African Queen Mines Ltd.

Properties & Projects:Yellowjacket Gold Properties

Properties & Projects

British Columbia, Canada

Yellowjacket Gold Project

Location

The Yellowjacket Gold Project is an exploration-stage project located 9km east of Atlin, British Columbia. Historic mining operations and past exploration have focused around the Yellowjacket Zone which gives the project its’ name.

Access, Supplies and Electricity

The Yellowjacket Zone is accessible year-round by all-weather road. The claims lie along the Pine Creek valley which is an historic and continuing placer gold producing area that ranks as the second largest producer of placer gold in the province. Basic supplies and material to support mining activity can be readily sourced out of Atlin, and specialty services may be secured in Whitehorse, Yukon, located 180 kilometres north via Highway 7 and the Alaska Highway. Hydro-electric power has been recently established to within three kilometres of the property boundary.

Geology

Gold mineralization at Yellowjacket zone consists of coarse gold hosted in quartz stockworks and silicified zones in brittle volcanic and altered ultramafic rocks. Gold mineralization occurs along a prominent fault structure which is interpreted to control the distribution of placer gold reported in the area.

There are three zones of interest, the Yellowjacket zone, Rock of Ages zone and the Gold Run zone. Current mining operations and exploration efforts are focussed on the Yellowjacket zone. The Rock of Ages and Gold Run zones remain as excellent exploration targets as they have similar geophysical signatures as the Yellowjacket and are also located in the producing and historic placer workings. They will be the focus of future exploration work. Click here for a map of the Yellowjacket Gold Project Zones.

Hard Rock Exploration

In 1983, local area prospectors staked the Yellowjacket Property, and subsequently optioned the property to Canova and Tri-Pacific Resources. During 1984 and 1985 these companies conducted programs of ground geophysics, rotary and diamond drilling. In 1986 Homestake Mineral Development Company optioned the property from Canova and from 1986 to 1988 initiated programs of mapping, reverse circulation drilling and diamond drilling (52 holes totaling 8,057 metres).

At the completion of this program, Homestake reported a resource estimate of 453,500 tonnes grading 10.26 g/t (Schroeter, T.G. and Pinsent, R.H; BC Ministry of Energy and Mines Open File 2000-2: Gold Production and Resources in BC (1858 – 1998). (Though these estimates are considered by Yellowjacket Resource management to be relevant, they were prepared prior to the institution of National Instrument 43-101 standards. Their reliability has not been confirmed, therefore should not be relied on but will constitute a target basis for future exploration work).

Prize Mining (formerly Muskox Minerals) optioned the property in 2003 and from 2003 to 2006 drilled 57 holes for a total of 6,873 metres. A number of impressive intercepts were encountered during drilling, with values ranging from “no significant results” to grades as summarized below:

Historic Drill Intercepts at Yellowjacket Gold Project

Drillhole Interval Width Grade
YJ03-01 13.95m to 19.51m 5.56m 513.5 g/t Au
YJ04-07 48.85m to 54.45m 5.6m 40.1 g/t Au
including: 53.95m to 54.45m 0.5m 588.9 g/t Au
TW05-02 10.67m to 12.79m 2.12m 853.0 g/t Au
including: 10.67m to 11.58m 0.91m 2,397 g/t Au
TW05-02 20.05m to 41.50m 21.45m 11.5 g/t Au

The general area encompassed by drilling covers approximately 300 metres x 100 metres, with the deepest mineralized intersection encountered at 140 metres. The deposit appears to be open along strike in both directions and to depth.

Gold Mine Capitalization

The Yellowjacket Zone coarse gold mineralization has a pronounced “nugget effect” where adjacent samples within the same mineralized zone can have widely varying gold values. This prompted Prize in 2006 to proceed with a bulk-sampling program in order to evaluate the deposit in an economic framework. Prize engaged a number of prominent engineering, metallurgical and environmental consultants to carry out permitting, pit design, mill design and fabrication work. Regular consultation was made with the Taku River Tlingit First Nation (“TRTFN”).

By the summer of 2008 there had been approximately $14 million spent to capitalize the Yellowjacket gold mine which brought the project to the stage of producing gold under a bulk sampling permit.

Further Capitalization

In July 2009 a Small Mines Permit was obtained and an additional $3.5 million was invested in the mining infrastructure of the project to reflect the increased capacity of the Small Mines Permit. These investments would ultimately lead to 100% acquisition and the eventual spin-off into Yellowjacket Resources Ltd. (which subsequently become Athabasca Nuclear Corp.)

Total mine related capitalization through to 2011 is approximately $17.5 million.

Mine Permitting

The project received a Small Mines Act Permit in July 2009 for the development and production of gold from the British Columbia Ministry of Energy, Mines and Petroleum Resources. The Permit allows for the development and operation of an open pit gold mine and onsite concentrator processing up to 75,000 tons per year of ore.

