February 2015

Industry at a glance

By Chris Balcom, Tom DiNardo, Sahar Fatima, Kelsey Rolfe, Katelyn Spidle

Diavik expands

Development is set to begin this year on a fourth kimberlite pipe at the Diavik diamond mine in the Northwest Territories. Diavik announced in November that its operator, Rio Tinto, approved the addition.

The final pipe, included in the original mine plan and known as A21, is expected to cost US$350 million over four years to develop, with production beginning in late 2018. The open pit mine will require the construction of a rockfill dike around the ore body.

“This is great news for Diavik,” said president Marc Cameron, “but also for the local communities in which we operate, where we are committed to delivering economic and social benefits that will endure beyond the life of the Diavik mine.”

The A21 project will be located south of Diavik’s existing operations at Lac de Gras, about 300 kilometres northeast of Yellowknife.

“A21 was the first kimberlite found during exploration in the mid- 1990s,” said Rio Tinto spokesperson Doug Ashbury.

Alan Davies, Rio Tinto diamonds and minerals chief executive, said, “Our decision to invest in the Diavik A21 project reflects our strong confidence in the diamond sector and in our ability to compete effectively in the industry.”

Diavik will update its ore reserves in the first quarter of 2015. The current mine plan has production ending in 2023.

– Sahar Fatima

Work temporarily suspended at Endako mine

Thompson Creek Metals Company put operations on hold at its Endako molybdenum mine in northern B.C. in late December.

The company cited the continued weakness in the molybdenum market as the cause of the temporary suspension. Thompson Creek holds a 75 per cent interest in the mine, while joint venture partner Sojitz Mining Resources Inc. owns the remaining 25 per cent.

Thompson Creek is uncertain at what point operations may resume, or to what extent the market needs to rebound. “The price would have to be higher than our cost, and that price would have to be sustainable,” said Pamela Solly, director of Thompson Creek’s corporate responsibility office and investor relations. She added that the company is closely monitoring market conditions. By mid-December, the price of molybdenum dropped to just over US$9/lb, while Thompson Creek’s extraction costs averaged US$10.45/lb in the third quarter of 2014.

Roughly half of the 84 salaried employees at the mine have been let go, while work for the 263 hourly employees has been suspended indefinitely.

– Chris Balcom

WIM receives funds to form gender advisory committee

Women in Mining (WIM) Canada received $250,000 from the federal government in November to fund a new initiative to increase women’s participation in mining.

The funding helped create a gender advisory committee comprised of representatives from 12 mining companies and organizations including CIM, Rio Tinto, Teck Resources, Vale, Barrick Gold and the Mining Industry Human Resources Council. The committee held its first meeting in November. It will meet twice a year for the next three years to develop a national Women in Mining action plan.

“The intent of the project is to hire 50 women [amongst committee member companies] by the end of it, in both senior executive roles and in the trades,” said WIM Canada president Tabetha Stirrett. The initiative could also include promoting women at the management level to the senior executive level. She said it was not yet clear how that goal would be reached.

According to Stirrett, the committee will develop the national action plan in the first two years, and then in the third year the companies will put together individual action plans for the communities they operate in.

The committee has also hired a consultant from Women of Influence to suggest best practices for educating all employees of committee member companies on how gender diversity can help a company’s bottom line.

Women currently make up 14 per cent of the Canadian mining sector workforce and 12.3 per cent of senior roles, according to WIM Canada.

– Kelsey Rolfe

Saskatchewan Polytechnic home to the new CMI

The International Minerals Innovation Institute (IMII) and Saskatchewan Polytechnic are partnering to support the province’s mineral industry. Thanks to a $500,000 donation from IMII announced in mid-November, Saskatchewan Polytechnic is now home to the Centre for Minerals Innovation (CMI).

The centre’s purpose is to coordinate training programs that meet the minerals sector’s needs. It will collaborate with industry partners and the province’s regional colleges to offer courses with a standardized CMIapproved curriculum. The funds are intended to support the centre through the next two years, but CMI will not depend on IMII for financing in the long term.

