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NNSL Photo/graphic

Caribou graze in front of the Lupin gold mine. Wolfden Resources is in the process of acquiring the past producer from Kinross and with gold prices rising, it is considering re-opening the Kitikmeot facility. - photo courtesy of Ray Piwtorak

Nunavut good as gold

David Ryan
Northern News Services

Iqaluit (May 01/06) - The mineral that helped build many parts of the North is leading to a new boom in Nunavut.

The price of gold has increased by more than 44 per cent in the past year and now sits at more than $620US an ounce (oz.).

"Things look very positive," said Lou Covello, president of the NWT/Nunavut Chamber of Mines.

There are two potential mines making their way through the regulatory-approvals phase: Miramar's Doris North project near Hope Bay and Cumberland's Meadowbank project near Baker Lake.

In Cumberland's case, Meadowbank has an estimated reserve of 2.9 million oz. and it hopes to produce 330,000 oz. of gold per year over an eight-year period.

Miramar is taking a phased approach to developing Hope Bay. Phase 1 at Doris North is expected to last two years and yield 311,000 oz. of gold.

It plans to use the revenue from this initial project to help finance a second five-year phase targeting 200,000 oz. a year from the Boston, Doris Central and Madrid deposits of the same belt.

Phase 2 revenues would in turn pay for an eight-plus-year Phase 3 targeting the less accessible parts of the same areas to produce 350,000-400,000 oz. annually.

The entire Hope Bay belt contains known and inferred gold resources totalling about 6.4 million oz.

With the high prices, Covello said there could soon be even more gold exploration going on around the North.

The market has become so lucrative, Wolfden Resources, which is in the process of buying the dormant Lupin gold mine, is now considering restarting the operation which ceased in 2005.

"Our primary reason of acquiring the mine is for the infrastructure," said Ewan Downie, Wolfden president.

Lupin is located 75 km from the company's Izok Lake base metal project and 155 km south of its Ulu gold deposit. A study done on the Lupin mine in 2005 by B.H. Martin Consultants Ltd. states the mine has a remaining resource of potentially 203,293oz. of gold.

"Over the next several months, we will analyze our options," said Downie, noting there is a possibility of mining the Ulu gold deposit as early as the first quarter of 2007.