Walt Humphries staked his first claims near Yellowknife forty years ago. He's been working them ever since, adding other claims over the years. Two weeks ago he made a deal with a junior mining company that had land just west of his property at Walsh and Banting Lakes.
Humphries’ deal, with the Vancouver-based junior mining company Terra X, marks the first time in years since prospectors in the Northwest Territories have found a junior mining company to invest in their property.
“This is a good sign, that there's someone interested in the area and hopefully things will turn around,” Humphries says. “A prospector lives in hope.”
Global companies such as Rio Tinto and BHP Billiton build the mines that are the economic engines of the Northwest Territories, but all of those mines began with prospectors walking alone over ground, hammering at rocks and staking claims.
The deal means Terra X will do the exploration work required to keep the claims active for the next four years. If after that, they want to mine the ground, Terra X will get the mineral rights, and Humphries will get a percentage of the value of any gold they mine. If the company doesn’t have any interest in mining after four years, Humphries gets the property back.
“I've optioned most of the ground once before,” Humphries says. “It was worked on for about 10 to 15 years. Unfortunately, that company went bankrupt. It took me 10 years to get the property back, and I've had it for the last 10 years, shopping it around.”
Terra X President Joe Campbell says the addition will make his project more attractive to investors at a time when it's very difficult to raise exploration money.
“One of the things they will look at is the size of the project,” Campbell says of investors. “The more area you have to explore in, the better chance you have of making a discovery. With the addition of Walt's property and the other one we purchased, we've essentially doubled the size of the area we have to explore.”
Over the last year the junior mining company's stock has risen from 10 cents a share to about 50 cents.
“The biggest jump came when we announced we had found a couple of hundred drill holes of core that had been stored at the Giant.” Campbell says. “So, people who are knowledgeable in the industry immediately understand the value of that material. You're talking about millions of dollars of exploration value that suddenly appears in front of you.”
The company has reported favourable results from analysis of the historical drill cores.
It plans to begin doing its own drilling program early next year.