. The Yukon is too small to take on major infrastructure projects, so the federal government will have to support mineral development, when it comes to that.
But for now, the discoveries are real and the rush is on.
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