Dec '06/Jan '07

Nova Scotia

Exploration update

By P.K. Smith, Geological Services Division, Nova Scotia Department of Natural Resources

We are healthier, richer, and better informed because of the treasures we extract from the earth. From minerals and metals extracted from below our feet, we create TVs and other electronics to entertain ourselves, telephones to communicate with, and computers that are essential for our daily business, as well as the millions of vehicles to transport people and essential goods. Remove the contribution of the mining industry to your home, and about the only thing left is the mortgage.

As the face of mining has changed, so have the faces of those it employs. Today, the old image of miners and prospectors with picks and shovels has been replaced by workers using robotics, computers, and the most modern high-tech equipment. Nowhere is the beneficial impact of mining so important than in Nova Scotia.

Economic Impact

According to a 2006 report by Gardner Pinfold Consulting and CRA, Nova Scotia’s mining industry can brag of one of the highest earning levels in the provincial economy: more than $1,000/week in 2005. This is more than 40 per cent higher than the average of all other economic sectors in the province.Mining contributed $400.4 million to the province’s GDP, through direct and spin-off industry activities in 2005, the year in which the statistics were provided.A total of 5,260 direct and indirect jobs were based on Nova Scotia’s mining sector.


Mineral exploration in Nova Scotia during 2006 has shown a modest increase over the previous year, with allowable provincial field expenditures estimated at ~$8 million and Statistics Canada estimating ~$11 million for total exploration expenditures. This increase is not only reflected in the upswing in gold exploration around historical gold mining districts in the southern part of the province, but also in a resurgence of exploration for base metals throughout both the northern and southern portions of the province. Significant work worth mentioning includes that of Acadian Gold Corp. at their Scotia Zinc Project in Gays River that is intended to bring the former zinc-lead deposit back into production in 2007. In addition, two new exploration drill programs are being carried out for base metals on Cape Breton Island by firstly, Merrex Gold Inc. and joint venture partner, Aur Resources, at the Jubilee deposit; and secondly, for base and precious metals at the Coxheath deposit by Burnt Point Resources. Although exploration for IOCG mineralization along the Cobequid– Chedabucto fault system is seeing somewhat reduced activity, interest along the entire linear is still high.


On December 15, 2005, the Minister of Natural Resources announced Xstrata Donkin Mine Development Alliance was the successful proponent for the Donkin Coal Resource Block in Cape Breton County.Over the next two years, the Alliance plans to conduct an extensive resource evaluation and feasibility study leading to the anticipated development of the more than 200 million tonne (Mt) Donkin coal resource. At present, the two tunnels have been reopened and dewatering has commenced.

Mine Reclamation

On December 28, 2005, Pioneer Coal Ltd received environmental approval for a surface coal mine and reclamation project at the former Prince mine site in the Point Aconi Resource Block, Cape Breton. This reclamation mine project will extract ~1.6 Mt of coal over a seven-year period. This surface mine will restore heavily disturbed land for future land use. Pioneer Coal expected to be in operation at the Prince mine site by summer 2006.

Brogan Mining Company Ltd has operated a reclamation mining project at Little Pond since 1999. The project is reclaiming a large tract of land that was heavily impacted by numerous bootleg operations, and several legal underground mines. In 2005,Brogan Mining concluded coal extraction and focused their work on final reclamation.

The Greenhills Development completed site development and started production in early 2006 at its surface coal mine in Florence, Cape Breton. This project will reclaim an area impacted by the underground workings of the Florence Colliery.

In Pictou County, Pioneer Coal Ltd has operated the Stellarton Surface coal mine since 1996, producing ~220,000 tonnes per year. On September 21, 2005, the Premier and Minister of Natural Resources announced the impending transfer of impacted Crown lands to the Town of Stellarton in three phases. Phase 1—lands not mined by Pioneer Coal, will be transferred immediately upon completion of surveying;Phase II—lands on which mining is complete and reclamation is underway will be transferred when reclamation is complete; Phase III—land presently being mined will be transferred when reclamation is completed. The provincial government has promoted this partnership between the municipality, the private sector, and the province as a model of how reclamation mining can provide economic activity to an area, and at the same time convert lands that were previously an environmental and public hazard into productive lands for future generations.

Aggregate and Industrial Mineral Resources

In 2003, aggregates and industrial mineral resources were valued at $75 million. In September 2005, Fundy Gypsum Co. announced they would spend $10 million over the following 18 months to expand their open pit mining operations near the town of Windsor.This is expected to secure the future of the mine and its 150 to 160 jobs for at least 20 years.The province’s five gypsum producers are operating at peak capacities, with total production approaching 9 Mt per year.

Salt production for the year remained steady at approximately 1 Mt from two operations, the Canadian Salt Company Ltd and SIFTO Canada Ltd in Cumberland County.


