Section 14, T. 20 S., R. 2 E., Fairbanks Meridian
WHITE CREEK, VALDEZ CREEK MINING DISTRICT, ALASKA
James E. Adler
Minerals Geologist, C.P.G.S.
On-Line Exploration Services, Inc.
INITIAL PLACER EVALUATION OF THE LUCKY WISH PROPERTY
Section 14, T. 20 S., R. 2 E., Fairbanks Meridian
WHITE CREEK, VALDEZ CREEK MINING DISTRICT, ALASKA
By James E. Adler
The six rotary drill holes, comprising drill line 100, discovered a buried pacer on the Lucky Wish property.
The preglacial or proglacial placer has been covered and preserved by glaciofluvial materials; gravel and heavy clay. Subsequent glacial activities of erode the buried placer. Ground water in the better washed glacier gravels now has developed sufficient head to produce low-volume flowing wells.
Drilling has shown placer values of 0.07 ounces per yard ($28.04) over the thickness of 12 feet and a width of more than 200 feet. The drilling has not closed out the values on the upslope (northeast end). There is apparently and erosional gap (scour) in the placer values with the most southwesterly hole almost having good values.
The placer on trill line 100 is geologically very similar to the channels that are currently being mined by Valdez Creek mines and could represent a continuation of one of those channels.
One option for the present owners is a phased exploration program. This program, as recommended, should be completed one step at a time to avoid fruitless expenditures.
From September 18 through September 25, 1987, one line of six cased rotary holes were completed at the Lucky Wish Mine property on White Creek, a tributary to Valdez Creek, near the old townsite of Denali, Alaska.. This constitutes the initial drilling on this placer property. Gold values discovered by this drilling are significant and the property deserves additional exploration. This initial drilling program was terminated to:
LOCATION - ACCESS
White Creek is a small northwesterly flowing tributary of Valdez Creek. The area is located about midway between Paxson and Cantwell in East Central Alaska (Figure 1). From milepost 77 Denali Highway an improved gravel road extends six miles north to the Valdez Creek placer mine, near the old townsite of Denali. An additional nine miles of unimproved road up Valdez Creek are traversed to reach the Lucky Wish Property (Figure 2). It requires approximately eight hours to reach the property on the road system from Anchorage, Alaska.
Between 1903 and 1972 and estimated 30,000 ounces of placer gold was produced from the Valdez Creek (Denali) mine, (Smith), which is now operated by Valdez Creek Mining, Inc. on Valdez Creek. This production came form the Tammary channel and the extension, the Dry Creek Cut.
The Valdez Creek district in total produced 35,000 ounces of placer gold by 1936 (Tuck, 1938). This production is illustrated on Table 1.
TABLE 1 - PLACER PRODUCTION VALDEZ CREEK MINING DISTRICT
The first production was form recent gravels of Valdez Creek, but the majority of production was form the deeply buried Tammany channel. This pre-glacial paleochannel was mined by two hydraulic cuts and by extensive underground drift mining.
From 1979 through 1981, Denali Mining Ltd. Conducted over 6,000 feet of reverse circulation and churn drilling on the Denali property.
In 1983 and 1984 WGM conducted an extensive exploration and drilling program for the consortium of six companies led by Camidex Mines Ltd of Toronto.
Exploration methods used included geological mapping, magnetic, refraction seismic and resistivity surveys, followed by drilling. A combination of geophysical methods has been required to adequately target subsequent drilling. No single geophysical method has been completely indicative of the placer targets.
During the WGM program, over 30,000 feet of reverse circulation , air rotary and churn drilling outlined reserves of approximately 69,000 ounces of gold. Of this total, 56,000 ounces was contained in high grade gravels averaging over 0.2 ounces per cubic yard (Bressler, 1984)
The multiple channel gravels average twenty five feet thick and are overlain by glacial outwash deposits from 60 to over 300 feet thick, Drilling has extended the channels and reserves upstream for at least 8000 feet. Upstream, the buried placer channels lose the deep incised characters and broaden.
The Valdez Creek (Denali) placer gold mine was placed in operation as a standard truck and loader open pit mine operation in May 1984. Mining on a seasonal basis since that time, has made this open pit the largest gold producer in Alaska for three years 1984-1986 with reported production of approximately 80,000 ounces. Total production for the mine 1903-1987 probably exceeds 125,000 ounces.