“[The minerals industry] is a huge part of our economy,” said Cristal Glass-Painchaud, the centre’s new director. “The province, Polytechnic and industry partners recognized that there was a need for more specific training and education services directly for that sector.” CMI’s current initiatives include standardizing safety training in the province, offering more business management and leadership courses, and creating a “transition to mining” program. Glass-Painchaud said CMI will also offer simulator training and is looking into industry needs in this area. Most of these new courses will be offered by April 2015.

Engin Özberk, executive director and senior technical advisor at IMII, explained that the collaboration is part of a larger effort to support Saskatchewan’s mining industry. In the past year, IMII – which is funded jointly by industry and government – financed nine other projects aimed at supporting mining education, training and research in Saskatchewan. IMII recently pledged $786,000 toward a joint project by the University of Saskatchewan and Saskatchewan Polytechnic to research industry safety culture and practices.

“[CMI and IMII] are very much interested in applied research,” Özberk said. “We were looking for new ways of doing things that are regularly applicable to the industry.”

– C.B.

Yukon govt. appeals Peel Watershed decision

The Yukon government is appealing a recent ruling on the Peel Watershed by the territory’s Supreme Court. On Dec. 2, Justice Ron Veale ruled that the government must renew consultations with First Nations, as its plan to develop the region violated the spirit of existing agreements over the planning process.

The environmental groups and First Nations that launched the case have hailed the decision as an historic victory, but the government contends that the ruling unduly limits its control over the land.

In 2011 the Peel Watershed Planning Commission recommended that 80 per cent of the region should be protected from development. The government released a modified plan in 2014, limiting the protected area to around 30 per cent.

“We’re appealing this decision because we believe publicly elected governments must have the final say about what happens on public land,” said Scott Kent, Yukon minister of energy, mines and resources. “Even though these commissions are appointed by our governments and First Nations governments, they’re still only making recommendations.”

Unsurprisingly, the appeal has ruffled feathers in the opposing camp. “It sends a very clear message that this government is unwilling to work with First Nations in terms of land management and land claim implementation,” Norman Snowshoe, Gwich’in Tribal Council vice-president, told the CBC. The council was the intervener in the case against the government.

At roughly 67,500 square kilometres, the Peel Watershed covers an area nearly the size of New Brunswick, and holds significant mineral potential. While still relatively underexplored, the government estimates that about $46 million was spent on exploration between 2002 and 2009. There are currently 8,940 mineral claims in the region.

– C.B.

Plan Nord central to presentations at Québec Mines

Northern development was front and centre at Québec Mines, held in Quebec City last November. Speakers at the plenary session recognized the potential of the reignited Plan Nord and emphasized responsible development.

Pierre Corbeil, mayor of Val d’Or, discussed the importance of involving the local workforce and suppliers in the development of the north. “It’s necessary to build the north on the foundations already in place,” he stated.

Ugo Lapointe, co-founder of “Pour que le Québec ait meilleure mine!” said there are already some good examples of sustainable development in the north including Glencore’s Raglan mine, Iamgold’s Niobec mine and the Arianne Phosphate Lac à Paul project. However, he maintained that no project is perfect and there is still much work to be done: “[We must make] balanced strategic choices for the north, reinforce environmental protection, respect the rights of aboriginal citizens, and maximize the collective implications for us and future generations.”

In the spirit of responsible development, Quebec Minister of Energy and Natural Resources Pierre Arcand announced the government would begin consultations with communities affected by the Plan Nord in the spring. “When you install yourself in the territory to extract resources that belong to Québécois, it’s necessary to do it with the approval of Québécois,” he said.

Quebec was not the only jurisdiction discussed, as CIM executive director Jean Vavrek chaired the session on sustainable development in French West Africa on the last day of the conference. Past Quebec premier Jean Charest delivered the keynote address in which he discussed the potential for economic growth in Quebec and Africa.

