Barrick (TSX: ABX) (NYSE: GOLD) and Japan Gold (TSX-V: JG) are moving forward with exploration activities in the Asian country’s Kitami Region, as part of the joint venture partners efforts to uncover the nation’s gold mining potential.
Under a venture formed in February, known as Barrick Alliance, the companies have completed bulk leach extractable gold (BLEG) and rock chip sampling over eight of the 14 targets located in southern Kyushu epithermal gold province.
Barrick Alliance field teams relocated from southern Kyushu to northeast Hokkaido, Japan’s second largest island, in late July. They are currently undertaking regional sampling on Sanru, Japan Gold’s largest project, which is included in the country-wide alliance with the Canadian gold giant.
Sanru is Japan Gold’s largest project and covers a 25-km-long strike length on the Omu-Kamikawa trend in Hokkaido, one of Japan’s major epithermal gold provinces.
The Sanru area covers a 25-km strike length from the Sanru mine in the southwest to the boundary of Irving Resources’ Omu project.
The Kitami Region is one of Japan’s major epithermal gold provinces with more than 40 historic mines and prospects. The area is home to the Konomai mine, the country’s third largest gold operation, with historic production of 2.35Moz at an average grade of 6.4g/t Au.
It also holds the past-producing Sanru mine, with churned out of 225,000 ounces of gold at an average grade of 7.4g/t Au over its mine life.
Japan Gold has nine projects with applications and prospecting rights covering 737 km2 of prospective ground within the region, eight of which are included in the Barrick Alliance.
The regional exploration program, initiated in May, will help the alliance evaluate the joint venture’s overall portfolio. From there, both companies will determine which areas have anomalous gold showings and potentially fertile large structures.
Barrick has committed to solely fund a two-year initial evaluation phase of 28 out of 30 projects Japan Gold already has in the country.
The Canadian gold giant will also finance a third year of exploration on assets that meet its criteria.
Once the Toronto-based miner completes a pre-feasibility study (PFS), it will earn a 51% interest and may choose to fund a designated project to a bankable feasibility study (BFS). The completion of a BFS will fully carry Japan Gold and earn Barrick a 75% interest in the project after which Japan Gold will retain a 25% interest.
Gold-rich area
Japan Gold has recently expanded its portfolio to reach a total of 30 projects. These cover more than 40 historic gold mines over an area of approximately 1,900 square km, spread across the country’s three largest islands: Hokkaido, Honshu and Kyushu.
The company’s southernmost projects are found on Kyushu Island, where it has 16 gold projects in the area of the Hishikari mine. The asset has been producing since 1985, generating 7.9 million ounces so far at average grades of 30-40 g/t, making it one of the highest-grade deposits under active mining globally.
Japan Gold has attracted interest from other majors, including Newmont (NYSE: NEM) (TSX: NGT), which has a 13% stake in the Vancouver-based junior.
The world’s no. 1 gold producer became involved with Japan Gold in 2018, when Goldcorp (now part of Newmont) provided financing. As part of the deal, Goldcorp was granted a joint venture right of first refusal on two projects, the Ohra-Takamine and the Ikutahara project.
Those assets are excluded from the Barrick Gold strategic alliance.
