On Season 6 of Gold Rush we see Todd Hoffman and his crew returning to McKinnon Creek for the second year in a row, this time with a lofty goal of 2,700 oz of gold for the season. Also for the second year in a row, it appears as though the company that is leasing the McKinnon Creek claim to the Hoffmans has spoiled their season by revealing just how much gold they found!
Just like last year, Klondike Gold Corporation President and CEO Peter Tallman has issued a press release with exactly how much they were paid for the 2015 McKinnon Creek lease. With that information, and given that the lease amount is 20% of all gold recovered on the claim, it’s not difficult to do the math to figure out how much the Hoffmans recovered during the 2015 mining season.
From the press release:
Vancouver, British Columbia, November 3, 2015, Klondike Gold Corp. (“Klondike Gold” or the “Company”) (TSX.V:KG) is pleased to report receipt of $526,994 from the sale of placer gold relating to a production royalty from Klondike Gold’s “McKinnon Creek” placer property.
The McKinnon Creek placer property is currently leased to Jerusalem Mining LLC (“Jerusalem Mining”) in return for a 20% production royalty. The leased McKinnon Creek property is a small parcel within Klondike Gold’s 7 kilometers long by 2 kilometer wide “Indian River” property. These properties are owned 100% by Klondike Gold…
A total cash amount of $526,994 has been received by Klondike Gold due from the 2015 production royalty. This amount is net of Yukon production taxes, payment of an underlying 5% royalty to 19651 Yukon Inc., processing, fees, and other charges.
“The non-core Indian River placer asset has been turned around in the past two years into a cash-generating property with significant and increasing revenues of $0.5 million in 2015, following $0.2 million in 2014,” Tallman boasts. “Leasing Indian River has allowed the Company to focus on making significant bedrock gold discoveries on its core quartz claims underlying the western half of the Klondike goldfields.”
So what do those numbers mean exactly? One dedicated Gold Rush fan (or perhaps a dedicated Gold Rush detractor) shared her math on the Gold Rush Alaska Gossip Facebook page:
Okay, KG’s reported sale of royalty gold netted them $526,994 (Canadian$)
Converting CDN to USD at today’s rate makes it $396,072.
That would be 344 ounces of pure gold at an assumed value of $1150.
If the actual placer gold was 80% fine, that would be about 430 raw ounces.
KG’s cut was 15%, with 5% going to the “underlying claim owner”.
So, 430 ounces was 15% of what Todd supposedly recovered, making Todd’s haul for 2015 about 2867 ounces.
So it looks like yet another example of a Gold Rush crew just barely making their goal! (No wonder Todd has been gloating on social media for the last couple of months!) I’m sure it will all come down to the season finale when Jack Hoffman comes back out of the cleaning room with his jars of gold as the rest of the fellers wait around a campfire anxiously… I confess that I will be there watching. 😉
New episodes of Gold Rush air Friday nights at 9/8c on Discovery.