Another Write Up One SRUKivalliq mine could last to 2030
Guy QuennevilleNorthern News Services
Monday, March 31, 2008
Kivalliq - Starfield Resources says it has enough precious metals at its Ferguson Lake project in Nunavut to create a mine that could last until 2030.
The Toronto-based exploration and development company recently released an extensive preliminary assessment of its 100 per cent owned Ferguson Lake claim, covering a total of 13,000 hectares and 240 kilometres west of Rankin Inlet.
A drill rig at Starfield Resources' Ferguson Lake claim. Starfield's preliminary assessment puts the cost of building and developing a mine at $1.35 billion. - photo courtesy of Starfield Resources Inc. |
According to the assessment, the site could annually produce 29 million pounds of nickel, 44 million pounds of copper and 3 million pounds of cobalt. The total mineral resource estimate for the site comes in at 44.2 million tons.
The study also showed a very robust pre-tax return on investment of 27 per cent at prices for nickel, copper and cobalt listed on the stock exchange two weeks ago.
"We think these returns make the project extremely viable," said Andre.
The capital costs for the mine are estimated to total $1.35 billion, with construction of the metallurgical processing plant, tank farm, pipeline, overhead transmission line and other infrastructure expected to take at least a year and a half, he added.
"This study provides all the groundwork for our feasibility study (the final project report before the permitting process," said Douchane. "We know where we want to put things. We know approximately what it's going to cost. Basically what's left to do in the feasibility study is to do the engineering and complete all the permitting.
"The reason we're not going to be done the feasibility study until 2010 is because we can't complete our permitting until the spring of 2010. So we might as well do the best job we can on the feasibility study."
By far the most unique aspect of the project is its energy generation plan. At the process plant in Rankin Inlet, the processing of the massive sulfides which host metals like copper will produce enough energy to power both the plant and the mine, with some electricity leftover for possible resale.
"With two million tons of processed ore (every year), we can actually generate an excess of 40 megawatts of power, which is more power than Nunavut uses in a year," said Douchane.
The mine will initially consist of an open pit, with plans for an underground mine to begin production a year later.
More than 600 people will be needed to staff the mine and the processing plant yearly, said Douchane.
"We want to get as many local people as we can," said Douchane, adding that Starfield has already employed a number of people from Rankin Inlet during previous summers to work as carpenters and help with environmental assessments.
"I have family and friends who work up there," said Lorne Kusugak, mayor of Rankin Inlet. "They think it's a great experience. They make really good money. The company, so far, has been really good to them. And it's good work."
Employing northerners from surrounding communities not only benefits the towns, but makes economic sense for the mining companies, said Kusugak.
"They have to draw on people from here, because if they don't, they'll have to draw on people from down south. It costs a heck of a lot more money to transport 300 people from Winnipeg to Ferguson Lake."
Hiring locally is crucial to receiving the blessing of Inuit people, he added.
"If you have 300 local people working for you, you know that there's local support (for your project). And many companies up here, they need all the local support that they can get."