Dec '07/Jan '08


Staying at the top

Ontario’s outlook remains strong

By the staff of the Ontario Ministry of Northern Development and Mines 

Exploration and development highlights

Ontario is expected to maintain its standing as Canada’s top mineral investment jurisdiction and remain among the top 10 worldwide for 2007. A rich geological environment, accessible geoscience information, highly rated infrastructure for exploration and mine development, favourable taxation policies and a stable regulatory environment continue to make the province a great place in which to invest.

Higher metal prices are reflected in the soaring values for mineral production and the continuing increases in spending on exploration in Ontario. Ontario’s diverse geology accounts for the broad spectrum of minerals being sought and produced. Although gold remains the primary focus, higher prices for other metals are leading to an increase in exploration for minerals such as uranium, molybdenum and silver.

Ontario continues to lead all Canadian provinces and territories in exploration and deposit appraisal expenditures. In 2006, spending reached $347 million and was expected to climb to $519 million in 2007. Final exploration and deposit appraisal expenditures for 2005 totalled $294 million. Spending by junior companies climbed from $50 million in 2002 to over $143 million in 2006,and now accounts for 42 per cent of exploration and deposit appraisal expenditures.

The number of mining claim units in good standing in Ontario should reach 300,000 in 2007, a new record and a significant increase over the 2006 total of 229,000. The value of assessment work filed in Ontario climbed to $88 million in 2006, up from $68 million in 2005.

Ontario retained its position as the leading Canadian province in non-fuel mineral production in 2006, as the value of production soared to $9.4 billion, up from $7.4 billion in 2005.The value of Ontario’s mineral production is comprised of metals at $6.9 billion and non-metals at $2.5 billion.A record level of $3.3 billion for the value of nickel production and dramatic increases in the value of copper and zinc production are responsible for much of the increase.

Ontario is the third leading producer of platinum group metals (PGM) in the world, behind Russia and South Africa. PGM are produced as a byproduct of nickel mining in the Sudbury area and primary production takes place in northwestern Ontario at the Lac des Iles Mine owned by North American Palladium Ltd.,Canada’s only PGM mine.

Ontario’s rich deposits have attracted the attention of the world’s leading PGM producing companies. Spending on PGM exploration in Ontario climbed from $2 million in 1998 to $24 million in 2006, as activity intensified at some of the larger projects across the province and the price of platinum moved well above $1,000 per ounce. PGM-rich properties are spread across northern Ontario, from Sudbury in the east to Fort Frances in the northwest, where high grades at MetalCORP Limited’s North Rock copper nickel PGM property have caught the attention of some senior mining companies.

Exploration and development projects

Platinum group metals

Marathon PGM Corporation is developing a property near Marathon and recently announced a resource (measured and indicated) of 68.3 million tonnes grading 0.91 grams per tonne palladium, 0.25 grams per tonne platinum, 0.09 grams per tonne gold and 0.32 copper. This translates into 1,986,000 ounces of palladium, 551,000 ounces of platinum,210,000 ounces of gold, and 493 million pounds of copper. Consultations are ongoing with the town of Marathon and local First Nation communities to determine how the parties will work together to construct the mine. A comprehensive feasibility study is expected to be completed by April 2008.

Wallbridge Mining Company Limited is actively exploring several of its interests in more than 30 exploration properties, covering in excess of 650 square kilometres of footwall rocks within the Sudbury Igneous Complex in the Sudbury area. The Broken Hammer Zone project in the North Range received much attention in 2006. At surface, the Broken Hammer Zone is a network of PGM-rich copper veins within a larger disseminated sulphide envelope. Drilling has intersected high-grade PGM values over significant widths, such as a 20.53 metre interval in Hole WIS-028 averaging 13.72 grams per tonne total precious metals. Wallbridge and partner Lonmin Plc, the world’s third largest PGM producer, have approved a $2.5 million exploration program for the area in 2008.

URSA Major Minerals Incorporated has brought the Shakespeare nickel-copper- PGM project, 50 kilometres west of Sudbury, closer to production. After two years and $6.5 million in expenditures, a feasibility study has defined a diluted probable reserve of 11,266,000 tonnes grading 0.33% nickel, 0.35% copper, 0.02% cobalt, 0.33 grams per tonne platinum, 0.37 grams per tonne palladium and 0.9 grams per tonne precious metals. The company recently completed the mining, crushing and haulage of a 50,000 tonne bulk sample to further advance its objective of developing two open pits and a 4,500 tonne per day mill.

