Sunday 27th September 2020

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“It’s a new NWT”

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The NWT now has two “stranded” electricity grids, connected to neither each other nor the outside world, Hoefer points out. The government’s considering ways to connect them and extend transmission to the mines. “Right now it sounds like it’s going to be a very expensive prospect,” Hoefer adds. “One of the things the NWT wants from the federal government is an increase in the territory’s borrowing limit.” He says Ottawa will likely contribute heavily to transportation improvements.

Miners welcome the Northwest Territories’ plans to encourage investment

A map displays the most advanced projects in two of Canada’s territories.
Not shown are four operating mines in the NWT and two in Nunavut.
(Chart: NWT and Nunavut Chamber of Mines)

The territory has allotted $200,000 this coming year “to evaluate the need and feasibility of a transportation corridor in the Slave Geologic Province.” It’s already home to three diamond mines, Ekati (majority-held by Dominion Diamond TSX:DDC), Diavik (40% Dominion, 60% Rio Tinto NYE:RIO) and Snap Lake (100% De Beers). With a fourth to come and extensive diamond exploration underway, the area “has the greatest potential for mineral exploration and development of any region in the NWT and Nunavut,” the government stated.

In fact, as the Chamber of Mines has pointed out, the region puts the NWT in third place for world diamond production by value.

But worrisome for a jurisdiction of 43,623 people where mining’s by far the biggest private sector industry, the NWT’s “existing mining operations have long passed their peak production,” the Conference Board of Canada reported in May. “Thus, mining output is expected to contract in 2014. However, high public sector investment, together with the anticipated development of a new diamond mine and three new metal mines this decade, will help the NWT economy grow and generate new jobs between 2016 and 2019.”

In July Fortune Minerals TSX:FT passed the final stage of permitting on receipt of a water licence for its NICO gold-cobalt-bismuth-copper project, about 160 kilometres northwest of Yellowknife. The company’s now arranging financing.

I’d say we’re probably a leader in the country for settling land claims. That helps provide more certainty.—Tom Hoefer, executive director of the NWT and Nunavut
Chamber of Mines

An environmental assessment has approved Avalon Rare Metals’ (TSX:AVL) Nechalacho rare earth elements project, 100 kilometres southeast of Yellowknife. The company’s now pursuing water licences and operating permits, as well as financing.

Canadian Zinc Corp TSX:CZN has a “fully permitted, construction-ready project” to revive the previously built Prairie Creek zinc mine 500 kilometres west of Yellowknife. Now underway is a revised pre-feasibility study, winter road permitting and, of course, financing.

About 280 kilometres northeast of Yellowknife, global giant De Beers has joint ventured with Mountain Province Diamonds TSX:MPV to open Gahcho Kué, “the world’s largest and richest new diamond mine” in the latter half of 2016. To help pay its share, Mountain Province expects to close a $100-million private placement around October 16.

“So just in the last year we’ve seen four mining proposals get approved,” remarks Hoefer. “That’s a positive signal that things are working now.”

Exploration has picked up too. “We’re now seeing a lot of interest around Gahcho Kué by junior companies and even folks who explored here way back when diamonds were first discovered here,” he adds. “They’re coming back to the NWT.”

As additional encouragement, the territory plans a marketing campaign to tell the world. Naturally, the Chamber of Mines approves. “The perception had been that the NWT is not the best place to invest,” notes Hoefer. “We need to tell people that things have changed, that it’s a new NWT and here’s why.”

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