A junior exploration company — TerraX Minerals — hopes to bring a new era of gold mining to Yellowknife.

The last gold mine close to the city shut down almost a decade ago, and exploration in the Yellowknife gold belt has been stagnant, until now.

In February, TerraX has acquired a site along the lucrative belt, located about 15 kilometres from Yellowknife.

The Northbelt site is about 13 kilometres in length and 36 square kilometres in size, and sits just north the Giant Mine. It once belonged to Royal Oak, the last company to run Giant Mine.

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Joe Campbell, from TerraX Minerals, said the property is one of the most promising expansions of mineralization that was mined in the past. (CBC)

"It's the most promising expansion of mineralization that was mined in the past," said company president Joe Campbell.

TerraX Minerals is starting a small exploration program this summer. It's doing geological surveys and combing through old drilling records. 

But down the road, a big hurdle could be selling a project that neighbours one of the most toxic mine sites in Canada. 

Historic contamination

The federal government is spending almost a billion dollars to clean up the Giant Mine and store 237,000 tonnes of arsenic trioxide, dust produced during gold production.

"Anyone that mentions gold mining in Yellowknife is obviously going to associate it with the gold mining that occurred in the past, and therefore the question that will come out is, 'is this going to be another environmental disaster in 40 years like Giant'," said Campbell.

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Investors hope the project can revive Yellowknife's gold mining economy.

Yellowknife prospector Walt Humphries says building another mine close to town doesn't mean more contamination to the already heavily contaminated Giant Mine site.

"I wouldn't say don't explore in the Yellowknife area because Giant had a lot of arsenal pyrite, because several of the other mines didn't. You have to find the deposit first before you can make that judgment," he said.

Humphries says with the NWT's diamond mines winding down, now is a good time to explore for minerals that could help keep the economy going.

Campbell said the only way to address environmental concerns is with communication.

"Talk to people and try to get them to understand that operations are different today."

Campbell said no modern mining companies treat ore the way Giant Mine treated it when that mine was developed in the 40s.

Also, Campbell says previous exploration samples show mineralization in the Northbelt property has a lower arsenic content than the ore which was mined at Giant.

Campbell said if their exploration work is successful, a mine close to Yellowknife would be a boon for the city, as well as for the nearby communities of Ndilo and Dettah.

"Most other operations in northern Canada are fly-in, fly-out operations where you are removed from where you live. This would be an opportunity to work in an environment where you go home at the end of the day."