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Mine plant won't be in the North

Guy Quenneville
Northern News Services
Published Monday, August 3, 2009

SOMBA K'E/YELLOWKNIFE - The company developing a gold-cobalt-bismuth-copper mine near Whati has announced it is moving part of the mine's infrastructure south to save money and alleviate concerns among Tlicho elders about possible contamination of the local water supply.

Fortune Minerals, based in London, Ont., will locate the hydrometallurgical process facility that will convert ore mined at its NICO project into pure metal at one of four possible sites in Alberta, Saskatchewan or Manitoba.

The company had previously considered locating the 75-person plant at the former Con Mine in Yellowknife, then thought about keeping it with the rest of the mine, located 50 km northeast of Whati.

But several factors forced the company to rethink that decision, said president Robin Goad.

"It's going to be cheaper to operate in the south than in the Northwest Territories," he said. "Power is the number one issue. But there are other issues as well."

Addressing environmental concerns expressed by the Tlicho government and community elders also played a key hand in the decision, he said.

"The Tlicho had expressed that they would have rather seen the processing happen somewhere else," said Goad. "It boils down to concern that there might have been some water quality impacts. There would not have been, because we've designed the mine and the processing plant such that this was not an issue, but if it alleviates some concern from the land owners in the area, then we had to be responsive to that."

For elders, environmental issues trump concerns over possibly losing out on jobs, said Alfonz James Nitsiza, newly-elected chief of Whati.

"This particular mine is going to be such a way that, if it's given a greenlight, is going to be in the heart of Tlicho land," he said. "It's right by the river system and Behchoko, the biggest community in the region, is downstream. So I think they take all that into consideration."

Even though the plant will move south, remaining infrastructure will still pose a possible problem to the surrounding environment in the eyes of some community members, added Nitsiza.

"It may sound good to say, 'OK, we're moving the facility out of the area,' but there's still going to be concern. They're going to be transporting stuff over land. These are major concerns that need to be talked about in all the communities."

The remaining mine infrastructure will mainly consist of open pits, underground tunnels and the main process plant - where the mineral sulfides that lend themselves to metal concentration will be separated from waste rock.

Those operations will require 150 employees and, unlike the hydrometallurgical processing facility, will not require highly specialized staff requiring years of education and experience - positions not easily obtained by Northerners, said Goad.

On the other hand, "Mining and milling can be done easily with local people and with a very high percentage of aboriginal labour," he said.

The NICO project is currently undergoing environmental assessment by the Mackenzie Valley Environmental Impact Review Board.

On July 15, China Mining Resources Group Ltd. purchased enough shares in Fortune to give it a 15 per cent stake in the company.

Given another Chinese-owned company's recent acquisition of the High Lake and Izok Lake zinc deposits in the Kitikmeot region of Nunavut (Minerals and Metals Group) and Chinese Investment Corporation's purchase of a 15 per cent interest in Teck Resources, one of the largest integrated mining companies in Canada, Chinese investment in Canadian mineral resources is becoming a trend to watch, said Goad.

"China is growing. It is a huge manufacturing-base economy. They need sources of raw materials to conduct this manufacturing and they're looking for reliable sources of supply and Canada is a very reliable source of supply."