The session also included a panel discussion on local purchasing and economic development in Africa with Ibrahima Basse, finance director at the Senegal Chamber of Mines; Christine Logbo-Kossi, the executive director of the Côte d’Ivoire Chamber of Mines; Laetitia Gadegbeku, trade commissioner from the Canadian Embassy in the Côte d’Ivoire; and Adama Soro, trade commissioner from the Canadian Embassy in Burkina Faso.

CIM organized the incoming West African delegation to Québec Mines 2014 with financial support from Canada’s Department of Foreign Affairs, Trade and Development through its Global Opportunities for Associations program.

– Tom DiNardo

Survey reveals aboriginal view of mining

PR Associates surveyed aboriginal Canadians in remote communities around the country to shed light on their perception of the mining industry | Courtesy of PR Associates

The results of a survey assessing aboriginal Canadians’ perceptions of the mining industry were released last November. Being the first of its kind, the survey will serve as a tool to help companies gain social licence for their projects by identifying concerns and priorities for indigenous communities. PR Associates commissioned the survey following the ruling by the Supreme Court of Canada last June that granted the Tsilquot’in First Nation title over its traditional territory.

According to 500 randomly selected respondents living in remote communities, the overall perception of the industry is unfavourable (49 per cent). Indigenous communities in Alberta and Quebec represent the most unfavourable opinions (59 per cent and 56 per cent, respectively), while support is highest in the Northwest Territories (57 per cent favourable). Most respondents (61 per cent) had not changed their opinions of the industry in the past three years, but of the 31 per cent who had, 23 per cent reported that their perception worsened.

Respondents indicated that the industry’s top priorities should be collaborating with aboriginal communities (50 per cent) and decreasing environmental impact (55 per cent). Nearly three-quarters of respondents said they believed that mining companies provide opportunities for Canadians, but only 42 per cent stated that these opportunities are extended to aboriginals in general.

Findings remained relatively consistent by demographic characteristics in indigenous communities, and aboriginals currently or formerly employed in the industry hold similar views to those outside it.

Natural Resource Canada estimates there are about 1,200 aboriginal communities within 200 kilometres of roughly 180 producing mines and more than 2,500 exploration sites in Canada. Mining companies are the largest private sector employers of aboriginals.

– Katelyn Spidle

Lundin reaches commercial production at Eagle mine

Aerial view of Eagle mine | Courtesy of Lundin Mining  

Lundin Mining announced it achieved commercial production at its Eagle nickel-copper mine in Michigan in late November, about two months after launching operations at the mine. Located in the Upper Peninsula of the U.S. state, commercial production for the US$400-million project had previously been slated for the first quarter of 2015.

“The team at Eagle mine has done an excellent job in accelerating the ramp up and delivering commercial operations ahead of expectations,” said Paul Conibear, president and CEO of Lundin, in a release. “The Eagle mine will be significant to the earnings and cash flow of Lundin Mining, and a major employer and economic contributor in northern Michigan.”

According to John Miniotis, senior manager of corporate development news and investor relations, the underground mine has a target throughput of 2,000 tonnes per day with Probable and Proven Reserves of 5.16 million tonnes.

The mine generated a throughput of 1,536 tonnes per day in October and 1,865 tonnes per day in Novem- ber. It also improved nickel recovery to 85 per cent from 79 per cent in the same period.

– S.F.

Advancements and optimization at SMP 2014

The 2014 Orebody Modelling and Strategic Mine Planning conference brought 264 international delegates to Perth, Australia in November for presentations around the conference’s theme, “Integrated mineral investment and supply chain optimization.”

The conference boasted roughly 30 presentations on topics related to technological advancements and global optimization. These stimulated fruitful discussions on how the sector is adapting to uncertain geological and market conditions, according to symposium chair Roussos Dimitrakopoulos.

