The Fort Knox Gold Hunt
The Fort Knox Gold Hunt
Born in 1858 in Italy, Felice Pedroni became a gold prospector in the Klondike and interior of Alaska. Adopting the name Felix Pedro, he discovered
Born in 1858 in Italy, Felice Pedroni became a gold prospector in the Klondike and interior of Alaska. Adopting the name Felix Pedro, he discovered gold on July 22, 1902, near Fairbanks. Rather than staking his claim right away, Pedro gathered friends for a collective effort, sparking the Fairbanks gold rush. Pedro's health declined after his significant contribution, and he passed away in Fairbanks on July 22, 1910, eight years post-discovery. Between 1902 and 1990, over 8 Moz of mostly placer gold were mined in the district.
In 1984, a geologist discovered visible gold in quartz veins on the Fort Knox property. Bob Nye brought the land to Fairbanks Gold, controlled by Robert & Eric Friedland, which acquired 51% of the project. Monte Cristo Mining & Gilmore Mining also controlled part of the project. To meet claim block assessment requirements, Fairbanks decided to build a road, intersecting a gold-bearing quartz monzonite intrusive. The initial drill holes yielded promising results incl 61 meters @ 1.37 g/t Au.
In 1989, Fairbanks conducted a public offering and continued drilling on Fort Knox. Initially facing a lack of investor interest, it gained momentum after step-out holes significantly expanded the mineralized zone. One drill hole hit 213 meters @ 3.7 g/t Au, with the bottom 38 meters yielding 8.78 g/t Au.
By the close of 1989, Fairbanks Gold and its JV partners spent $4.5M on exploration, revealing an area with 4 Moz of gold through extensive drilling and trenching. Fairbanks' stock reached a $80M valuation by the end of 1989 (for 50% of the project). In 1990, extensive drilling and a bulk sample confirmed 5-6 Moz, with a pre-feasibility study projecting annual production of 350 Koz for 16 years.
In late 1991, Amax Gold, a 350,000-ounce-per-annum gold producer, expressed intent to acquire Fairbanks Gold's assets for US$150M, offering 1 Amax Gold share for every 2 Fairbanks shares. Robert Friedland and Ivanhoe Capital, holding a 35% stake, agreed to tender their shares. Amax Gold also issued 6.3M shares and 630K warrants to acquire Gilmore Gold from the US, securing the remaining 49% interest in Fort Knox.
Mine construction started in 1995, with 800 workers completing the power line, freshwater and tailings dam, crusher, coarse-ore conveyor, and mill components by 1996. Commercial production commenced on March 1, 1997.
In early 1998, Kinross Gold announced a significant merger with Amax Gold, forming the 5th largest gold producer in North America. The new company would produce 1.2 Moz per annum with a Mcap of around $1.5 Billion.
Over the years, gold production remained stable at 350Koz per year. In 2020, Kinross acquired a 70% interest in the Manh Choh project, operated by Contango Ore, 400 km southeast of Fort Knox. Production is set to begin in 2024, with ore processed at Fort Knox.
This year the total production will likely surpass 9 Moz. Fort Knox is the largest producer of gold in the history of Alaska.