The Arctos (Lost-Fox) occurrence is located on Lost Ridge between the Little Klappan River and Didene Creek.
The anthracite deposits at the Lost-Fox prospect are part of the Klappan area of the Groundhog Coalfield near the north end of the Bowser Basin of British Columbia. The Bowser Basin was filled with sediments deposited from eroding mountains during the late Jurassic and early Cretaceous. At the northern end of the basin, peat formation occurred in deltaic environments. These peat bogs were metamorphosed to form the coal-bearing sequences of the Groundhog Coalfield, an oblong (30 by 80 kilometres) area extending southeastwards from the headwaters of the Klappan and Little Klappan rivers to Groundhog Mountain in the Skeena Ranges, an area characterized by mountainous terrain with broad valleys.
The coal-bearing sequences of the Groundhog Coalfield reach approximately 1100 metres in thickness, with 33 identified coal horizons of up to 11.8 metres in true thickness interbedded with primarily mudstone, siltstone and sandstone. The coal-bearing units and surrounding beds were later deformed by compression that created open to tight folds that are near vertical to overturned to the northeast. Fold axes strike 030 to 060 degrees and axial planes dip 25 to 85 degrees southwest. The folds are cut by thrust faults striking 020 to 040 degrees and dipping 10 to 25 degrees southwest. The whole area is cut by younger high-angle faults trending northwest, north and northeast.
Coal rank in the Groundhog Coalfield varies from semi-anthracite to anthracite; coalification proceeded to the extent that coking and agglomerating properties of the coal are severely reduced. However, anthracite has high heat value and is used in metallurgical processes such as sintering pulverized coal injection (PCI). It is also used in filter media, briquettes, and in coal gasification.
Coal exploration in the Groundhog Coalfield of the Skeena Mountains began in 1903 with intensive prospecting, surveying, trenching and drifting on coal exposures in the southeast part of the Groundhog coalfield on mapsheet 104A. In 1948, Buckham and Latour of the Geological Survey of Canada conducted mapping and data collection and documented 192 coal occurrences (Geological Survey of Canada Bulletin 16).
Mount Klappan is in the northwest part of the Groundhog Coalfield on mapsheet 104H and hosts several prospects. Interest in the potential of the Mount Klappan area began in 1979. Esso conducted a field program in the summer of 1979 consisting of mapping and sampling on areas around Hobbit Creek and Lost Ridge.
Gulf Canada conducted exploration at the Mount Klappan Project in the 1980s, including the Lost, Fox, Summit, Hobbit-Broatch, Nass and Skeena areas. In total, Gulf drilled over 24,860 metres of diamond drilling in 159 holes, 1517 metres of rotary drilling in 23 holes, 1669 metres of hand trenching, 2047 metres of mechanical trenching, detailed geological mapping, 64 measured sections and two exploration adits (Coal Assessment Report 740). The majority of this work was focused on the Lost-Fox area. An 119,000 tonne bulk sample was mined from the I seam in an open pit at Lost Ridge over the winter of 1986-87. It was processed at an on-site temporary wash-plant along with a smaller bulk sample (21,000 tonnes) from a pit opened the previous winter at the Hobbit-Broatch prospect. A clean product of 80,000 tonnes of anthracite was produced and shipped in 1986 (Mining in British Columbia 1981-1985).
In the 1990s, Gulf completed several iterations of preliminary assessments, pre-feasibility and feasibility studies on the project. Over 20 years, Gulf Canada spent about $65 million in the Mount Klappan area.
The Lost-Fox prospect consists of multiple seams exposed along Lost Ridge and Fox Creek and also inferred to underlie the gentle southeast-facing slope between these two topographic features. Work completed at the Lost-Fox prospect between 1981 and 1988 included two adits, 148 diamond-drill holes for a total of 23,073 metres, 23 rotary-drill holes for a total of 1517 metres, 2676 metres of hand and mechanical trenching, detailed geological mapping, and a 200,000 tonne bulk sample mined over the winter of 1985-86.
Seams A through P have been identified at the Lost-Fox prospect. Principal seams are E, F, G Lower, H, K, K/L, L, M, M/N, N and O. The true thickness of the coal in 36 seams in the Lost-Fox area is 39.96 metres (Coal Assessment Report 740). Seam thicknesses vary from 1.5 to 5.2 metres and average 3.6 metres (Coal Assessment Report 110).