Impact and Benefits Agreement

The local Taku River Tlingit First Nation (“TRTFN”) were active participants in the review and approval of the Permit. In October 2009, Eagle Plains and Prize announced the formal ratification of an Impact and Benefits Agreement with the Taku River Tlingit First Nation. The Agreement recognizes that the Yellowjacket Project is located within the TRTFN Territory; and the YJV holds certain interests and rights granted by British Columbia to extract gold resources. Furthermore, the parties recognize that they have a mutual and beneficial interest in cooperating with each other to advance and complete the Yellowjacket Project in a timely, environmentally responsible and orderly manner.

2009 Mining Operations

Commissioning and test work on the mill facility was completed in June 2009 and stockpiled material from 2008 bulk sample work was processed for approximately two weeks. Excavation activity and expansion of the existing pit took place from mid-August to mid-September. Approximately 40,000 tonnes of material was mined, with approximately 9,000 tonnes of material stockpiled for processing. Overall production was severely constrained by numerous breakdowns, equipment failures and permitting delays. Although some doré was produced onsite, the smelting furnace was not efficient which led to a decision to process the bulk of the concentrate offsite.

2007 & 2008 Gold Production

Placer Production

In 2007, Prize reported production of 6.43 kilograms (206.9 ounces) of gold produced from sluicing the placer-bedrock interface material excavated during bulk sample excavation.

Hard Rock Production

In 2008, Prize processed 4200 tonnes of bedrock material in their onsite bulk sample mill. Of this material, 2880 tonnes were considered to be taken from the main mineralized zone and returned gold bars totaling 18.63 kilograms (599 ounces). About 800 kilograms of low grade gold concentrates from 2008 remain and are estimated to contain approximately 1.5 kilograms (50 ounces) of gold. These gold volumes back-calculate, using a formula that allows for smelting and processing plant recoveries, to a head grade of approximately 9 g/t gold. Test work done on the rock units excavated from the pit have found them to be non-acid generating. The success of the bulk sampling program led Eagle Plains (as project operator) to apply for a Small Mines Act Permit for continued excavation and milling at the Yellowjacket Gold Zone.

Future Exploration

The Yellowjacket Gold Project has a current NI43-101 Technical report prepared by Barry Price, P,Geo. Based on the results of the exploration and development conducted to date on the Property, the report concludes that the Yellowjacket Gold Zone represents a legitimate development target with the potential to host an economically feasible mineral deposit. The report also states that additional zones on the Property are legitimate early stage exploration targets and recommends further exploration. Currently the Yellowjacket Zone is open along strike in both directions and to depth. Management intends to continue with exploration of the project, which will include drilling.

Dam Safety Inspection Report

In November 2014, Athabasca Nuclear submitted a Dam Safety Report (DSI) for the Yellowjacket Gold Project to the Government of British Columbia, who required all permitted mine projects to conduct a DSI. The Report was prepared by Tetra Tech, a leading engineering firm with over 330 offices worldwide. The complete report may be read by clicking here.

History of the Yellowjacket Property

The Yellowjacket Property has a rich history. Gold was discovered in the Atlin area by prospectors using the Overland Trail from Edmonton, Alberta enroute to the Klondike in 1898. The ensuing gold rush lasted several years, and although many creeks in the area produced “colour,” Pine Creek became the epicenter of this rush. It was placer mined coincidently with the Klondike by the same adventurers who sought the riches of the Northand wished to escape the confines of society. Pine Creek proved to be much easier to access than Dawson City and soon attracted fortune hunters disembarking their ships at Skagway and Dyea, Alaska. The current Yellowjacket site once hosted up to 10,000 people, mostly placer miners, in a city of cabins located along Pine Creek called Discovery; to compare, the Klondike at the height of it’s gold rush was home for up to 30,000 people.

Approximately 1 million ounces of placer was recorded as being produced by the area and it is presumed that several more millions of ounces may have been recovered that were not recorded. The area underwent the same transition as the Klondike with the minions of individual placer miners eventually being replaced by corporations who had consolidated their claims. These corporations in turn employed large work forces to operate behemoth dredges that processed the gold bearing gravels as they floated on sloughs created by damming Pine Creek. This transition marked the end of the heyday; the era of the Canadian gold rush had come to a close.

Today few remnants remain. Weary windowless cabins lean heavily as a testiment to the northern winter weight. Near Atlin, a small cemetery hosts those who succumbed while seeking these riches, their epitaph inscribed on weathered wooden plaques and crooked crosses. In the town of Altin, a museum diplays photos of those who toiled for gold and some of the machinery they employed to pursue these dreams.

Updated June 19, 2013

 
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