Make Kitco Your Homepage
Contributed Commentaries
  1. Kitco Metals Inc.
  2. Commentary Archive
  3. Bio

A Third Major Miner Enters the Yukon White Gold District

Nearly 20 years ago, a maverick trapper and mushroom picker decided to look for gold instead of mushrooms and ended up staking more than 35,000 claims in Canada’s Yukon Territory. During the gold bull that began in 2000, Shawn Ryan became the king of the new Yukon gold rush, the biggest since the legendary Klondike gold rush over a century ago. Credible estimates of the amount of gold still buried in his properties run to the billions of dollars. It is a true rags to riches story as he and his family were living in an abandoned miner’s tin shack with no electricity or running water at the time he decided to begin prospecting. Ryan spent winter nights by a wood stove reading old mining journals as temperatures in the dead of winter reached 50 below zero.

By 2001, after nine years of mushroom picking, the Ryan family had managed to save C$3,000. He and his wife decided to spend it on the first claim they called “Lucky Joe”, which they sold to junior miner Kennecott. Ryan then promptly spent the entire paycheck hunting for more gold, earning him the nickname “Double Down”. After two years of using a unique soil sampling method to discover multiple drill targets, they had sold a dozen options to various juniors as the price of gold continued to climb. To make a long story short, these claims have attracted the attention of three major mining companies.

Back in March of 2010, as the post financial crisis miner bull-run was in the blow off phase, global miner Kinross bought out Underworld Resources for C$139M. Underworld had made a major high grade discovery in 2008 from some of Ryan’s claims in the White Gold District of the Yukon. The buyout made Kinross the first major miner in the highly prospective and remote district to control a significant sized land package.

Eighteen months later, the gold bull came to an end as a vicious four-year bear market ensued. Kinross, along with most other major miners, were too busy concentrating on their balance sheets to be concerned with early stage development projects. So the property, as well as the district, became an after-thought while the price of gold plummeted to $1050 per oz by the end of 2015.

However, while the bear was raging, there was one company in the process of developing a high-grade heap leach operation in the same region. Kaminak Gold had a district scale land package they called Coffee, discovered by Ryan of course, which was getting the attention of the market because of its size and grade. As the sector turned in early 2016, Kaminak was bought out by Goldcorp for C$520M. With two majors in the district now, the Yukon was starting to get hot again as many of the exploration and development junior companies in the area began to receive attention and funding.

As the sector was bottoming last December, global miner Agnico Eagle bought into a new exploration company in the district that has been aptly re-named White Gold Corp, becoming the third major to invest in the district. This new company has tied up 30% of the area with all of the remaining Shawn Ryan claims and makes it the largest landholder in the White Gold jurisdiction. The properties range from grass roots to more advanced exploration projects with over C$30M having been spent on exploration to date.

Ryan is Chief Technical Advisor for White Gold Corp. and stated he would rather have all the claims in one company so that GroundTruth Exploration’s technology can explore targets much more quickly than was previously possible. The driller’s methods allow it to explore an area almost too quickly for a junior miner to manage. He told a Yukon News journalist recently, “What used to take us two field seasons and $500,000 is now taking us about a month for about $100,000.”

GoldTruth (a company jointly owned by Ryan’s wife, Cathy Wood, and long time associates Isaac Fage and Tao Henderson) has revolutionized remote exploration and will be used to explore the properties using their “Drones to Drills” technology, which facilitates year-round exploration with considerably less impact on the environment than traditional methods. This new technology uses a revolutionary GT RAB Drill - a remotely controlled tracked platform that is completely pneumatically and hydraulically operated. Drilling costs for the new company are only $135/m, a 70% reduction compared to the roughly $450/m cost of traditional method diamond drilling that has previously been used in the area.

White Gold Corp (WGO.V) is fully funded for a three year C$15M drill program scheduled this year through 2019.

With the purchase of the Coffee project by Goldcorp, the miners in the district are now lobbying to get a paved highway built which would create over 400 jobs as well as benefit many of the junior exploration companies in the Yukon. The Yukon Resource Gateway Project (YRGP) would spend C$468M over eight years, upgrading the placer mining road south from Dawson and extending the Freegold Road north from Carmacks. Funding of the YRGP is envisioned to run through 2024/25 and would be a partnership between Canada, Yukon, and industry with each sharing costs, risks, and benefits.

I strongly believe these factors will make many of the local juniors that have managed to tie up district size land packages, very attractive to majors going forward. Here is a list of companies in the area in which I have accumulated. Please do your own due diligence, as there are many others to choose from in this district as well.

Western Copper and Gold (WRN.TO)

http://westerncopperandgold.com/wp-content/uploads/2017/01/WRN_Presentation_Jan2017_Final.pdf

White Gold Corp. (WGO.V)

http://www.whitegoldcorp.ca/_resources/presentations/White_Gold_Presentation_Corporate_2017-Jan-03.pdf

Triumph Gold Corp. (TIG.V)

Website is under construction as new management changes over from former company Northern Freegold.

Independence Gold Corp. (IGO.V)

https://ingold.ca/assets/docs/presentations/IGO_Invest_Pres_VRIC&RUP_2017-1484939647.pdf

Klondike Gold Corp. (KG.V)

http://www.klondikegoldcorp.com/wp-content/uploads/Klondike_Presentation_Nov2016.pdf

By David Erfle Contributor to Kitco News
newsfeedback@kitco.com

David Erfle is a 52 year old self-taught mining sector investor. He stumbled upon the mining sector in 2003 as he was looking to invest into a growing sector of the market. After researching the gains made from the 2001 bottom in the tiny gold and silver sector he became fascinated with this niche market. So much so that in 2005 he decided to sell his home and invest the entire proceeds from the sale into junior mining companies. When his account had tripled by September, 2007, he decided to quit his job as the Telecommunications Equipment Buyer at UCLA and make investing in this sector his full time job. He personally survived two bear markets, witnessed incredible sector changes and had to alter his investment philosophy numerous times in order to adapt to changing market conditions."

 

 

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.
kitco news

Follow Kitco News

Precious Metal Charts