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Eskay Heart Of Gold Camp Update And The "Q" Vs. The "Ovoid" - BullMarketRun.com

February 12, 2017

Eskay Heart Of Gold Camp Update And The “Q” Vs. The “Ovoid”

It was another fascinating week in the EskayHeart of Gold Camp” which we predict is going to be one of the key engines that powers the Venture above the 1,000 level again this summer with so many companies preparing for drill programs (watch for our special section coming soon at BMR, dedicated exclusively to the Heart of Gold Camp 24/7).

Arguably, when one considers the discoveries at Eskay Creek, Snip, KSM and of course Brucejack which is progressing ahead of schedule toward commercial production this year, this district – still incredibly under-explored – is the richest part of the entire planet.  Grades of large Gold-in-soil anomalies are even higher than the average values of today’s mined deposits!

Eskay Creek – production of more than 3 million ounces of Gold and nearly 160 million ounces of Silver at 49 g/t Au and 2,400 g/t Ag…

Snip – production of 1 million ounces of Gold at an average grade of 27.5 g/t Au with rich new veins now being discovered!…

KSM – the world’s largest Reserves of Gold and Copper…

Brucejack – one of the richest Gold mines in the entire world with estimated annual production of 500,000 ounces at an average grade of about 15 g/t Au (geologists predict more discoveries in the Valley of the Kings)…

Pretium announced earlier this month that it’s accelerating the commissioning of the Brucejack mine by 2-3 months. Economics are robust. Base case post-tax NPV (5% discount) is $1.53 billion (U.S.) while post-tax IRR is 28.5%

High-Grade Gold And Cu-Au Porphyry Surrounding High-Grade Nickel-Copper!

Geologically, the latest “shocker” about this district is that a magmatic Ni-Cu-rich massive sulphide system, with PGE’s, Gold and Cobalt, has been confirmed in the heart of this Camp, on trend and almost exactly halfway between Snip to the northwest and Brucejack to the southeast, about 15 km southwest of Eskay Creek (that’s not a coincidence).

Is this district prolific enough to have created a Voisey’s Bay West at the E&L?  Absolutely, and that’s why multiple Voisey’s Bay experts are reaching out to Garibaldi Resources (GGI, TSX-V).   Think about how “juiced up” a system would have to be in order for high tenors of 4.8% to 8% Nickel and 2.1% to 10.9% Copper (in 100% sulphide) to outcrop over a broad area at the top of a mountain more than 6,000 feet high, with massive sulphides intersected through drilling to depths of more than 100 m below the surface showings!  Scroll further down for an image BMR has created to demonstrate the potential scale of the E&L.

Mining analyst Dr. Raymond Goldie, who wrote the book on Voisey’s Bay (“Inco Comes To Labrador“) and prospected in the Eskay Camp in the 1970’s, is calling the E&L “the top Nickel sulphide prospect in Canada.”  On Friday he joined the GGI Board of Directors along with Everett Makela who has spent much of his geological career with Nickel leaders Inco and Vale.

Senior Mining Company Moves In On SIB

Recently, we alerted subscribers to the new opportunity in Eskay Mining (ESK, TSX-V) immediately following the company’s January 26 game-changing news of a deal with an unnamed senior mining company that will pour nearly $12 million into exploration at Eskay’s SIB in order to acquire up to a 60% interest in the property (the deal has some moving parts to it, including the fact Kirkland Lake Gold has a first right of refusal option for 21 days, but a major drill program will be carried out at SIB this summer and that’s huge).  Since that time, ESK has surged 75%!

The SIB is very much a jewel of British Columbia’s entire Golden Triangle – if there’s another Eskay Creek in B.C., it’s likely at the SIB for multiple sound geological reasons.

The deadline for Kirkland to make a decision is imminent, so watch for more news any day now from ESK.  There have been no leaks in terms of who the unnamed “senior mining company” is – we are as curious as you to find out!

Think about how rich Eskay Creek was – astronomical Gold and Silver grades made it one of the greatest mining discoveries of all time!   It was quickly put into production and in its life span delivered more than 3 million ounces of Gold and nearly 160 million ounces of Silver (5th largest Silver producer in the world), plus other metals.  Consider, therefore, the unbelievable leverage ESK investors have. 

We’re convinced, and so are some highly respected geologists, that there is another Eskay Creek (perhaps more than one) at SIB given all that’s now understood about this amazing property after more than $30 million in exploration expenditures since the 1980’s.  The rocks and stratigraphy at SIB match Eskay Creek.  There’s now a solid theory on where to find the “motherlode”, and that’s why a major has stepped in.  More on SIB (and the rest of ESK’s impressive land package) with geologist Charlie Greig in the near future.

Now, consider this for a moment…

A senior mining company has just agreed to invest $12 million in exploration at the SIB in order to acquire up to a 60% interest in an area that represents less than one-tenth of Eskay’s entire land package in the Heart of Gold Camp!

ESK has some fantastic targets to chase beyond the SIB where it controls another 450 or so sq. km!

That’s why we’re saying, ESK stands for Essential Stock to Keep!

