Slump in exploration activity in Sioux Lookout.

• Author: McDougall, Douglas
• Position: Sioux Lookout, Ontario - Gold Mining Report

Slump in exploration activity in Sioux Lookout

What started out as the continuation of a four-year trend of active gold exploration and production in the Sioux Lookout mining district ended abruptly during the second quarter of last year.

Exploration activity in the area is about one-third of what it has been in the previous four years, says resident geologist Don James.

According to his report, during the final three quarters of 1989 and the start of 1990 the end of flow-through financing for the mineral exploration industry resulted in a slowdown in activity for the area.

Up to the time the flow-through program was cancelled, during the spring of 1989, exploration activity was "running full-bore," said James. "Now it is about 50 per cent of what it was just last year."

Although the level of exploration in the area has dropped off from the previous four years, it is still equal to the 10-year average.

"I think for the remainder of this year, we will see things continue along the way they are now," commented James.

The slump in exploration activity in the Sioux Lookout district is being attributed to the inability of junior mining firms to locate funding for new and existing programs.

The report states that junior mining firms were responsible for half of the exploration activity in the area last year. James reported that their share has slumped to approximately one-third.

At present the largest gold exploration activities are being carried out by Placer Dome Inc. at the Musselwhite Mine north of Pickle Lake. Placer Dome is the major player in this joint venture with Inco Gold and Lacana Mining (Corona).

Currently on hold due to a lack of hydroelectricity and road access to the site, the Musselwhite project has a substantial enough deposit to warrant further drilling throughout the summer.

Placer Dome completed evaluation of the East Bay gold zones in March of 1989. The project included the sinking of a 235-metre shaft, approximately 1,800 metres of drifting, underground diamond drilling, a bulk sample and surface diamond drilling.

Bulk sampling indicated reserves of 7.4 million tons at .2 ounces of gold per ton. In addition, another zone is estimated at 3.4 million tons grading at .15 ounces per ton.

The Musselwhite property is located on the south shore of Opapimiskan Lake, with Moss-Power Resources holding the other three shorelines.

Harry Hodge, president of Moss-Power, says $1 million will be spent on definition and surface work this...