Dec '10/Jan '11

British Columbia

Mine expansions and developments continue

Teck’s proposed second phase expansion at Line Creek is currently in the environmental assessment process | Photo courtesy of Dave Grieve


British Columbia entered 2010 with eight major metal mines and nine major coal mines in operation. During the year, Roca Mines Inc. received a permit to increase production at the MAX molybdenum mine to 1,000 tonnes per day. Western Coal Corp. re-started operations at the Willow Creek coal mine, while Barkerville Gold Mines Ltd. resumed mining activity at the QR gold mine.

Expansion is underway at a number of mines, including Endako and Gibraltar. All four mines in the northeastern coal fields are making capital investments to expand production. With continuing production and strong commodity prices, gross mining revenue in 2010 is anticipated to exceed 2009 levels.

The outlook for British Columbia is one of opportunity, with continuing mine construction at the New Afton and Copper Mountain projects. Now under the ownership of Thompson Creek Metals Company Inc., construction has started at the Mt. Milligan deposit, which is expected to begin production in 2013. Teck Coal Limited is undertaking a feasibility study to assess re-opening the Quintette Mine.

A total of 23 mining projects are in the provincial environmental assessment process and several are also in the federal process, for example, Compliance Energy Corporation’s Raven coal project on Vancouver Island.

Mineral exploration deepens

Exploration spending is expected to rebound substantially from 2009 levels. An early projection suggests $220 to $300 million for 2010. There has been a clear multi-year trend towards deep exploration at copper-gold porphyry deposits that started with New Afton. Imperial Metals carried out a large exploration program on the Red Chris project targeting high-grade copper and gold mineralization below the proposed open pit. Thompson Creek Metals is similarly exploring below the known reserves at the Mt. Milligan copper-gold mine project. Northgate Minerals Corporation is defining the higher grade core of the Kemess North copper-gold porphyry deposit and considering the potential for an underground project.

The Sulphurets gold-copper district was very active as Silver Standard Resources drilled their Brucejack and Snowfield projects and Seabridge Gold continued to advance the KSM project. Gold Fields Horsefly Corporation conducted a large drill program at the Woodjam South and Woodjam North properties, targeting copper-gold-molybdenum porphyry mineralization.

Projects targeting gold were numerous in 2010, including Blackwater-Davidson of Richfield Ventures Corp., where a major drill program followed up a 2009 breakthrough identifying a bulk tonnage target. Amarc Resources Ltd. conducted a large grassroots exploration program following identification of a bulk tonnage gold target at the Newton property in 2009. Drilling of targets at Newton is also planned. Among smaller exploration programs, Sona Resources Corp advanced its Elizabeth gold-vein project in an effort to provide start-up mill feed at its idle Blackdome Mine, and Almaden Minerals Ltd. progressed towards a second era of mining at its Elk epithermal gold-vein project.

High coal prices continued to spur exploration. Two of the larger coal exploration projects in 2010 were Canadian Dehua International’s Murray River project and Centermount Coal ’s Bingay Creek project.

Asian investment grows

Investment in the mining industry, particularly by Asian companies, continues to expand, for example, Anthill Resources’ acquisition of a 15 per cent interest in Yellowhead Mining Inc. (owner of the Harper Creek copper-gold-silver project), a $15.5 million investment by Tianjin Huakan Group in Merit Mining Corp., Centermount Coal’s acquisition of the Bingay Creek metallurgical coal property, and the Huiyong Group’s $25 million investment in Canadian Dehua International’s Murray River project. Silvercorp Metals Inc. acquired the Silvertip silver-lead-zinc project with the intention of putting it into production. In addition, Itochu Corporation and Mitsui Mining and Smelting agreed to option an interest in the Ruddock Creek zinc-lead project, and KGHM Polska Miedz S.A. and Abacus Mining & Exploration Corp. announced a joint venture to advance the Afton-Ajax copper-gold project.

Geoscience plays integral role

The provincial government in British Columbia recognizes the importance of exploration in maintaining a strong mining industry by supporting two public geoscience agencies — the British Columbia Geological Survey, operating within government, and Geoscience BC, an industry-led, non-government organization. Policy initiatives, such as the British Columbia Mining Flow-through Share Tax Credit that has been extended to December 2013, are also designed to help stimulate exploration activity.

British Columbia has streamlined government processes for critical natural resource industries to better attract global investment and is moving forward with establishing a “one project, one process” model. Starting in 2010, the province will consider sharing new mineral tax revenue with First Nations when there are mining projects or mine expansions. The first two agreements are with the Stk’emlupsemc of the Secwepemc Nation, related to the New Afton Mine development, and another with the McLeod Lake Indian Band for the Mt. Milligan project.

By Dave Grieve, Bruce Madu, Bruce Northcote, Paul Wojdak and Jim Lewis, BC Ministry of Energy, Mines and Petroleum Resources

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