Gambling at its finest.

• Author: Stricker, Julie
• Position: Junior mining companies in Alaska

Junior mining companies search Alaska's hills and hollows in hopes of finding heaps of gold. When they do, a hook is set that is sure to snag major mining companies and financial backing.

The little guys are making big discoveries in Alaska's gold fields. True North, Pogo and the Bonnifield District are three of the most promising mineral prospects in Interior Alaska today, with millions of ounces of provable gold reserves. They weren't discovered by one of the big mining firms currently working in Alaska, but by a different category of prospector: a junior mining company.

According to Steve Borell, executive director of the Alaska Miners Association, Alaska's juniors are relatively new firms with incredible depths of experience despite their lean staffs. About three dozen companies are currently doing business in Alaska, the largest of which are Grayd Resource Corp., Golden Phoenix Minerals Inc., La Teko Resources Inc., Ventures Resource, and North Star Explorations. All together, junior mining companies are adding a new dimension to the state's resources industry, Borell says.

It's All About Stock

The juniors are typically listed on the Canada's Vancouver and Toronto stock exchanges and finance their explorations through stock sales. The companies take proceeds from the share sales and seek out properties with known mineralization with the hope of expanding the deposits to the point that one of the larger companies will come in and develop it, thus increasing the value of the company so stockholders will make money. The juniors typically retain a percentage of the operations through joint ventures.

"They're not mining themselves, but are trying to bootstrap themselves onto the bigger operations so they can raise more money for exploration," Borell says.

A textbook example of this process is La Teko Resources' exploration of the True North site, about 15 miles northeast of Fairbanks. The Vancouver, British Columbia-based firm operated the Ryan Lode mine on the western edge of Fairbanks through the 1980s, producing 20,000 ounces of gold. But the company ran out of ready gold reserves and cash, and started looking for another property that would complement its holdings, says Gerry Carlson, La Teko president and CEO.

"Part of the difference is in the way they operate," Borell says. "They need to make public what they're finding. They tell the world about it because they need to raise money. This is opposed to the major companies who would...