Obviously, a large placer mining operation, such as the Valdez Creek Mine, renews interest in the district. Large claim positions have been acquired both by Valdez Creek Mining, Ltd. And others. During 1987 Ashton Exploration and three churn drills outlining a placer at the mouth of White Creek with good values reportedly found.
In any exploration program, the first critical step is to assure uncontested ownership. From the amount of active interest in the Valdez Creek District created by the large, Valdez Creek Mine; Land ownership problems have undoubtedly been created by overstaking and paper staking (recording claims without actually staking same on the ground). It is probably this type of situation which has prompted Ashton to survey the claims on lower White Creek for patent and to proceed with patenting. The patenting process, title records and advertisings bring forth any parties who contest the granting of patent.
Mr. Joel Nelson and partners (Lucky Wish Mine) have claimed groups covering Upper White Creek, Rusty Creek and Big Rusty Creek. Before and additional exploration on the Lucky Wish property, land records need to be researched to:
The land ownership and land records can not be understated. The land record needs to be carefully examined and documented by a knowledgeable landman before additional exploration expenditures are incurred. It would be pointless to find an economic placer only to have the property tied up by a litigant or a previous interest that was considered to be retired.
Between September 18 and September 25, 1987 six air-rotary holes were drilled totaling 424 feet. These holes, designated as line 100, are at the lower (north) end of White Creek property positioned held by Luck Wish Mines (Figure 3). Hole depths varied from 40 to 83 feet. Difficulties are encountered pulling casing with the rotary drill rig. Casting was left in holes 18/100 and 24/100. The drill used is a Chicago Pneumatic 670 with a Wellen 1262 casting hammer and the air compressor developing 600 c. f. m. at 2050 p. s. i. Standard placer drilling techniques for thawed ground were used. Six inch diameter casting with a seven and one-half inch casing shoe was driven ahead of the rotary drilling. Dave Archiebald, driller, tried conscientiously to follow these Drilling/sampling procedures:
The core of gravel that came up inside the casing was then drilled out with the rotary bit and air circulation to provide an uncontaminated sample. Every effort was made to retain at least six inches of core inside the bottom of the casting (the drill bit was always at least six inches inside the casting, behind the casting shoe), to minimize sample contamination for excessive material running under the casing from the sides of the hole.
The method generally worked very well and provided clean discrimination of gold-bearing gravels on several of the sample breaks. Drilling ahead of the driven casing was only permitted when the casing could not be advanced, such as into a boulder or when unfractured bedrock was encountered. Excessive sample volumes were encountered, particularly in the water-saturated lower gravels. Water, as well as, some gravel accumulated in the casting when casing or drill stem were being added.
Samples at the drill were collected from the discharge tube into clean volume buckets or into a large garbage can, then removed into volume buckets. An attempt to use a homemade cyclone at the end of the discharge tube promptly failed. The high clay content was caused the machine to immediately plug. The surplus water that was collected as the hole advanced was later decanted form the buckets after the fines had settled at least 15 minutes.
Initially, all samples; which represented continuos five foot intervals, were collected, volumed and processed through and E-Z panner. Eventually samples from only the lower portion of the holes were processed unless gold colors were observed by panning.
Field Sample Processing
On September 18 & 19, 1987, Kevin Alder, Mining Engineer, set up and used the E-Z panner. He also instructed personnel on the proper processing and recording methods.
September 24, 1987 tests were conducted to check the efficiency of the E-Z panner. E-Z panner manufacture specifications for cleanup of sluice concentrates containing thin, small and flag gold were used. These are a measured water flow of 22 gallons of water at 45 p.s.i. and a feed rate of 20 pounds of material per minute. Because of high clay content in the feed and the necessity to dissegregate and clean clay for pebbles, this is the same feed and flow rates that have been used on previous samples during processing.
A 2.7 cubic foot sample form Hole 100/18, interval 65-70 was processed. All the oversized material (+3/8") was caught and after completion of sample processing was thoroughly rewashed through a 1/8" screen. The undersize from the 1/8" screen was hand panned. No gold was found.
All undersized (-3/8"), which passed through the oscillating riffle concentrator, was retained in a bathtub. Upon completion of the sample run, excess water was decanted from the bathtub using and siphon hose. All material in the bathtub was placed in buckets and carried to a nearby stream. The material was the processed through a hand sluice, one cupful at a time. This mini-sluice has previously been used to clean up sluice box concentrates and is known to retain fine gold. After running all the material through the mini-sluice, the concentrates from the mini-sluice were then hand panned. Pyrite, even coarse pyrite, was found but no gold was observed.
