Platinum traces

January 19, 2013

Platinum has risen in price recently to equal that of gold. The metal is not mined north of 56, and one platinum project is moving close to production. Alaska has the history while Yukon has the promising project.

There is in fact a community of 67 people in Alaska called Platinum. It is near a traditional village site called Arviq. The community was established shortly after traces of platinum were discovered by an Eskimo named Walter Smith in 1926. Between 1927 and 1934, several small placer mines operated on creeks in the area. Some 3,000 troy ounces of platinum were mined over that period, with a value of about $48 per ounce. A post office opened in 1935. The “big strike” occurred in October of 1936, which brought a stampede of prospectors for “white gold.” The claims proved to be too deep for hand-mining methods and were bought out by two companies. The largest, Goodnews Mining Company, eventually acquired title to over 150 claims. In 1937, a large dredge was built at the mining site, about 10 miles from the Village of Platinum. The company also constructed bunkhouses, a recreation hall, offices, shops, and a cafeteria. Platinum developed as a “company town,” with the store, water, and electricity supplied by the mine. A school opened in 1960. By 1975, 545,000 ounces of platinum had been mined at the site, and a city government was formed. The mine was later sold to Hanson Properties, who estimated reserves of over 500,000 ounces—it ceased operations in 1990. 

More recently, a company called XS Platinum reprocessed the tailings from historical operations, using a land-based facility to separate the metal from rock. The company hopes to expand the number of reprocessing plants to four by 2013. Together, the four plants could produce up to 120,000 ounces of platinum annually. The company has also expressed interest in mining virgin deposits in the area and has done some preliminary explorations. Other current XS Platinum activities include decommissioning the 1937 dredge located on site, extending the airstrip using tailings as runway material, and updating equipment.  In 2010 the company conducted a shallow drilling program consisting of 200 holes aimed at extending the resource.  XS Platinum is embroiled in a legal dispute with Hanson Properties and the future of mining activity is far from certain. Other companies, including Calista Corporation and Alaska Earth Sciences, have drilled exploration targets upstream of the placer claims in search of the lode (hardrock) source of the platinum and possibly gold.

In the Yukon, Prophecy Platinum’s Wellgreen project is the most promising find in the north. The Wellgreen project is located approximately 317 km northwest of Whitehorse in southwestern Yukon. Indicated Resource of 14.4 Mt at grades of 0.68% nickel, 0.62% copper, and 2.23 g/t platinum+palladium+gold. An additional Inferred Resource of 446.6 Mt at grades of 0.31% nickel, 0.25% copper, and 0.87 g/t platinum + palladium + gold. The project plan calls for a 32,000 t/d open pit mine that will be mined using conventional open pit mining methods over a period of 37 years. The total capital cost is estimated at $2.0 billion. The project would take 2.5 years to build and could start in 2018.

 

Commentary

The historical mining of platinum in the 1930s by placer methods contrasts with the modern geological and geo-technical analysis. The Wellgreen project is very large for a small jurisdiction like Yukon territory. It would result in 300 direct jobs to operate the mine and hundreds to built it.

Sources

• a)http://www.groundtruthtrekking.org/Issues/MetalsMining/Goodnews-Bay-Platinum.html



• b)http://www.alaskadispatch.com/article/foreclosure-extended-southwest-alaska-platinum-mine



• c)http://www.prophecyplat.com/project_wellgreen.php and http://www.prophecyplat.com/pdf/2012_07_Wellgreen_PEA.pdf