As predicted as far back as last January, hard rock exploration in the Yukon is up over last year significantly.

Mike Burke of the Yukon Geological Survey told delegates attending this morning's opening of the 33rd annual Yukon Geoscience Forum that exploration expenditures in quartz mining are expected to hit $50 million, or more.

The Yukon Zinc Corp. is leading the charge with expenditures of more than $20 million, though there are nine companies that have spent $1 million or more in exploration and advance exploration work, Burke said.

He said Yukon Zinc will hopefully be in a position to complete its feasibility study in the next six months, then decide on potential production.

Burke highlighted a number of other projects, such as the Division Mountain coal project near Braeburn, the renewed interest in the copper deposit near Minto Landing by the Sherwood Copper Corp., which bought 100 per cent interest in the project.

True North Gems continued to work its emerald deposit in the Findlayson district, and North American Tungsten drilled some 25 holes in the Mac Tung tungsten deposit.

Strata Gold, Burke continued, expanded its drill program on the Dublin Gulch gold property. With the price of silver rising along with every other metal price, there is a renewed interest in the silver properties in south Yukon.

There is also hope that with the assets of the former United Keno Hill Mines Ltd. in the hands of Alexo Resources Corp., there will be production activity by next winter, Burke said.

He said the fact there are still exploration crews still working in remote locations at this time of year is a reflection of what kind of exploration season it's been for the hard rock industry.

'Some of the expenditures are coming in a little higher so I am pretty confident in saying we are going to hit $50 million,' Burke said.

With more advanced projects like Yukon Zinc's Wolverine property comes higher expenditures, he said.

Exploration hit an all-time high in 1996 with expenditures of about $56 million. The record year, however, was followed by a steady decline, until expenditures hit an all-time low in some $6 million in 2002.

Exploration began a slow rebound in 2003 with estimated hardrock exploration expenditures of more than $13 million, followed last year with expenditures of $22 million-plus.

With the upswing in metal prices, predictions for an even stronger year than last year began in January at Vancouver's major mining conference when there was assurance exploration would top $30 million and more.

In the placer gold mining industry, production is down while the price of gold is up.

Placer geologist William LeBarge of the Yukon Geological Survey told conference delegates that numbers to this month show 69,802 ounces mined across the Yukon, with a value of $29.7 million.

But with the rest of November and December to go, there is still a chance that the placer industry will match up with last year's value of $32.4 million, LaBerge said.

He said the Indian River and Dominion Creek watersheds were again the leaders in gold production, accounting for 38 per cent of all placer gold mined this year, or 26,472 ounces, down slightly from last year's 27,366 ounces.

Accounting for 17.8 per cent, or 12,388 ounces, the Klondike River, Bonanza Creek and Hunker Creek area produced the second-greatest volume of gold.

Third in line were the 12,314 ounces produced in the area of the Sixtymile and Fortymile rivers, and the Moosehorn Range in western Yukon, LaBerge told delegates.

The Kluane areas accounted for 3.8 per cent of gold production with 2, 667 ounces; the Mayo region accounted for three per cent of gold production with 2,058 ounces; the Dawson Range, including Mount Nansen outside of Carmacks, accounted for 2.2 per cent of production with 1,546 ounces.

In the Whitehorse area, the Livingstone area, which produced 17 ounces of gold last year, was silent, though 27.4 ounces came of out of Iron Creek.

Placer miner Tara Christie said it's understandable production is down in the placer industry, while gold prices remain buoyant.

With escalating fuel prices, said Christie, the cost of the seasonal operation can be driven up dramatically, particularly for smaller operations, as the cost of fuel of can be the single largest expense.

For somewhat large operations like her family-owned operation in the Indian River area, labour can be a larger budget item but fuel, nonetheless, is running around 30 per cent of the overall cost, Christie said during an interview at the conference this morning.

The former president of the Klondike Placer Miners Association said miners will turn to exploration in times of high fuel prices because it's much less costly than stripping overburden to get into new deposits. With the exploration drilling, she said, miners are able to further define their gold deposits to reduce the cost of production when they do decide to strip new ground, she said.

'People were doing as lot of exploration work,' she said.

Of the 128 operating mines this year down from 163 in 2002 the majority are what LaBerge described as Mom and Pop operations, with four or fewer paid employees.

'What we are seeing in the placer industry here we are seeing in Alaska,' Alaska geologist David Szumigala of the state's Department of Natural Resources explained this morning. 'It is the price of diesel; it really hurts the smaller operators.'

The production of placer gold hit 28,074 ounces in the state last year, but Szumigala expects the total to be less this year, just as it looks for the Yukon.

Overall, with higher mineral prices across the board, the state's mineral industry accounted for a total $1.6 billion US, the 10th straight year the value exceeded $1 billion.