B.C. Rejects Mine
B.C. Rejects Mine: But was the government decision environmental or political?
By ResourceClips
Another British Columbia mine proposal has flunked its environmental review for reasons that might not be environmental. But the company, Pacific Booker Minerals TSXV:BKM, vows to continue with its Morrison copper-gold-molybdenum proposal for north-central B.C.
It was back in 1998 that the company began drilling the property, which is directly east of Morrison Lake, home to a genetically distinct type of sockeye salmon. The environmental assessment process began in 2003 and in 2009 the company applied for an environmental assessment certificate. On October 1 Pacific Booker announced that two B.C. government ministries refused to grant the certificate. They based their decision largely on the possible failure of environmental mitigation and opposition from local natives.
“We plan to move forward,” company Director Erik Tornquist tells ResourceClips. “We were required by law to do an effects assessment to determine whether there were any significant adverse environmental, social, heritage, economic and health effects, which we did. Our findings were supported by three third-party reviews. The environmental assessment concluded there were no significant adverse effects. The report that went to the minister from the EAO [Environmental Assessment Office] and dealt with the various components, like water, fish, wildlife, etc., determined that there were no significant adverse effects. Well [the government says], ‘What about the risk?’ But it’s not a risk assessment, it’s an effects assessment.”
Indeed the EAO’s August 21 207-page report addressed some 16 concerns, mostly related to the environment but also issues such as heritage, economic effects, social effects, cultural foods and native land title. The conclusions repeatedly stated that, with successful implementation of mitigation measures and conditions, the mine is “not likely to have significant adverse effects.”
A September 20 report by EAO Executive Director Derek Sturko reiterated those conclusions. But he recommended the government take a “risk/benefit approach” that considers what might happen if mitigation measures, especially those affecting Morrison Lake, prove unsuccessful. Sturko also emphasized strong native opposition and “moderate to strong prima facie case for aboriginal title.” He recommended the government reject the proposal. Environment Minister Terry Lake and Energy, Mines and Natural Gas Minister Rich Coleman did just that in a September 28 letter which was publicly released October 1.
An October 2 statement from the Lake Babine Nation said that two former copper-gold mines “continue to leach toxic acid and metals into the lake. Concern that the Morrison Mine would add to the cumulative discharges from the two closed mines was a recurring theme raised during the assessment process.”
The government decision was only the second time a mine has been rejected in the history of B.C. environmental reviews. In 2008 Northgate Minerals (now AuRico Gold [T.AUQ] failed at both the federal and provincial level to get approval for a $200-million open-pit expansion to the now-closed Kemess South Gold-Copper Mine. Last year the Canadian Environmental Assessment Authority rejected Taseko Mines’ TSX:TKO Prosperity Gold-Copper Project, even though it passed B.C.’s environmental review. The federal agency expressed concerns about Prosperity’s potential effects on established native rights, potential rights, potential title and culture. In September Taseko re-applied with a $300-million revision for what is now the $1.1-billion New Prosperity proposal.
But currently the most controversial proposal in the always controversial subject of B.C. resources is the Enbridge Northern Gateway pipeline.
In an October 2 column, Vancouver Province writer Michael Smyth suggested the provincial government’s opposition to Enbridge is purely political: “With the pipeline so unpopular in B.C. right now, it seems [Premier Christy Clark] was determined to pick a fight, and hope that earns her points with B.C. voters.”
Clark’s BC Liberal party is trailing far behind the opposition New Democratic Party, which is generally expected to win the provincial election next May. The NDP’s 1991 to 2001 period in office, however, was rated a disaster by the mining industry.
B.C.’s environment minister denied any connection between the government’s Enbridge stance and his Pacific Booker decision. Lake told Canadian Press (in a story published by CBC), “It would send a very negative message to the investor community if we were to pick things to say ‘No’ to just to make a point.”
Speaking to ResourceClips, Pacific Booker’s Tornquist says, “We’re at a loss on how you can have a project with no significant environmental effects yet a certificate is denied. We have to look at our options here. It’s a bit early. The phone’s been ringing off the hook. On the federal side, I talked to the federal government yesterday [October 1] and they’re continuing with their process and their decisions are made independently.”
Stuart Bertrand, a Public Affairs Officer with B.C.’s Ministry of Environment, informs ResourceClips that the decision can’t be appealed. A judicial review may be possible if there are perceived violations of the environmental assessment act. Otherwise the company can submit a new application “with a new project design, as a decision has now been made that the current design is not acceptable.”
The Morrison proposal had proven and probable reserves of 1.37 billion pounds copper, 658,090 ounces gold and 10.05 million pounds molybdenum. A February 2009 feasibility study projected a conventional open pit with a 30,000-tonne-per-day mill for a capex of $516.68 million, with a pre-tax IRR of 20.05%, an NPV of $495.9 million at an 8% discount rate and payback in 4.2 years.
Pacific Booker shares opened and closed October 1 at $14.95, just five cents short of its 52-week high. But on October 2 they opened at $5.11 and closed at a 52-week low of $4.95.