For over five years, Pacific North West Capital Corp. in conjunction with Anglo Platinum Limited, the world’s largest primary producer of platinum, has been exploring its River Valley Project, which is located east of Sudbury in Dana and Pardo townships. More than 100 kilometres of drill core has been extracted along the northern brecciated contact of a gabbroic intrusion that has a potential contact zone of 15 kilometres in length. Over $20 million has been spent to date. The resource is estimated as: measured and indicated resources of 30.5 million tonnes containing 953,900 ounces of palladium, 329,500 ounces of platinum and 59,500 ounces of gold; with an additional 2.3 million tonnes of inferred resources containing 67,000 ounces of palladium (0.87 grams per tonne), 23,800 ounces of platinum (0.31 grams per tonne) and 4,000 ounces of gold (0.05 grams per tonne) using a 0.7 grams per tonne platinum plus palladium cut-off.


Richmont Mines Inc. (55 per cent) and Patricia Mining Corp (45 per cent) recently began producing gold from the Island Gold Mine near Wawa.Reserves include the past-producing Kremzar Mine, which has historical (pre NI 43-101) proven and probable reserves of 181,944 tonnes at 6.27 grams per tonne gold and possible reserves of 85,952 tonnes at 8.67 grams per tonne gold. Production of over 34,000 ounces is forecast for 2007 and should increase to over 57,000 ounces in 2008.

Southern Star Resources and Exall Resources were rewarded for their intensive drill program on their Gold Eagle Mine property near Red Lake with several high-grade gold intersections in the Bruce Channel zone of up to 107.7 grams per tonne gold over 3.8 metres. Estimates of the mineralized envelope of the zone were increased to 1,100 metres vertical, 450 metres northwest-southeast and 615 metres northeast-southwest. The partners, each with a 50 per cent share in the project, are spending about $11.4 million in 2007.

To attain its goal of producing one million ounces of gold by 2010, Goldcorp Inc., the world’s richest gold producer, is investing $23 million in underground exploration and development in its Campbell and Red Lake mine complexes in 2007. Due to the significantly expanded Red Lake land package (41,000 hectares) that came with its buyout of Placer Dome’s Campbell Mine and associated mineral properties, Goldcorp is spending approximately $9 million on surface exploration within the greenstone belt. Goldcorp recently announced that it has acquired the remaining 31.9 per cent interest in the Musselwhite gold mine and the remaining 49 per cent interest in the Porcupine Joint Venture from Kinross Gold Corporation in exchange for a cash payment and 50 per cent ownership of the La Coipa Mine in Chile. This acquisition will give Goldcorp 100 per cent ownership of the Porcupine Joint Venture and the Musselwhite Mine.

Pelangio Mines Inc. now has a 50 per cent equity ownership in Detour Gold Corporation after the sale of its Detour Lake property to Detour Gold Corporation. The objective of the sale was to help move the property through the development stage. The Detour Lake property hosts a near-surface mineral resource of 3.4 million ounces of gold at the location of the former Detour Lake Mine, which produced 1.8 million ounces of gold from 1983 to 1999.

Lake Shore Gold Corp. received a prefeasibility report on mineral reserve estimates at the Timmins West gold property that indicates production may be possible by 2009, with annual average production of 71,000 ounces of gold. The property has probable reserve estimates of 3.4 million tonnes containing 826,000 ounces of gold at 7.59 grams per tonne. The company owns the Bell Creek mill and associated infrastructure, which will reduce future development costs and provide new options for processing mineral products from gold projects. Lake Shore has commenced an advanced underground exploration program that includes sinking an underground exploration shaft.

Rainy River Resources Ltd. continues drilling at the Rainy River gold project with the program tracing the 17 and ODM Zones down-plunge below the 300 metre level. A total of six gold-dominant polymetallic zones have been identified within the anomaly, of which five are located along the 17 Gold Trend. Drilling is also revealing new gold zones in the area with high pyrite content.

Kirkland Lake Gold Inc. has discovered at least 14 new gold-bearing zones south of the Macassa Mine workings at the South Mine complex area in Kirkland Lake. These discoveries are now the main focus of exploration and a cross cut is being driven from the 1,615 metre level to gain access to the zones and conduct close-up exploration. Drilling has confirmed continuity of the high grade over a strike length of 21 metres and a dip component of 15 metres. Definition diamond drilling is being conducted at St Andrew Goldfields Ltd.’s Holloway-Holt gold project near Kirkland Lake where development efforts are underway. Preliminary work is being conducted to re-commission the Holt gold mill in preparation for a production decision.

Base metals

CVRD Inco recently announced that they will spend $11 billion worldwide in 2008 — the largest annual investment program ever undertaken by any mining company in the world. Sudbury area projects will continue to play an important role in these activities as $68 million will be spent next year on the Totten project and on other development projects such as Copper Cliff Deep and Creighton Deep will be advanced. The company expects to double its spending on exploration and strategic studies in the Sudbury area with expenditures of over $50 million planned for 2008.