No gold was found in either the oversized (+3/8") or undersized (-3/8") products discharged form the E-Z Panner.
No gold was seen when the concentrates were cleared from the E-Z Panner riffle box. The concentrates were carefully hand panned. Both Pyrite and visible gold was observed. The gold colors included a very small, "fly spec" - sized particles that were only verified with a hand lens.
A second test was conducted by preparing oversized and undersized material in the ratios that had been recorded for previous samples. A small amount of gold (10 colors) were then salted into the prepared gravel. This material was processed through the E-Z Panner using the above described feed and flow rates. All ten colors were recovered in the first two riffles on the E-Z Panner concentrating box.
Processing the E-Z Panner concentrates form various drill hole samples involved concentrating the minus 20 mesh fraction on a Gemini Table. Gold fractions recovered form the samples included 200 mesh gold that had to be separated microscopically. During microscopic examination it was observed that gold particles as small as 100 microns were recovered.
The E-Z Panner not only appears to adequately recover the gold from this property; it also recovers gold down below the 200 mesh screen size when properly operated. The E-Z Panner certainly appears to recover all the gold that would be recovered during full scale processing.
Material recovered from the E-Z Panner sluice was wet screened to minus 1/8". The oversized (+1/8 -3/8") was retained as a geological reference sample, and the undersize (minus 1/8") portion become the concentrate sample containing the gold. The concentrate samples were cleaned at the Valdez Creek Mine.
Laboratory Concentrate Preparation
Clean up of concentrates form the E-Z Panner was conducted using the methods, equipment and assistance of personnel at the Valdez Creek Mine. The help and assistance of these people are gratefully acknowledge. Concentrates from the drill samples were wet screened through 8, 10 and 20 mesh size fractions were separately recovered by hand panning. All minus 20 mesh fraction was processed over a Gemini table. The seconds from the table were examined for gold with a 14 power hand lens and found to contain no free fold. Concentrates from the table, plus any coarse and medium gold from the hand panning were dried and hand picked and dry blown to remove contaminates. The recovered gold was microscopically examined and weighed. The gold weighs and sample volumes have been used in calculations.
Ashton Mining is currently drilling out a placer at the mouth of White Creek. Approximately one-half mile above the Ashton drilling, a bench has been worked by a series of small hydraulic cuts. Drill line 100 is about three-quarters to one mile above the old hydraulic workings. The lucky Wish camp and an adjacent, recent cut ("Camp Cut") in White Creek, are located, about 1800 feet above this drill line, near the confluence of Rusty Creek and White Creek (Figure 2).
At the mouth of White Creek, good values are reported in depths to bedrock of 90 feet. Large boulders in the overburden, near the surface, and abundant garnets are reported in the concentrates. This placer may be of recent (Holocene) age.
L. S. and H. M. Wickersham worked the right limit (Northeast Side) benches which are above Ashton's drilling. The gravel is more than 15 feet deep and drilling showed that the average bedrock is 20 feet. The placer gravel in the cuts is chiefly poorly sorted but little worn slate. Slide rock mixed with gravel partly overlines the placer. Boulders up to two feet in diameter are abundant. Gold is disseminated throughout the gravel and slide rock. Most of the gold is rough , many pieces still having quartz adhering to them. Hessite is fairly common in the concentrates. Although the cuts seldom reach bedrock, the ground worked had averaged 30 cents a cubic yard (Tuck, 1936, p. 128). This is probably the mine from which part of the 500 ounces were produced on White Creek (Tuck, 1936).
The recent cut, near the Lucky Wish camp, has produced very ragged gold. This gold is poorly rounded, contains appreciable included quartz and some iron strains. This gold has not undergone extensive tumbling or abrasion. Garnets are also present in the concentrate cleanups. Ilmenite/magnite boulders have also been found in backhole pits along the right limit (northeast) alluvial apron. This apron along the northeast side of White Creek is apparently unsorted and is probably glacial drift.
Gold Character And Concentrates
There is no similarity between the character of the gold from the "Camp Cut" and that at drill line 100. These two types of gold are almost at extreme ends on a scale of roundness. These two types of gold are almost at extreme ends of scale of roundness. The type of associated material is different also: well-washed vs unsorted, and the associated concentrates pyrite vs garnet are also different (Table 2). Any pyrite, if present, has weathered out of the near surface "Camp Cut".
