A group of small islands about 14 airline miles southwest of Petersburg, Alaska, known as the Castle islands, lie midway in Duncan Canal, athwart the inside passage used by Alaska coastwise shipping. Duncan Canal is a. long shallow bay which nearly bisects Kuprean of Island, extending northward from Sumner Strait [Fig. 12].
In 1913, the USGS discovered that one of the islands, occupying about one-half acre, consisted of high grade barite in contact with schists. At low tide the small island was connected to a larger island, but at high tide the water separated the Islands along the schist-barite contact [Fig. 1]. Configuration of the area after removal of the barite island is shown in Fig. 2.
In Sept., 1913, Alaska Treadwell Gold Mining Co. staked the barite outcrop. Their Red Cliff lode claim contained 0.6 acres and was taken primarily to investigate the finely divided sulfides that occur throughout the barite ore. A short tunnel was driven, but the gold and silver tenor of the sulfides proved to be uneconomic and further work was halted. The claim was patented in 1929, and in Dec., 1931, the Alaska Juneau Gold Mining Co. drilled a series of holes on the property, sufficient to establish the geometry and the reserves of the barite ore body beneath the claim. Assay results for gold and silver were not high enough to justify mining for these metals. Therefore the property remained idle until1966, when the Alaska Barite Co., recognizing the increasing market demand for high grade barite, acquired title to the claim. This company began immediate construction of a mining camp on the adjoining larger island. A primary crusher, conveyor, stockpile and ship loading facility was completed, and the first 25,000-ton ore boat departed Castle Island with a load of barite on Dec. 9, 1966. By mid-1969 most of the barite reserves had been removed from the Red Cliff lode claim.
Inlet Oil Corp. recognized the potential for extension of such ore bodies as the barite, beneath the surrounding marine waters. Therefore, Inlet acquired from the State of Alaska during late 1967 and early 1968 all, of the exploration rights on several thousand acres, from high tide line downward, beneath the waters surrounding the Castle Islands. Subsequently, Inlet acquired partners consisting of a 50-percent working interest divided among Apco Oil Corp., Loeb-Rhoades & Co. and the Donner Advisory Corp., with Inlet as general partner and operator.
In late 1968, Inlet conducted a preliminary seismic and bottom geochemical survey in and around the barite island. Both geophysical and geochemical anomalies were revealed in sufficient magnitude to justify a preliminary coring program. A contract was let to Northern Corp. who drilled 20 holes in the winter of 1968. Results Of these holes confirmed the anomalies not only by extending the known ore body, but in finding new ore bodies. Detailed geophysical work consisting of high resolution seismic, marine magnetic, and on-bottom gravity was conducted during 1969.