Black Bull Resources Inc. is currently undergoing restructuring at its White Rock mine in Yarmouth County where it produces and markets quartz products under the trademark ScotiaWhite™. The total measured and indicated quartz resource is presently 12.1 Mt grading 97.4% SiO2, with an additional 16 Mt of an inferred quartz resource. The company continues to evaluate their kaolin resources at the White Rock mine. The total measured and indicated kaolin resource is currently 4.8 Mt grading 24.2% kaolin with an inferred kaolin resource estimated at 6.3 Mt. Testing indicates the ScotiaWhite™ quartz can also be upgraded to produce a high-quality product with greater than 99.5% SiO2 for use in e-grade fiberglass and other specialty glass markets.


MacLeod Resources Ltd continues production of high-quality red marble from its quarry at Kennedy’s Brook in southwest Cape Breton. In addition to local markets, blocks are being extracted and shipped to Italy for cutting, polishing, and marketing in that region, as well as to China and North American markets. The company is making significant headway in creating new markets and, most importantly, establishing a fine reputation for their high-end products. New financing currently in place will allow the company to move forward on a number of marketing and development opportunities in the immediate future.

Precious Metals

Gold exploration in Nova Scotia is currently dominated by two junior mining companies: Atlantic Gold NL from Australia and Acadian Gold Corp from Halifax.

Atlantic Gold NL has completed an open pit feasibility study at its Moose River,Touquoy deposit where it has delineated 11.28 Mt @1.8 g Au/t for a total of 653,500 oz of gold. Confidence in these resources was gained through 10,480 metres of diamond drilling from 129 holes in addition to previously drilled holes. Company reports suggest ~98 per cent recovery with a low waste to ore ratio of 3.5:1, and high probability for additional satellite deposits in the area. Plans call for 1.5 Mt of annual throughput to recover ~90,000 oz Au per year. In addition, the company is pursuing other gold resources throughout the region.

Acadian Gold Corp. holds a large land position that includes four advanced gold districts (Beaver Dam, Forest Hill, Goldenville, and Tangier) as well as 20 other properties.Current reserves for its four main deposits are reported to be 527,536 oz in the indicated category and 826,670 oz in the inferred category, for a combined total of 1,354,206 oz of gold.The company is currently investigating the open pit potential of the Beaver Dam deposit where ore intersections of 23 metres @ 2.27 g Au/t and 36 metres @ 1.65 g Au/t were recently drilled and are indicative of the large open pit potential of the deposit. In addition to its numerous gold properties, the company recently acquired the 1,500 tonne per day mill and mineral rights to the Gays River ScoZinc Ltd (see above) lead-zinc property from HudBay Minerals Inc. for $7.5 million, and intends to move towards an open pit operation as soon as possible.

Orex Exploration Inc. acquired new financing late in 2004 to resume a detailed assessment of the former Boston Richardson mine at Upper Seal Harbour, Guysborough County, and completed a detailed resource study of its gold reserves. Resource estimates include measured reserves of 755,000 tonnes grading 1.21 g Au/t and indicated reserves of 12.5 Mt grading 0.75 g Au/t. Ongoing evaluation of recent bulk drill results suggest a gold grade as high as 3.77 g/t over a significant width in the hinge area and the company is examining the open pit potential of the deposit.

Base Metals

The former Gays River Pb-Zn mine has current reserves of 2.4 Mt grading 8.6% Zn and 6.3% Pb. The mineral zone,dated at 300 million years old, occurs as replacement minerals filling the pore spaces in a carbonate bank fore-reef environment of the Macumber Formation. This property has become a primary focus for Acadian Gold Corp. who intends to bring the mine into production in 2007.

Monster Copper Resources Inc. and exploration partner, Wallbridge Mining Company, continued an exploration program to evaluate the iron oxide-copper- gold (IOCG) potential of the Cobequid-Chedabucto Fault Zone.Avalon Ventures Ltd entered into an option agreement with private interests in the fall of 2003 to evaluate the IOCG potential near the Mount Thom Cu-Co-Au prospect, and recent work has consisted of ground geophysical surveying and additional diamond drilling. Canstar Resources Inc.continued work in the Black River area, Colchester County, to evaluate the IOCG potential of a known copper showing along the Cobequid-Chedabucto Fault Zone.

Rainbow Resources Limited carried out prospecting, geological mapping, and ground geophysics in the French Road-Oceanview area in southeastern Cape Breton County to evaluate the potential for porphyry-related base metal mineralization. Merrex Resources Inc., under an option agreement with Jubilee Minerals Ltd, completed a diamond-drilling program in the Little Narrows area,Victoria County, to evaluate the base metal potential of the Lower Carboniferous Windsor Group in the vicinity of the Jubilee lead-zinc property.Drilling is currently continuing with encouraging results.


Nova Scotia is blessed with a vibrant mining industry that includes several recently opened mines. In addition, several current projects have the potential of significantly increasing the overall size of the province’s industry. Today, mining represents an essential but temporary land use, disrupting relatively small areas for a specific (usually short) period of time, which benefits all Nova Scotia residents. When it comes to our social and cultural heritage, mining represents a total win-win situation for Nova Scotia.

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