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SOMBA K'E/YELLOWKNIFE - With a significant increase in resources at its Yellowknife Gold Project in the wake of recent drilling, Tyhee Development Corp. is beginning work on a pre-feasibility study for the future mine located 90 km north of Yellowknife.

Val Pratico, chief geologist for Tyhee Development Corp., works on the company's Clan Lake property, south of the Yellowknife Gold Deposit. - photo courtesy of Tyhee Development Corp.

Drilling at the site this spring has increased the total estimated amount of gold to 1.6 million ounces - up from 324,000 ounces in the previous estimate.

"We had drilled a lot in 2007 but we were missing a gap, so we had to wait until the swamp was solidly frozen to get those holes drilled," said David Webb, president and CEO of Tyhee.

The Yellowknife Gold Project comprises three deposits: Ormsby, which accounts for 75 per cent of the resources and where 350 holes have been drilled so far, Nicholas Lake (150 holes drilled; 20 per cent of the resources) and Bruce Lake (50 holes and five per cent of the resources).

The promising resource estimate means the project can now begin work on a pre-feasibility study. But Tyhee is not eager to publicize that, concerned that such announcements will bring with them a host of expectations from possible stakeholders.

"If I say we're doing a pre-feasibility study, the next question is, 'OK, when will that be finished?' I don't have an answer for that," said Webb.

Instead, the company will, like most other companies, conduct work on a pre-feasibility study (which includes cost estimates for building the mine, as well as a revised mine life) and, when it's fairly certain of the results, move into a feasibility study and only then publish the results, said Webb.

"The industry standard approach - that's what we're doing," he said.

But there are some aspects of the project, albeit tentative in nature, that Webb can talk about.

He estimated the Yellowknife Gold Project, which will begin as an open-pit mine before phasing underground as well, will have a mine life of at least seven years. Not even Con Mine and Giant Mine, both of which operated for far longer than seven years, had a reserve base of two million ounces.

Webb said between 160 and 200 full-time workers will be needed to work the mine and double that number will be needed for actual construction of the mine.

A baseline environmental study was submitted to the Mackenzie Land and Water Board last year, and when the company decided to make the project a combination open pit-underground mine, it re-submitted the study again.

This past summer, the company did a lot of environmental work on site, collecting numerous water samples.

Webb estimated 75 per cent of the staff on site came from Yellowknife, Dettah, Ndilo, Tulita and Behchoko.

He said getting people from the affected communities - namely Yellowknife, Dettah and Ndilo - proved difficult.

"We cannot get the people we need from the affected communities right now. They're just not available."