The Kaminak Gold Corporation's Coffee project south of Dawson City could help revive Yukon's slumping mining industry, according to renowned Klondike prospector Shawn Ryan.
RyanWood Exploration, the company owned by Ryan and his wife Cathy Wood, did the initial prospecting on the Coffee property that led to the discovery of gold. Kaminak later acquired the claims from RyanWood.
"Their first drill hole, based on our data, basically was a home run, they hit it right away," Ryan said.
Kaminak said this week that a feasibility study into its Coffee Gold project south of Dawson City shows a proposed mine at the site could easily turn a profit.
Company president Eira Thomas called the Coffee property "one of the world's best undeveloped gold projects by value and margin, that works in the current gold-price environment."
Kaminak is proposing an open pit mine at the site 130 kilometres south of Dawson. According to the company, the 10-year project would generate more than $2 billion in gross revenues, and employ close to 500 people.
"We got a winner"
"This was what we needed," said Ryan.
"The whole Yukon needed this because we needed a winner to come through the gate. You could push all you want, but if you have no winners then the dust settles. But now we got a winner, and all it takes is one," he said.
RyanWood is entitled to a two per cent royalty on the mine's revenue, Ryan said. Typically, a mining company buys back half of that, leaving the prospector with one per cent, he said, but added that's not what's important.
"To me the big beauty and the bonus is [to] the people of Dawson — the road's going to start right from there. It's going to work its way to the project."
Ryan said the people at Kaminak deserve a lot of praise for bringing the project to this point. He's not sure if another company could have done the same.
Kaminak intends to have its permitting applications ready to submit to the Yukon Environmental and Socio-economic Assessment Board (YESAB) by this summer.
Ryan believes a bigger company will likely take over from Kaminak, or the Vancouver-based junior will find investors to finance the mine development. Kaminak has said it needs $317 million to get the project started.