Is this rock the sign of a new Yellowknife gold mine? (Answer: Maybe.)

A company hoping to start a new gold mine south of Yellowknife is drilling more than two kilometres beneath the surface of an older mine in the hope of showing untapped resources exist.

In a few weeks’ time, Gold Terra expects to receive the results of that drilling – a detailed breakdown of what’s in the rock 2,000 metres below the former Con Mine.

If enough gold shows up in those results, it could mark a major milestone toward reopening a gold mine south of the territorial capital. (Any actual mining would still be years away, and would need to go through the NWT’s regulatory controls first.)

Con Mine was a major gold producer until it closed in 2003. It’s in the final stages of remediation.

The mine’s Robertson shaft, sunk in the 1970s, almost reached the two-kilometre mark. Gold Terra’s drilling has now pushed beyond 2,100 metres – around 6,900 feet – and is still going.

One day, Gold Terra says, it could reopen the Robertson shaft and extend it to get at fresh depths of gold-bearing rock. But only if the company can demonstrate enough gold still exists down there.

Drilling to new depths beneath Con is Gold Terra’s latest effort to attract investment at a time when funding is hard to come by, and the wait for results is an anxious one.

In a core shack next to Yellowknife Airport, samples retrieved from two kilometres underground are laid out for careful examination.

Gold Terra chairman and chief executive Gerald Panneton fusses over the cylindrical and half-moon samples like a protective, proud mother hen. He sees in them the kind of detail that’s only obvious to a trained eye: the exact depth at which ordinary rock turns into the type that could contain gold, and – within that – which visible minerals might hint at a major gold deposit.

“I’m very excited,” he says, pouring water over a section of core sample to point out some characteristics as the rock glistens back at him. “This portion is spectacular … I think there are enough indicators in this to be excited.”

Soon, Panneton will know for sure. Half of the samples have been sent away for detailed analysis. Only when that analysis comes back can he be more certain of how much gold is contained.

If that analysis meets or exceeds his expectations, that could be a big deal for getting a new mine started – or, at the very least, could help him find the millions of dollars he wants to invest in more exploration.

Meanwhile, Panneton is operating on a time crunch.

Drilling two kilometres beneath Yellowknife is not an overnight exercise. First, Gold Terra had to procure specialist drilling equipment from Sudbury, Ontario. It then takes weeks to reach the kind of depth needed.

This summer, things took even longer than planned. The drillers made a mistake at 1,900 metres, Panneton said, setting work back by almost a month. Then Yellowknife’s evacuation scratched a second month.

All of this is valuable time he could have spent marketing the project to investors if he already had the results in hand. Instead, he’s still waiting. When the results come back, he thinks he’ll have about a month before the Christmas shutdown to take those results to investors and convince them this may be the next big thing.

The big number Panneton says he needs to hit is two million ounces. If he can demonstrate, with a reasonable degree of confidence, that two million ounces of gold can be economically mined around Con, he believes that will suggest a new mine is viable.

So far? Panneton says the old Con Mine left 600,000 ounces within touching distance. Gold Terra has found 542,000 further ounces near the surface in the same region.

“We only need to find one million ounces below the mine,” he said during a trip to the drill site last week.

Drillers are about to start using wedges – deflecting the drill angle from its original position to test more samples at roughly the same depth, but in slightly different places – to broaden the sample area Gold Terra can work with.

“There’s gold. We know that. However, I don’t know how much the grade is,” Panneton said, raising the next issue: the grade.

In exploration, the grade is a way of measuring how much gold you’re expecting to get for every tonne of rock you mine.

Gold grade is usually expressed in grams of gold per tonne of ore. The more gold per tonne, the better. The deeper the deposit, the higher the grade probably needs to be, since digging deep to get the gold costs more money – and you’ll want to get more gold back to ensure a mine is profitable.

“It could be five grams or 20 grams. If I have five grams, I’m in the right spot. I just need to drill more,” said Panneton, quoting per-tonne figures.

“If I find five grams, the market will be negative. But I’m not, because I can prove up this gold. I just need more holes.

“This is how tough the market is today. Because if I hit 20 grams, they’re going to like it. But then they’re going to say: ‘Oh, but it’s deep. It’s going to be so expensive to go down there.’ So there’s always a negative aspect, even if it’s positive.”

Any mineral exploration is a gamble, but spending months on one drill hole is a test of patience both for the company and its investors.

“When you do a one drill-hole thing, you spend $1 million-plus on one drill hole and you wait six months for the result,” said Panneton.

“In the eyes of the investor, it’s too long. It’s way too long. They want quick results.”

So why do it?

Gold Terra has the option to buy current Con Mine owner Miramar and all of its assets – in other words, the mine site – if enough gold shows up to make that purchase worthwhile.

The only way to know there’s enough gold, said Panneton, is to drill this deep, even if it makes investors squirrelly.

More: Is the key to a new Yellowknife gold mine beneath an iconic shaft?

“If I want to buy the Con Mine and I need to find two million ounces, this is the only target that can generate a million ounces,” he said.

“Say I have almost half of it now, and I need the other half: I need to do that. Because otherwise, I have to drop the option [to purchase Con] and say goodbye to the potential of reopening the Con Mine.”

That might not mean the end of Gold Terra if it came to pass – the company has areas of interest elsewhere around Yellowknife – but Panneton thinks there is real potential to restart mining in the vicinity of Con, with processing facilities outside the city to the north.

“Maybe near-surface we’re going to get to 600,000 or 800,000 ounces, which is not bad. That many ounces near the surface of the Con Mine site is almost the first seven years of operation,” he said.

During those seven years, he argues, a mine operator could use its income to carry out extra drilling and get a firm fix on another million ounces.

But Gold Terra could really use some big numbers from this summer’s drilling to demonstrate that those million ounces are achievable.

“I know I can raise money,” Panneton said, “but the market is the market. This market is currently extremely difficult to raise money for juniors.

“Only the good management teams and the good projects will survive. The cleaning of the junior exploration companies in Canada is going to be very harsh over the next 12 months.

“This looks great. But until you have the results, you don’t know.”