Dec '06/Jan '07

Newfoundland and Labrador

Newfoundland and Labrador continue mineral strength

Information sourced from the Newfoundland and Labrador Department of Mines and Energy

Mineral exploration in Newfoundland and Labrador is projected to top $79 million for 2006, a significant increase over the previous year. Indications suggest the strength of the province’s mineral industry will continue into 2007.

The Newfoundland and Labrador mining and exploration industry is valued in excess of $2.6 billion and provides the equivalent of more than 3,450 full-time jobs. Under the Mineral Incentive Program, government funding has increased by 55 per cent this past year, to help foster growth to meet current global demands. As well, the budget of the Geological Survey Division was expanded this year by $500,000, helping to increase basic research to stimulate and manage development of mineral resources and attract new investment while providing geoscientific support for ongoing exploration.

The mining industry in Newfoundland and Labrador produces more than a dozen mineral commodities, including aggregates, iron, limestone, nickel, granite, and copper wire. Over the past five years, the value of the province’s mineral shipments increased by 244 per cent to a forecast of approximately $2.59 billion for 2006, up from $1.42 billion in 2005.

There are 144 exploration companies active in the province, suggesting future operations. The forecasted claims in good standing were for 140,000 in 2006, up from 88,546 in the previous year. This will result in expenditures of $50 million in Labrador and $33 million in Newfoundland.

Mining projects

Atlantic Minerals Limited operates limestone and dolomite quarries at Lower Cove on the Port au Port Peninsula. Product from the modern 2 million tonne per year processing plant and deepwater shiploading facilities are sold to the iron ore industry in Labrador and Quebec, and exported for various chemical and industrial uses. Total shipments are forecasted to increase to 1.7 million tonnes for 2006.

In the St. George’s Bay area, Galen Gypsum Mines Limited is forecasting an increased tonnage of 65,000 tonnes of gypsum for 2006.

Peat moss processing company Hi-Point Industries has developed its Island Pond bog near Gander Bay highway and is expected to begin small-scale production this year.

Hurley Slate Works Company ships roofing slate and flagstone from their slate mine and plant in Britannia Cove/Nut Cover, Trinity Bay, and forecasted an employment increase this past year from 46 to 56 employees.

The Iron Ore Company of Canada Ltd is a longtime producer in Labrador and will continue to be for the coming years at their mine, concentrator, and pellet plant at Carol Lake.Annual mine production at the open pit operation is in the 35 to 38 million tonne range, at an average grade of about 40 per cent total iron.With strong market demand, the shipment forecast for 2006 was estimated at 16.2 million tonnes. Onsite employment is around 1.350 people.

IOC mines its own dolomite for making fluxed pellets in Labrador West. The Leila-Wynn quarry is expected to close in 2007, to be replaced by the Plateau dolomite quarry. Estimates are that Plateau will produce 200,000 tonnes per year over a 20-year life.Drilling has already commenced, and quarrying is projected to begin in late 2007.

Shabogamo Mining & Exploration Limited has a contract to supply quartzite to Bécancour Silicon in Quebec from its Roy’s Knob quartzite deposit near Labrador City. Shipments in 2006 are estimated at 55,000 tonnes.

Torngait Ujaganniavingit Corporation, a subsidiary of the Labrador Inuit Development Corporation, expects to quarry around 600 cubic metres of anorthosite at Ten Mile Bay near Nain this year, down from 2005 levels due to the strengthening Canadian dollar and increased fuel costs.

Voisey’s Bay Nickel Company Limited forecasted 2006 shipments of nickel contained in concentrate to be approximately 56,000 tonnes, 35,000 tonnes of copper contained in concentrate, and 900 tonnes of cobalt contained in concentrate. Exploration activity is ongoing and producing results. Last January,VBNC announced a change to the proposed processing plant site from Argentia to one at Long Harbour. However, the Minister of Environment and Conservation concluded there are potential environmental effects, so VBNC must prepare an Environmental Impact Statement.

Wabush Mines currently operates a mine and concentrating plant at Wabush and a pellet plant and shipping facilities in Point Noire, Quebec. This year’s shipments were forecasted at approximately 5.3 million tonnes.

Developing projects

A number of projects are in the development stages throughout the province. Anaconda Gold Corp’s Pine Cove Gold deposit in Baie Verte has submitted documents required by the Mining Act, and is projecting a mine life of 15 years, for a total production of 206,468 ounces.

Atlantic Barite Limited is reactivating the Buchans Barite plant and expected to begin commercial production in 2006, for a mine life of 15 to 20 years.

Aur Resources Inc.’s Duck Pond project in Central Newfoundland has proven reserves of 4.1 million tonnes at an average grade of 3.3% copper, 5.7% zinc, 59 g/t silver and 0.9 g/t of gold. Production was projected for late 2006 at this underground operation, expected to produce 1,800 tonnes per day.

Near Glenwood, Beaver Brook Antimony Mines Inc. is currently exploring financing arrangements to reopen their mine. Meanwhile, Freeport Resources Inc. continues to evaluate and conduct research for the garnet sands in their Hutton beaches deposit.

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