June 27, 2008
Bathurst Inlet port-road loses key backer
"They're not supporting Inuit-owned companies, so why should we support them?"
JOHN THOMPSON
The Bathurst Inlet Port and Road Project, long-hailed by Kitikmeotleaders as a means of lifting their region from poverty, has lost a keysupporter.
Zinifex Ltd. now favours building its own port, west of Bathurst Inlet and just north of its High Lake property, at Grays Bay.
The port would connect to a road network that links up to thecompany's potentially lucrative Izok Lake property, which may be thesite of a zinc and copper mine by 2014, if Zinifex‘s plans go asexpected.
Andrew Mitchell, Zinifex's Canadian development manager, says thecompany came to the conclusion in May that BIPAR, as the project ispopularly known, is too expensive and too lengthy, compared with thecompany's more-direct route to the coast.
It's bad news for Charlie Lyall, president of Kitikmeot Corp. and along-time booster of BIPAR, who worries "there's not room for two portsin the region."
"I'm not very happy," he said. "The only people that are going tobenefit is Zinifex. It's not going to benefit the communities."
In Lyall's mind, BIPAR would do more than open up a region rich ingold, silver and zinc, among other metals, and diamonds, for mining.
It would also lower the cost of shipping fuel and other supplies toKitikmeot communities, and as a result lower the cost of living. And itwould allow an earlier start to a short summer construction season.
Lyall says "there's still hope" for Zinifex to rejoin the project.But, if that doesn't happen, he warns the company may face oppositionfrom the region's influential Inuit organizations.
"I hope Inuit organizations see fit they don't support the project.They're not supporting Inuit-owned companies, so why should we supportthem?"
The BIPAR project recently entered Nunavut's environmental reviewregime, with a project application submitted to the Nunavut ImpactReview Board in January 2008.
It included optimistic plans to begin work in the autumn of 2009,and have the port and connecting road, which would stretch 211-km fromBathurst Inlet to Contwoyto Lake, near the border with the NorthwestTerritories, open by the summer of 2012.
Delays or cancellation of BIPAR may hamper the development of otherpotential mines in the area, such as Sabina Silver Corp.'s HackettRiver project.
Meanwhile, Zinifex has altered its development plans, by putting itsHigh Lake zinc and copper project on hold and making Izok Lake its newpriority.
While High Lake is a bigger property, Izok Lake is believed topossess ore that is three-times as rich in zinc, Mitchell said, makingthe site far more profitable.
Izok Lake is expected to employ roughly 400 workers during itstwo-year construction, Mitchell said, and about 250 workers during itsoperation. The mine is expected to have a life of about 10 to 12 yearsas 14.8 million tonnes of zinc-rich ore is extracted.
This summer the company begins prefeasibility study andenvironmental work for Izok Lake. Zinifex hopes to submit its projectapplication to the Nunavut Impact Review Board by the end of 2008.
A peak of between 60 to 80 workers will scour Izok Lake this summer,conducting a mixture of geological drilling and environmental studiesof water, sediment and fish.
Zinc prices have softened in the past six months, dropping from$1.25/lb (U.S.) to 86¢/lb this Tuesday. But Zinifex is counting on zincprices to remain stronger than they were in the early 1990s, whenprices sunk to 50¢/lb.
If metal prices remain high, Zinifex could remain an employer in theKitikmeot for a long time. After Izok is exhausted, the company plansto move on to High Lake, which is believed to possess 17.3 milliontonnes of zinc-bearing ore.
And the company also owns the Ulu and Lupin gold properties.
This isn't the first time the owner of Izok Lake has dropped outfrom BIPAR. The property has changed hands four times since the early1990s, and with each new owner has come a different strategy for how toship base metals from the mine.
There's no sign of Zinifex giving up the property soon, although the company may soon have a new name.
If a takeover bid goes as planned, by late July the company willhave been merged with another Austrialian mining company, Oxiana Ltd.,to be reborn as OZ Minerals Ltd.