North American Tungsten announced last week that it is again placing the CanTung mine on care and maintenance status due to the loss of a financing deal. The mine, located near the NWT/Yukon border, employed close to 200 workers but none were from the Deh Cho.
The company's president, its chief financial officer and two of its directors resigned last week. Malcolm Robb, acting manager of mineral and petroleum resources for the Department of Indian Affairs and Northern Development (DIAND), noted that North American Tungsten has stated that the mine is only on care and maintenance status as a temporary measure.
Whenever the mine goes back into production, "they'd have to start coming up with the staged security deposit specified in the (water) licence," Robb said.
Should the company become insolvent, DIAND has a number of contingencies outlined in its latest policy but they depend on the exact circumstances.
In a worst case scenario, DIAND may take over the mine depending on the "extent of the benefits or potential benefits to the Crown in reducing the environmental impacts and ultimate cost to Canadian taxpayers of environmental remediation at the mine site," the policy reads.
"It gets quite complex... it's kind of a tricky legal area because a number of acts come into play," Robb acknowledged.
Melody McLeod, chair of the Mackenzie Valley Land and Water Board, said it's uncertain whether the company's $7.9 million reclamation liability will be collected on schedule because that figure was attached to North American Tungsten's recently issued water licence. The five-year licence was drafted in expectation that the mine would remain in production, McLeod noted.
"Their decision (to shut down) kind of puts everything in a state of suspension right now," McLeod said.
As part of the payment schedule, North American Tungsten was due to pay $1.5 million by the end of this month.
The Land and Water Board will likely re-examine the matter at its next meeting on Dec. 17.
Call for clean up
News of the mine's closure prompted the Canadian Parks and Wilderness Society (CPAWS) and the Canadian Arctic Resources Committee (CARC) to call for an immediate clean-up of the mine site.
The conservation groups want the government to ensure the company is held fully responsible for reclamation costs, rather than letting the bill fall into taxpayers' laps.
Kevin O'Rielly, research director for CARC, said an independent report completed last year showed that the company's assets were substantially less than its liabilities, let alone its reclamation costs.
"It appears that the public will be expected to handle the clean-up costs now," said O'Rielly, who added that the NWT desperately requires legally-binding mine reclamation standards.
Peter Marcellais, chief of the Nahanni Butte Dene Band, noted that the mine sits on his band's traditional territory.
"The mine's sitting right on the Flat River, so it comes into Nahanni River and it's always been a concern," said Marcellais.
Calls to North American Tungsten's office in Vancouver were not returned prior to press deadline.
A North American Tungsten Corporation Ltd. press release stated that "the company is in discussions with counsel to determine the appropriate course of action."