Mining and exploration review north of the 60th parallel

A Profile of Determination

11 - 002Canadian Zinc Corporation, a Vancouver-based junior resource company, has a one-track mind these days. Its primary focus is getting the Prairie Creek Mine, located 500 kilometres west of Yellowknife in the Northwest Territories’ (NWT) Mackenzie Mountains, up and running. If the stars align perfectly, this underground mine, which contains significant lodes of lead, high-grade silver, and zinc, will begin mining in 2015, explains Alan Taylor, chief operating officer and the company’s vice president of exploration.

When that happens it will be cause for celebration – and it will be long overdue. Base metals were actually discovered on the creek side back in 1928. Exploration took off in the 50s and 60s. A fly-in camp was set up in the 70s. In 1979, the Hunt brothers, a trio from Texas, invested $65 million to build a major mine infrastructure on the site. The mine was fully permitted and three months from production when their company, Cadillac Mines, went into receivership. Canadian Zinc came onboard in the 90s and continued to investigate the potency of resource at the location. When they had defined “a significant threshold of base metal reserves that would support a mining operations for over ten years” in 2008, they applied to re-open the mine.

The water licence, which is the final required permit, has now gone to Ottawa for approval. That permit will allow Canadian Zinc to use local waters for milling and mining and will approve its plan to treat and to release, post-production, without any deleterious effects to the environment.

“We are going to refurbish an existing pond facility into a water holding pond,” says Taylor. “We will control the release of our treated effluent to the creek when it doesn’t have much flow, so we don’t alter its ecosystem.”

11 - Dale, Anita, Brian and TroyUnder normal circumstances, “permitting takes a long time,” explains Taylor. With Prairie Creek, it is taking even longer due to the remoteness of the location and the fact that it is surrounded by the ecologically-sensitive and recently-expanded Nahanni National Park Reserve. Further, the mine is in the vicinity of communities such as Nahanni Butte and Fort Simpson, both of which are hotbeds of the Dehcho First Nation, so Canadian Zinc has made it a priority to dialogue with Aboriginal populations at every stage. “We are in their backyard and they are concerned with the environment. It is easy for rumour and hearsay to spread, especially in the north.”

There is much work to be done once permitting is achieved.

The site infrastructure, which includes the mill, trailers, and bunkhouses, maintenance shops for vehicles, fuel storage facilities, and workhouses, is over 30 years old and will need a major upgrade to fix leaky roofs, upgrade electrical frameworks, and replace the mill’s diesel generators – essentially to bring the entire site up to today’s rigorous safety codes and compliances. Modules will be added to the mill building to house equipment intended to more efficiently extract the ore and thus reduce costs. There are three levels of underground workings and tunnels right now; this needs to be expanded in order to meet the ultimate goal of mining 1,300 tonnes of resource per day.

A pre-feasibility study conducted by SNC-Lavalin Group reports it will take $160 million to get the infrastructure viable for mining operations.

“At the back end of the mining process, Cadillac had originally planned to put the mill tailings into a tailings pond facility,” says Taylor. But long-term integrity becomes an issue; tailings ponds can have structural failure and can leak metals into the water system. Instead, waste product from the mill will be put back into the voids from which they were mined. “When the mine closes there won’t be any surface tailings pond legacy issues.”

11 - IMG_0038r (2)The mine is smaller than many at only 25,000 square metres. But production is expected to be robust. Canadian Zinc is basing the minimum economics on processing in excess of 5.5 million tonnes of product over 10 to 12 years. As ongoing exploration finds more ore, that mine life prediction could double.

The site will be a “fly in/fly out” facility for nine months of the year. Employees will work 12-hour shifts for three weeks then will have three weeks off. The company will provide comfortable accommodations, transport into and out of community centres, ensure lines of communications are open regarding available jobs and provide a solid employee assistance program (EAP) offering counselling, and support services.

One of the keys to mining successfully in the north is to engage key stakeholders.

Canadian Zinc is offering training programs to residents to meet employment qualification standards (it is anticipated there will be 220 employee positions needed to handle mine operations) and are offering tours of the facility and information about the mine and its impact on the local area.

They have signed a socioeconomic agreement with the Government of the NWT, which outlines a framework for how the company will maximize northern employment and how the government will garner political support for mining operations at Prairie Creek.

OLYMPUS DIGITAL CAMERAThey have created a memorandum of understanding (MOU) with Parks Canada to ensure the company’s rights of development and access to the mine are protected while simultaneously recognizing and committing to a light developmental footprint on the land.
“Working close to a national park reserve puts you under a magnifying glass. You are under close scrutiny,” says Taylor.

There are other challenging issues impacting mining development in the 21st century.

“You are dealing with the cyclicity of the markets,” he explains. “The market is soft right now. It is difficult to keep a consistent push on (for financial support) during tough times.”

And there will always be the economic development versus environmental protection debate.

“Mining gets a bad rap because of its legacy of problems but with today’s technology, all those issues can be addressed,” states Taylor. “Mining and conservation can co-exist. There is a balance and that balance needs to be met.”

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