TABLE 2. - WHITE CREEK GOLD AND ASSOCIATED MINERALS
The gold deposition on drill line 100 and that at the "Camp Cut" are of two different ages. Different erosional/depositional conditions were active when each was formed. Alluvial transportation, sorting, rounding and deposition formed the placer at drill line 100 prior to the deposition of Glaciofluvial gravels Eluvial or glacial deposition of ragged, poorly rounded gold in unsorted gravel occurred near the camp.
The placer at the mouth of White Creek could be the result of reworking the garnet-rich bench placer or reworking both the bench placer and placer at drill line 100.
The downstream extension of the placer on drill line 100 is unknown. Because of the lack of garnet and presence of pyrite, it is not obvious that the gold on drill line 100 correlates with the placer at the mouth of White Creek.
Geology Drill Line 100
Drill line 100 has a surficial mantle of surface boulders. The mantle is underlain, at a depth of about one foot, by water saturated, partially weathered, glaciofluvial gravels. Pebbles are of approximately the same composition as in the lower unweathered gravels. Water and brown to gray clays occur in these surface gravels to a depth of 5 to 20 feet where increased clay content shuts out all water. These surface glaciofluvial gravels are underlain by unweathered gelaciofluvial gravels.
Unweathered glaciofluvial gravels are characterized by:
The top of the placer-bearing gravels occurs at a depth of 20 to 58 feet. Pebble rock types are almost identical to the overlying gelaciofluvial gravels. The following differences characterized the lower gravels:
Flat, well-rounded placer gold occurs associated with abundant pyrite in the concentrates. Medium to coarse gold constitutes over 90 percent of the gold weight. Fine gold is present in the minus 60 mesh to minus 200 mesh sizes. Garnet is absent except in the minus 20 mesh fraction of the concentrates. The garnet when noted is rare pink crystals. Magnetite/ilmenite is very rare in the concentrates.
Bedrock is black argillite with pyrite as films. Fracture coatings and occasionally in thin veinletts. Local quartz and/or calcite is present in veinlets. Soft decomposed bedrock, when present is limited to two to three feet thick. No evidence of weathering is present in either the lower gravels or in the decomposed bedrock.
The bedrock configuration is normal for an alluvial valley and does not appear to have been glaciated. The glacier overrode this section of the valley and placer.
Where tested on drill line 100, a preglacial or proglacial placer has been buried and preserved by younger deposits (Figure 4). Deposition of coarse, well-rounded gold beneath glaciofluvial gravels is characteristic of the placer deposits currently being mined on lower Valdez Creek.
The shape of the placer suggests a buried bench. The southwest side of the deposit appears to have been eroded, possibly be a scour channel through hole 22, then the valley filled and the placer covered by glaciofluvial deposits. A braided stream choked with clay, silt, pebbles and an occasional boulder characterized these glaciofluvial deposits. A small lake may have been present. Subsequent glaciation did not scour deep enough to remove this older placer deposit.
Gold Source Area
It is possible that some gold has been transported from another buried paleoplacer or source occurring to the east. Both physical and chemical evidence suggests the possibility of migration from the east:
The extension of drill line 100 to follow the shallower gold up slope to the east is highly recommended. The possibility of multiple channels should not be overlooked. As high placer values also occur in hole 24, placer values should traced by additional drilling to the southwest along drill line 100. Gold has been reportedly recovered from both Big Rusty Creek and from a cut four miles above the mouth of White Creek (Smith, Bundtzn, 1981). A bedrock source for the placer gold could occur near the head of White Creek and also within the Big Rusty drainage. Therefore, untested placer potential could occur for at least two more miles up White Creek, above drill line 100 possible on Big Rusty Creek (Figure 2).
The upstream extent of the buried preglacial placer is unknown. Later glacial scouring may terminate this deposit short of a potential source area.
The actual gold grade of a placer can not be determined by one drill line nor can reserves be assigned. It is very significant that the initial drill program discovered a placer that is geologically similar, if not identical. To those current being mined in the district. It could very well be an upstream extension of one of those placer channels. Additional exploration of this property is certainly warranted and is needed to outline the volume of material to establish reserves.
Theoretically volumes for each hole are based on measured casing shoe diameters at the beginning and end of each hole. The Valdez Creek mine uses a 30 percent swell (expansion) factor for volumes based on experience in similar ground. This same 30 percent expansion factor was used to convert measured bucket volumes to in-place ("bank") yards. Actual (bucket) volumes have been used when these exceeded theoretical volumes. The theoretical volume was applied when actual volume was deficient.
