Crowflight Minerals Inc., the holder of over 700 square kilometres of exploration property in the Thompson Nickel belt, is in the process of moving from exploration to production.
The development in question is the Bucko Lake deposit, part of the TNB (Thompson Nickel Belt) South project. Located near the town of Wabowden, the site is just over 100 kilometres south of Thompson, Manitoba. Crowflight’s consultant, Micon International, completed an updated feasibility study early this year, and Crowflight hired Met-Chem Consulting of Montreal to complete the detailed engineering and assist in project management of the construction. In addition, Crowflight hired Boge and Boge of Winnipeg, Manitoba, to supplement the construction management team. The contract mining firm Dumas Contracting has begun underground activities on the site. The underground mining operation is expected to begin production in the second quarter of 2008.
The site has been known since the late 60s, says Crowflight’s president and CEO Mike Hoffman, but was never developed by the then-owner Falconbridge. The most likely reason for this was the deposit’s relatively small size. The mine is expected to produce just short of 5,700 tonnes of nickel a year, which is a very small amount indeed when compared to today’s global production of over 1.4 million tonnes.
Despite the project’s comparatively small size, things look promising. “We used a US$8/lb nickel price in our estimates,” said Hoffman, “so anything north of $8 per pound will be an improvement on the predicted economics of the project.” Right now, nickel prices are floating around the US$14/lb, with predictions that growth in global demand will continue to outstrip the growth in supply. The site boasts excellent infrastructure, which should help keep the transportation costs down. Wabowden is a mere two kilometres away, and Highway 6, one of two main north-south routes in the province, is five kilometres farther. “There is also a rail spur 1.5 kilometres away,” added Hoffman.
Although new to Crowflight, Hoffman is particularly impressed with the depth of the Crowflight operating and exploration team. “Our operations group, led by Paul Keller, and our exploration group, led by Greg Collins, have been able to assemble an impressive and experienced team. This depth of experience is unusual for a junior mining company at this stage,” said Hoffman.
The support of the local community of Wabowden and the First Nations community of Cross Lake has been very helpful. “It is very important to Crowflight that our local stakeholders benefit from our activities. Between ourselves and our contractors, we are committed to local training and hiring. It makes good business sense to use local people. We have updated the local communities on our plans and we plan to continue this practice through the mine development and operating life,” added Hoffman.
As part of Crowflight’s off-take agreement, the 17 per cent contained nickel concentrate will be shipped and further processed by Xstrata Nickel, who will then sell the metal on the open market.