On the final afternoon of the conference, Dimitrakopoulos led a panel discussion on the present and future challenges in strategic mine planning optimization. These, he said, fall into three main categories: integrating research and developments with commercialization, fixing the link between short-term and long-term planning, and promoting the transfer of knowledge.

Jeff Whittle, technical director of Whittle Consulting, was this years’ honorary guest. He said he was impressed with the overall interest in the conference. “It is not uncommon in long conferences for there to be a significant drop-off in attendance near the end,” he remarked. “However for SMP 2014, […] the audience was largely intact right to the end.”

The three-day conference was organized by the Australasian Institute of Mining and Metallurgy (AusIMM), the Society for Mining, Metallurgy and Exploration (SME), and the South African Institute of Mining and Metallurgy (SAIMM). Major sponsors included AngloGold Ashanti, BHP Billiton, De Beers, Dassault Systèmes, Minemax, Newmont Mining, Schneider Electric, Springer and Vale.

– K.S.

Canada promotes aboriginal involvement in Plan Nord

In November Canada’s Minister of Aboriginal Affairs and Northern Development, Bernard Valcourt, announced a $7.3 million investment to support aboriginal participation in the province’s Plan Nord through the True North Treasure Initiative – Labrador Trough. The funds will be used to implement strategies that ensure aboriginal communities profit from natural resource development in the Labrador Trough.

The program has three objectives: develop aboriginal human capital, strengthen aboriginal entrepreneurship and enhance the value of aboriginal assets. The plan is to maximize job creation in target communities by creating labour profiles that identify their particular capacities and needs. The initiative will also establish a directory for local aboriginal businesses.

“Our government is continuing to support First Nations and Inuit so that they can take advantage of economic development opportunities flowing from the exploitation of our natural resources,” Valcourt said. “We are proud to have launched an initiative that encourages aboriginal communities located near the Labrador Trough to participate fully in mining industry development in this region.”

The announcement came during the opening ceremony of the True North Treasure Initiative – Labrador Trough, an event organized as part of the 35th Québec Mines conference in Quebec City.

– K.S.

PDAC recognizes industry leaders

The Prospectors and Developers Association of Canada (PDAC) is set to honour six industry leaders at its annual convention this spring. PDAC 2015 Awards Evening will be held March 2, at the Fairmont Royal York Hotel in Toronto. PDAC’s awards committee chose the awards recipients on the recommendation of its board of directors.

David Palmer, president and CEO of Probe Mines Ltd., will receive the Bill Dennis Award for a Canadian mineral discovery or prospecting success: the Borden Gold Project, located near Chapleau, Ontario.

The Viola R. MacMillan Award for company or mine development is going to Matt Manson, president and CEO of Stornoway Diamond Corporation, in honour of his leading role in the ongoing development of Stornoway’s Renard project, located in north-central Quebec.

The Ivanhoe Mines Kamoa Discovery Team will be collectively awarded the Thayer Lindsley Award for international mineral discoveries, in honour of their discovery of the Kamoa copper deposit in the Democratic Republic of Congo.

Noront Resources Ltd. will receive the Environmental & Social Responsibility Award for its expanded community engagement program and other social initiatives in northern Ontario. Noront has partnered with Matawa’s Kiikenomaga Kikenjigewen Employment and Training Services and with Confederation College to create the Ring of Fire Aboriginal Training Alliance.

The Skookum Jim Award for aboriginal achievement in the mineral industry will go to Sam Bosum, who has been instrumental in improving relations between the Oujé- Bougoumou Cree Nation and the mineral industry near Chibougamau, Quebec.

Bill Pearson will receive the Distinguished Service Award, in recognition of his illustrious career and longstanding dedication to the industry in which he worked for more than 40 years. Pearson convened the first meeting of the Committee for the Professional Registration of Geoscientists of Ontario in 1989. He has also served as president of the Association of Geoscientists of Ontario and founding president of the Association of Professional Geoscientists of Ontario.

– C.B.

Repair of tailings dam is priority number one for mine operator

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