Freegold Ventures has announced that Australian mining firm South32 will provide a minimum of $2m funding, towards the expenditures for the Year Two exploration programme at Shorty Creek porphyry copper project.

The Shorty Creek project is located approximately 125km northwest of Fairbanks, Alaska and 4km to the south of the abandoned mining town of Livengood and the all-weather paved Elliott Highway.

In the Year One exploration programme, carried out in 2019, the company has drilled a total of 1,542m (5 holes) and has completed 100km of induced polarisation, along with 98km of ground magnetic surveys.

Freegold’s 2020 exploration program includes additional drilling at Shorty Creek Project

South32, through its subsidiary, has provided funding for the 2019 exploration programme, under an agreement pursuant to which, South32 holds an option to earn 70% interest in the project.

To maintain the option, South32 has to provide a minimum funding of $10m for exploration over an option period of 4 years, where the minimum exploration expenditure will be $2m for the first two years each, and $3m for third and fourth years, for an average of $10m.

In addition, South32 has an option to subscribe for 70% shares of the newly formed project company by offering $30m, less the amount of exploration expenditure contributed by South32 during the option period following the completion of each annual program.

Freegold will serve as the operator for Shorty Creek project during the option period.

It has identified significant porphyry potential at Shorty Creek project in late 2014, and the prospect is said to host a cluster of magnetic anomalies, as seen in porphyry districts.

Freegold stated: “Twelve widely spaced holes previously drilled by Freegold to an average depth of 500 metres expanded the mineralized zone to over a 750 x 400 metre area with each hole intersecting significant and consistent copper, gold, silver and tungsten mineralization over broad widths from base of oxide material (average depth ~90 metres).

“The target remains open both laterally and to depth.”