Liberty Mines Inc. commenced production at the Redstone Mine near Timmins in May 2006. The Redstone Mill was commissioned in July of this year and underground drilling provided a measured and indicated resource of 418,931 tonnes grading 2.32 per cent nickel to and above the 508 metre level of the mine.

FNX Mining Company Inc. is achieving notable results from exploration of its footwall properties at the Levack Mine near Sudbury, Ontario’s newest base metal mine. Drilling at the Levack Footwall Deposit is expanding reserves and intersecting high-grade mineralization of nickel, copper and precious metals. Exploratory underground drilling is also underway at the Podolsky Project to upgrade the resource classification for mine planning since full commercial production should be achieved by the end of 2008.

Xstrata Nickel is continuing its growth strategy in the Sudbury area and recently announced that it will invest $8.7 million in the Thayer-Lindsley Mine to extend mine life by at least one year. The company also views the Nickel Rim nickel project as an important part of its growth potential, with an inferred resource of 13.4 million tonnes of mostly nickel,copper, platinum and palladium. The $850 million project should begin annual production of 1.25 million tonnes of ore in 2010. Development and exploration work also continues at the Fraser- Morgan property and other Sudbury area mine properties.


De Beer’s Victor Diamond Mine, located in the James Bay Lowland, is expected to open in 2008 and operations there will create 375 full-time jobs. This mine is the largest project underway in northern Ontario and is expected to produce about 600,000 carats annually. Following the signing of Impact and Benefits Agreements with Attawapiskat First Nation, and more recently with Moose Cree First Nation, the company is continuing to work with other Aboriginal communities in the area. De Beers continues to investigate the economics of other kimberlites in the vicinity of the Victor pipe.

Metalex Ventures Ltd. continues to bulk sample the T1 kimberlite, located approximately 80 kilometres west of the Victor diamond project. A total of 896 diamonds were recovered from 1,992 kilograms of kimberlite, yielding an average diamond count of 420 diamonds per 100 kilograms. To date, 88 tonnes of a planned 200 tonnes minibulk sample have been collected.


RPT Uranium Corp. (formerly Rampart Ventures Ltd.) completed a summer diamond-drilling program on the Split Rapids Zone in the Sibley Basin in northwestern Ontario. Its claims are located approximately 100 kilometres north-northeast of Thunder Bay. Stripping is underway at some of the properties, such as Frazer Creek and the Malborne Lake claim group. Shallow drilling has intersected 2.99% U3O8 across 1.5 metres; grab samples have assayed as high as 19.9% U3O8. A magnetic survey will be flown on some of the properties in the claim group.

Canadian Wollastonite continues development of the St. Lawrence deposit, a high-grade wollastonite deposit north of Kingston. Bulk testing and process design is complete. The project is in the final stages of pre-production engineering and development. Construction of a 1:5 scale pilot plant is underway.

Ontario – committed to mineral development

The Ministry of Northern Development and Mines released Ontario’s first ever Mineral Development Strategy. An important element of the strategy supports Ontario’s vision for a new research and development centre in Sudbury, the heart of the world’s largest mining area, to keep the province at the forefront of this highly competitive, technology-driven industry. The province helped fund the Centre for Excellence in Mining Innovation at Laurentian University whose focus is on mining exploration, deep-mining research, integrated mine process engineering, telerobotics and automation, and environment and reclamation.

Improving service

Ontario is working with industry and other ministries of the provincial and federal governments to improve regulatory efficiency without compromising environmental responsibilities associated with mineral development. With industry and other ministry participation, a web-based repository for all permitting and approvals information was developed. The new website provides a centralized location to access information, advice and regulatory requirements as well as online services from various ministries related to the full range of mine development activities, from prospecting through mining to reclamation and closure. Ontario is committed to sustaining global confidence in its well-earned reputation as a leading jurisdiction for mining and is working to address issues such as sustainable development, land rights and the interests of First Nations.

A wealth of geoscience information

The Ontario Geological Survey (OGS) Branch of the Ministry of Northern Development and Mines provides extensive and objective information on Ontario’s geology and its world-class mineral resources. Mapping and data collection programs are being undertaken by the OGS throughout the province.

Unparalleled access to data

The ministry has made tremendous progress in digitizing as well as increasing and improving access to its data. The award-winning ClaimMap system of monitoring and illustrating claim staking activity throughout the province is second to none. Geological data is available at GeologyOntario, a state-of-the-art website that provides unparalleled electronic access to a wide range of geoscientific data, including all Ontario Geological Survey publications, maps and assessment reports. The data can facilitate and support investment and landuse decisions.

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