Brian Briggs, Tyhee Gold Corp.’s president and Chief Executive Officer laughs when he’s told that building a mine in the Canadian north is tough.
“I’ve worked on mines in Africa where my wife and I lived in a 20-foot shipping container for months on end and where it took weeks, even months, to get a critical part delivered. After that, this is going to be easy… Well, almost easy,” he laughs.
Briggs is talking about Tyhee’s vision of taking the company’s Yellowknife Gold Project, and building the next new gold mine in the Northwest Territories, one of Canada’s oldest and most prolific gold districts.
“Given that Tyhee is a junior developer, we are fortunate to have a management team that is already heavily weighted towards operations and development. Typically, a company at Tyhee’s stage of development is frantically looking for experienced people to construct and operate the mine, particularly people familiar with working in the far north,” he explains.
The roots of Tyhee’s Yellowknife Gold Project began in 2001 when the predecessor company, Tyhee Development Corp., purchased the old Discovery Mine property from GMD Resource Corp. Back in the summer of 1944, prospector A.V. (Fred) Giauque had spotted visible gold in quartz veins in rusty mafic volcanic rocks near the west shore of the since-named Giauque Lake, 90 kilometres north of Yellowknife. The next year, he optioned the claims to Discovery Yellowknife Mines Limited, which quickly began developing both a mine and the company town of Discovery. Gold production began in January 1950 and, two years later that company was renamed Consolidated Discovery Yellowknife Gold Mines Limited. As more gold was found, the mining operation was steadily expanded. The Discovery Mine produced more than one million ounces of gold from almost a million tonnes of ore before it was closed in 1969 following a fire that had destroyed the mill, making it one of the richest and highest grade gold mines in the NWT.
While further surface exploration and diamond drilling continued intermittently and a number of related claims changed hands over the next 32 years, Tyhee’s management, led by Dr. David Webb, recognized the tremendous potential not only for the site, but also for the district.
Following the acquisition of the Discovery site, Tyhee purchased or staked more land, accumulating a total of 35,085 acres of what is generally recognized as the most prospective land between Discovery and all along the trend to Yellowknife. In the past dozen years, the company has conducted extensive exploration work on its land position, although Val Pratico, Tyhee’s head geologist, estimates that less than 10 per cent has been tested in any serious way. Still, that work has turned up at least 17 gold showings thus far.
Meanwhile, the largest portion of Tyhee’s focus has been on what has come to be known as the Ormsby deposit, which is contiguous to the now dormant Discovery mine workings. Some 122,000 metres of drilling in 510 diamond drill holes have provided enough positive results to support the company’s independent positive Feasibility Study (FS), which is the detailed basis Tyhee will be using to develop the mine, starting with an open pit at Ormsby. This FS provided Tyhee with the economic and technical framework supporting an operation that would produce approximately 100,000 ounces of gold per year during the first eight full years of production, beginning in 2016.
Given the particularly challenging times that virtually the entire junior resource market is facing, the keys to Tyhee’s near term success lie with two critical path items – financing and permitting.
Along with virtually every other resource junior, Tyhee is facing unusually difficult capital markets. However, the company has continued to move ahead due to the particularly strong support of its loyal shareholder base, as well as its deeply invested board of directors, a status that Briggs is confident will continue for the foreseeable future.
On the permitting side, Tyhee’s technical team has been working on an updated Project Description, as well as on responses to Information Requests (IRs) received from interested parties, and the Mackenzie Valley Environmental Impact Review Board (MVEIRB). Tyhee expects to file this information with the MVEIRB in 2014.
Following receipt of this information, Tyhee expects the MVEIRB to convene technical sessions to discuss Tyhee’s responses, where a second round of IR’s may be required.
The company hopes to be through the environmental assessment process next year before moving into the regulatory phase in preparation for final permitting.
Meanwhile, Tyhee has also been working closely on the development and operation of the project with the affected First Nations, who have offered their broad support. A key next step will be the conclusion of a formal agreement that defines the key benefits the project will provide these communities.
“My entire team is dedicated to this project,” says Briggs. “It’s been a long time in the making and the markets are providing tremendous challenges, but history has shown us repeatedly that this too will change. When it does, we’re going to be ready. This is a worthwhile endeavour and once it gets going, it is going to keep going for decades.”