For a junior exploration company that started trading on the TSX Venture Exchange in late November 2020, Whitehorse Gold (TSXV: WHG) has made significant progress at its 100%-owned Skukum gold project in the southern Yukon, about 55 km south of Whitehorse.
The 170 sq. km project consists of the Skukum Creek and Goddell gold deposits, and the past-producing Mt. Skukum gold mine, which produced 79,750 oz. of gold from 1986 to 1988. All three deposits have existing resources, with Skukum Creek the largest.
“What’s exciting about the property is that we’re not just dealing with a single deposit but three separate deposits, all with resources, as well as numerous other showings on the property that will require further prospecting to get them to a drill-ready stage,” Whitehorse’s CEO Kevin Weston said in an interview. “Our geologists will not get bored on this property.”
Whitehorse Gold was initially created as a wholly-owned subsidiary of New Pacific Metals (TSX: NUAG; US-OTC: NUPMF) in July 2020 to advance the project, and its largest shareholder is Silvercorp Metals (TSX: SVM; NYSE: SVM), which holds a 27% stake in the company. Management and insiders hold an 11% interest.
“The property has remained dormant since New Pacific put out their last resource estimate in 2012 and hasn’t seen any modern exploration until we took it on last year,” Weston said.
A month before going public, Whitehorse Gold completed a resource estimate for the Skukum Creek deposit, outlining an indicated resource of 1 million tonnes grading 5.85 grams gold per tonne and 166.4 grams silver per tonne (7.75 grams gold-equivalent per tonne) for 118,334 contained oz. of gold and 5.36 million oz. of silver. Inferred resources add 537,000 tonnes grading 4.99 grams gold and 108.3 grams silver (6.22 grams gold equivalent) for 86,124 oz. of gold and 1.87 million oz. of silver.
Late last year the company completed a four-hole, 2,091 metre drill program on the Skukum Creek deposit’s Rainbow zone. The program was designed to better define the deeper portion of the zone and validate historic drill hole intercepts.
The first drill hole, SC20-001, intersected 8.93 metres grading 6.54 grams gold, 186.83 grams silver, 1.4% lead, and 0.99% zinc from 434.08 metres, including 1.22 metres grading 21.4 grams gold, 563 grams silver, 5.27% lead, and 3.59% zinc from 441.79 metres.
While the gold and silver grades are comparable to historic drill holes, Weston said, the true width of that drill hole interval is more than 2.5 times greater than previously modelled.
“The first drill result was very encouraging and verified both the depth and high-grade nature of the mineralisation at the property identified through previous drilling programs,” he said. “The deposit remains open for expansion and has the potential to be a significant future producer.”
Drillhole SC20-002, the second hole, cut 10.49 metres grading 8.13 grams gold, 175.11 grams silver, 0.84% lead, and 1.02% zinc starting from 417.45 metres, including 2.24 metres grading 25.24 grams gold, 636.47 grams silver, 2.53% lead, and 3.19% zinc.
Assay results for the remaining two drill holes are pending.
The property benefits from existing infrastructure, including a year-round access road, 4,800 metres of underground workings, a 272 tonne-per-day mill, tailings management facility, and service buildings.
“It’s rare in Canada’s North to be working on a project that you don’t have to take a four or five-hour drive or a small aircraft to get to,” Weston said. “You can be at the property in around an hour from downtown Whitehorse.”
The Skukum Creek area was first staked in 1922 to cover anomalous gold and antinomy showings. Since then, the property has seen considerable historical exploration, including diamond drilling and underground exploration.
Previous exploration consisted of surface geological surveys, ground and airborne geophysical surveys, trenching, and surface and underground drilling. Approximately 121,000 metres were drilled in more than 910 holes, and 7,630 metres of underground drifting and crosscutting were developed, mainly at Mt. Skukum, Skukum Creek, and Goddell.
New Pacific Metals gained full ownership of Skukum in 2011 after acquiring Tagish Lake Gold Corp., the previous owners of the property.
That same year, New Pacific undertook an exploration program consisting of a digital compilation of historical data, surface geochemical sampling, surface geological mapping, metallurgical test work, rehabilitation of underground workings, and camp upgrades.
A total of 51 diamond drill holes totalling 12,488 metres were completed on the Lake zone at Mt. Skukum, including the Skukum Creek and Goddell deposits, and various other prospects on the property.
Over the next 12 months, Whitehorse plans to drill 20,000 metres to test the downdip extension and strike potential of the Skukum Creek deposit, explore the Mt Skukum and Goddell deposits to better define and expand the current resources, and to undertake further prospecting work at six regional targets.
The company also plans to follow up historical metallurgical test work undertaken at Skukum Creek and in-house engineering studies to help identify the best direction in which to expand the resource.
In mid-November last year, it raised $6.79 million through a private placement financing that involved the issuance of 22.66 million common shares of the company at a price of 30¢ per share.
Following the financing, the company now has no debt and about $1.5 million in the treasury to fund this year’s exploration program and will go back to the market later in the year to raise more capital.
“We have some very loyal shareholders and have generated considerable interest from the market, so we don’t anticipate it being a big challenge to raise further capital to fund the exploration program,” Weston said.