Samples collected from Lost Ridge and Fox Creek (Coal Assessment Report 109) gave the following range of coal quality values:
--------------------------------------------------------------------- Lost Ridge Fox Creek Low High Average Low High Average Fixed carbon 42.70 88.40 73.50 55.00 74.20 65.90 Ash content 4.90 48.30 17.50 19.70 40.00 27.40 Volatile matter 5.90 14.70 9.10 5.00 8.50 6.60 Sulphur content 0.29 0.66 0.50 0.44 1.11 0.65 Calorific value 3114.00 7 782.00 6477.00 4566.00 6301.00 5688.00 ---------------------------------------------------------------------- |
The above values are based on raw coal and are stated in per cent except for calorific values which are in calories per gram. Coal rank, based on the fixed carbon to ash content ratio, is generally semi-anthracite but varies from low volatile bituminous through to anthracite.
Combined (measured, indicated and inferred) resources in the Lost-Fox were calculated as 194.1 million tonnes in 1984 with a further speculative resource of 794.9 million tonnes (Gulf Canada Resources Inc. Geological Report, January 1985).
Conoco acquired the property through acquisition of Gulf Canada in 2001. Fortune Minerals Limited acquired the property in July 2002 from Conoco, and reported new resource figures based on the earlier work by Gulf Canada Properties Limited (Press Release - Fortune Minerals Ltd., July 12, 2002). In July 2004, Fortune contracted Marston Canada to prepare a feasibility study for production of anthracite from the Lost-Fox area based on exploration data from the Gulf Canada projects of the 1980s.
Shell Canada drilled several coalbed gas exploration wells in the Klappan area in 2004.
In 2005, Fortune Minerals conducted a drilling program on the Lost-Fox prospect consisting of 14 holes totaling 653 metres of HQ diamond drilling for exploration, waste dump condemnation, groundwater testing, and geotechnical purposes. The program included sampling for proximate and ultimate analysis and samples for washability analysis were collected from the two major seams H and I.
Measured and indicated resource estimates were developed applying Geological Survey of Canada 88-21 standards required for the Moderate and Complex areas of the Lost-Fox prospect. In 2011, Fortune Minerals released National Instrument (NI) 43-101 compliant Technical Report by Marston, reporting measured and indicated resources of 143.3 million tonnes, and 15.7 million tonnes of inferred resources.
In 2010, Fortune Minerals conducted in-house investigations of transportation alternatives, comparing the partially complete Dease Lake Line railway infrastructure against the trucking route to Stewart. The All Rail Option was favoured over the All Trucking Option. Marston prepared an update to the 2005 Lost-Fox area feasibility study in 2010 (released March 31, 2011), using the All Rail Option in feasibility calculations.
In July 2011, Fortune Minerals Limited agreed to form a joint venture with POSCO Canada and its wholly-owned subsidiary, POSCO Klappan Coal Ltd., to advance the Mount Klappan project to production. POSCAN's parent company, POSCO, is based in South Korea and is one of the world's largest steel producers. POSCO acquired 20 per cent interest in Mount Klappan.
The nomenclature of the coal-bearing rock units in the Mount Klappan area has a complex history. It has been variously referred to as the Currier Formation (Bustin and Moffat, Canadian Society of Petroleum Geologists Bulletin 1983; Macleod and Hills, Canadian Journal of Earth Sciences 1990), the Groundhog-Gunanoot facies (Eisbacher, Geological Survey of Canada Paper 73-33), the Gunanoot Assemblage (Richards and Gilchrist, Geological Survey of Canada Paper 79-1B), and the Groundhog-Gunanoot Assemblage (Evenchick and Thorkelson, Geological Survey of Canada Bulletin 577, 2005). Gulf Canada referred to the coal-bearing unit as the Klappan Series during their exploration programs in the 1980s (Coal Exploration Report 740). Evenchick and Thorkelson (Geological Survey of Canada Bulletin 577) provide a history of stratigraphic nomenclature in the coalfield, and a discussion of the debate over the age of the coal-bearing unit, which they refer to as the Groundhog-Gunanoot assemblage. The age is not well-constrained, and may vary by area; however, it is mainly between latest Jurassic and late Early Cretaceous.
In August 2012, Fortune Minerals and Posco Canada renamed the Mount Klappan project as the Arctos Anthracite Project. Fortune Minerals began the British Columbia Environmental Assessment application process and completed a Definitive Feasibility Study in October 2012. In 2013, environmental, geotechnical, archaeological, and hydrogeological studies were conducted in the Lost-Fox area. Seventeen drill holes were completed and another 2 were started but not finished. Only limited groundwork was completed in 2014.
Fortune Minerals reports a collective 231 million tonnes of measured and indicated resources and 359 million tonnes inferred resources across the Arctos Anthracite Project (Fortune Minerals Ltd 2011 Annual Review). Within the Lost-Fox area, Run-of-Mine proven plus probable reserves total 124.9 million tonnes equating to 10 per cent ash product totaling 69.2 million tonnes (Technical Report on the 2012 Update of the Arctos Anthracite Project Mine Feasibility Study, Nov. 2012).