Meanwhile, Over At The E&L…

The E&L Critical “Checklist”

  • Known near-surface historical deposit (about 20 drill holes), not delimited in any direction
  • No holes completed in nearly 50 years – easy to believe how the “oldtimers” missed the biggest and juiciest part of the system
  • Much more is now known about Ni-Cu-rich massive sulphide deposits PLUS the district as all the area’s major discoveries (Eskay Creek, Snip, KSM and Brucejack) occurred AFTER massive sulphides were first discovered at the E&L
  • Very impressive “tenors” – 4.8% to 8% Ni and 2.1% to 10.9% Cu in 100% sulphide!
  • Critically important!! – source of sulphur for metal enrichment is interpreted to be the Hazelton Group shales
  • The right mineral assemblage – pyrrhotite-chalcopyrite-pentlandite
  • The “Q” anomaly – very broad and features a 600-m-long conduit shaped “keel” (big magma chamber?) south of original discovery
  • Big gravity anomalies (regional scale), a must for major Nickel sulphide deposits
  • Strong evidence for a powerful mafic-ultramafic intrusive event – that’s how “volume” can kick in
  • District setting – one of the world’s most richly mineralized areas, no reason why a “Voisey’s Bay West” could not have formed
  • Massive infrastructure build-up – power, new roads, etc. – huge advantage for GGI (consider the problems Noront has had!)
  • Western Australia (Kambalda comparative) – high-grade Ni massive sulphide deposits discovered within a high-grade Gold camp decades after Gold mining commenced
  • GGI has 100% ownership of the E&L at a “steal” of a price, just coming out of the bottom of the bear market when a claims holder was desperate for some cash and paper – wow, the deal of the year in this district!

About the only important thing not on the checklist at the moment – big conductors to chase!  That’s because no modern geophysics has been performed yet at the E&L.  We expect an extensive VTEM survey will be carried out by GGI while the weather is still cold (seasonal timing is important to get the best results).  A VTEM of course can read massive sulphides to a depth of 300 m or more.

Another important point to keep in mind which supports the case for the “Q” anomaly – big Ni-Cu-rich massive sulphide deposits don’t tend to occur in the most obvious place.   The oldtimers at the E&L, while they did an excellent job in the context of the times, were entirely focused on the “eye candy” at the top of Nickel Mountain.  They were hoping to turn this into a quick 10-million tonne near-surface deposit (they got one-third of the way there) that they could start mining ASAP.  It got more complex than they imagined and they didn’t have today’s modern tools to help them.  The ”Q” anomaly, perhaps the source of everything, wasn’t on their radar, nor were other potential areas.  It’s downslope in a treed area with limited outcrop.  Exactly the discreet, not-so-obvious place where the “motherlode” could be!

Great advances in technology, data processing and of course even “climate change” (glacial retreat) will give GGI’s team of experts an unusually strong chance of hitting a grand slam at Nickel Mountain, clearing the bases that were loaded up by historical prospectors.

The E&L Has Scale!

Below we have an interesting image that shows the Voisey’s Bay Ovoid (massive sulphides) and how it would fit (in scale) within GGI’s “Q” Anomaly.  This is simply for scale comparison – no drill holes have ever been put into the “Q” as the feature wasn’t even known to exist until about 2 decades after the Sumitomo exploration program was carried out in the 1960’s to about 1970.

The Ovoid, one of 3 zones at Voisey’s Bay, represents less than 25% of total tonnage but 43% of total metals given the high grades.

Keep in mind, the “Q” covers just a fraction of the 63 sq. km E&L Project and the depth potential for massive sulphides could also be very significant given what’s known about this district.

The VTEM is really the final piece of the puzzle given all the other facts at hand that suggest the oldtimers merely hit the tip of the iceberg when they found massive sulphides at the top of Nickel Mountain and drilled into them to depths of at least 120 m below the surface showings.  Limited underground drilling was toward the near-surface deposit and intercepted the host gabbro rocks but the geologists, not armed with today’s new technology or a full understanding of these rare type of deposits, misinterpreted how the pipe-like structures plunged at depth.  

 

Kirkham Will Kick!

We’ve stated this before and it’s worth re-emphasizing – Metallis Resources‘ (MTS, TSX-V) 100 sq. km Kirkham Property, directly below Garibaldi’s E&L, has tremendous geological potential that has so far been overlooked by Mr. Market.

Pay attention to Kirkham and Metallis…pay attention!

We have researched Kirkham extensively in recent months and we’ll be uncovering our findings in the near future.

Note:  John, Jon and Daniel hold share positions in GGI.  Jon also holds share positions in ESK and MTS.

2 Comments

  1. Consider the market caps of the juniors in the Golden Triangle too
    Eskay mining 36.8M
    CXO 26.45M
    Skeena 39.08M
    Tudor 39.09M
    GGI 13.19M
    Romios 10.04M
    Teuton 6.59M
    MTS 3.61M the sleeper of the bunch in my opinion
    Aben 2.27M

    Lots of room for these guys to run before they even began to look over valued if one of them hits on their drilling this summer, especially if it’s GGI hitting massive sulfides… look out, should be a fun summer in the Heart of Gold Camp

    Comment by greg — February 12, 2017 @ 1:21 pm

  2. “Check this piece later today as we’ll be adding an interesting image” = very interesting. If we look at the volume of the Voiseys Bay ovoid (estimating 250m across based on a quick image/map search and using 125m radius) we would get about 8million cubic meters (if we calculate it as a sphere). If the “Q” anomaly represents an ovoid along that 600m of keel, it makes you wonder how much bigger that ovoid could be. Hmmmm…very interesting indeed!

    Comment by Johnz — February 12, 2017 @ 1:55 pm

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