A gold fineness of 850 (85 percent pure gold in the raw placer gold) was based on Valdez Creek mine experience and the well-rounded character of the gold. Actual assays should check the fineness before any final calculation of placer reserves is made.
A gold value of $400/ounce for in-place cubic yards is included in Appendix A, PLACER DRILLING LOG - SAMPLE PREPARATION. Drill line 100 Cross Section, (Figure 4), shows the placer has a width of over 200 feet. Interpolation between holes 22 and 24 plus the open upslope end of the line to the northeast makes this placer in excess of 200 feet wide. A gold value of $400 per ounce has been applied (Appendix A). The thickness and value of the placer depends on the minimum cutoff grade. Two cutoff grades show the relative thickness and value of the placer on drill line 100 (Table 3).
TABLE 3 - THICKNESS AND VALUE OF THE PLACER - DRILL LINE 100
The high values in hole 24 are not considered in the above values because hole 24 is on the southwest side of the barren hole, hole 22 which is probably in a scour channel of rewash gravels.
The gold deposition on drill line 100 is preglacial or proglacial and is older than the gold at the Lucky Wish Camp and possibly older than the gold in lower White Creek. The placer on drill line 100 is very similar to the gold deposition on lower Valdez Creek, where mining operations are currently being conducted. It is possible that this placer is a continuation of one of the placers that is currently being mined.
The extent of this placer is unknown and until the extent has been delineated proven reserves are not established. Continued exploration is reviewed under Recommendations.
Overburden and water conditions are similar to those encountered on lower Valdez Creek, therefore a large established placer reserve must be discovered before any bulk testing or mining is considered.
Exploration for mineral deposits is an expensive undertaking that is not often successful. Before investing more capital to exploration the present owners should seriously consider the probability of success and determine if the property can be optioned to a major mining company.
If continued exploration is the choice, exploration should be conducted one phase at a time. To step out of phase is to get the cart before the horse. The results in expansive, sometimes fatal, errors based on insufficient information that should have previously been obtained.
The basic phases are:
Permitting for that various phases is dependent on the anticipated progress for the season. Such factors are a base line environmental study and an archeological study are needed for any large operation.
All phases need to be scheduled, budgeted and planned in advance. To step ahead into the next phase without completing the prior phase is to court disaster. Exploration finances should not be wasted by poor planning or incomplete information that results when a project is out of phase.
At this point, phases 1 through 3 do not appear to have been adequately examined before attempting phase 4. A careful review of the first three phases should be made, including the development of exploration targets, before additional drilling is conducted. These first three phases should conducted during the Winter and Spring of 1987-1988. Budgeting, planning, scheduling, and permitting should be conducted concurrently so that drill testing can resume during the late Spring or early summer of 1988.
This report was prepared by ON-LINE EXPLORATION SERVICES, INC., with offices located 11979 Wilderness Drive, Anchorage, Alaska.
I, James E. Alder, certify that:
Dated this 20th day of October, 1987, in Anchorage, Alaska.
James E. Adler. B.Sc.
Licensed professional Geologist
Alaska, No. 47
Bressler, J.R., Jones, W.C. and Cleveland, G, Abstract - Geology of a Buried Channel System at the Denali Placer Gold Mine, Alaska Miners Association - Ninth Annual Convention and Trade Shoe, Anchorage, October 31-November 3, 1984.
Hamilton, T.T., Reed, K.M., and Thorson, R.M., Glaciation in Alaska- The Geology Record, Alaska Geological Society, Anchorage, AK, 1986.
Ross, C.P., The Valdez Creek Mining District Alaska, U.S. Geological Survey, Bulletin 849-H, Washington, D.C., 1933.
Smith, T.E., Gold resource potential of the Denali bench gravels, Valdez Creek mining district, Alaska, in U.S. Geological Survey Professional Paper 700-D, p. D 146-52, Washington, D.C, 1970
____, Load gold occurrences in the Western Clearwater Mountains, in U.S. Geological Survey professional Paper 700-A. P.A 47, Washington, D.C., 1970.
____, (Economic Geology Section by Bundtzed, T.T.) Geology of the Clearwater Mountains, south-central Alaska, Geologic Report 60, State of Alaska, Division of Geological & Geological Surveys, College, Alaska, 1981.
Tuck, R., The Valdez Creek Mining District Alaska, in 1936, U.S. Geological Survey, Bulletin 897-B, Washington D.C., 1936.
APPENDIX A: PLACER DRILLING LOG - SAMPLE PREPARATION