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Vol. 12, No. 30 Week of July 29, 2007
Providing coverage of Alaska and Northwest Canada's mineral industry

MINING NEWS: NWT uranium exploration plan rejected

Region too spiritually significant, according to regulator, and Ur-Energy must now wait for final decision by federal minister

Sarah Hurst

For Mining News

The mining industry is concerned about its future in Canada’s Northwest Territories in the wake of the Mackenzie Valley Environmental Impact Review Board’s decision in May to recommend against a uranium exploration project that was proposed by Manotick, Ontario-based Ur-Energy. The company hopes to explore near Screech Lake in the Upper Thelon River basin. Canada’s Indian and Northern Affairs Minister Jim Prentice will now decide whether or not to accept MVEIRB’s recommendation.

Uranium exploration is quite similar to the diamond exploration that has been going on in the Northwest Territories for years and has led to the development of two operating diamond mines, Ekati and Diavik, according to Ur-Energy. In one of the documents that the company submitted to MVEIRB, it says that the exploration program would consist of three components: a combined airborne magnetic/electromagnetic survey; a ground geophysical survey; and ground sampling and prospecting. “None of these components leave an environmental footprint, and all are common to diamond exploration,” geologist and field manager John Charlton wrote.

The main difference is that uranium exploration can involve radioactive materials. If highly radioactive mineralization is intersected by drilling, there are mandatory procedures to be followed, Charlton explained. The material is physically isolated from the immediate camp area and then moved in specially designed containers to a facility designed for the storage of radioactive material, as is done in Saskatchewan uranium exploration. Radioactive measurements are taken at the drill site at the completion of each drill hole to monitor any contamination.

Ur-Energy intended to use a helicopter-portable drill to drill up to 20 holes in targets ranging from 1.5 to 20 kilometers from the Thelon River during winter and spring. A small camp was proposed and all access was to be by helicopter from Yellowknife.

Board said there would be ‘adverse cultural impacts’

“It is the Review Board’s opinion that this development, in combination with the cumulative effects of other present and reasonably foreseeable future developments in the Upper Thelon Basin, will cause adverse cultural impacts of a cumulative nature to areas of very high spiritual importance to aboriginal peoples. These impacts are so significant that the development cannot be justified,” Gabrielle Mackenzie-Scott, the chair of the MVEIRB, wrote in the environmental assessment decision.

During the review process the MVEIRB heard from aboriginal groups, non-governmental organizations, government, ecotourism operators and members of the public. Aboriginal groups talked about the spiritual significance of “the place where God began”, and ecotourism operators called the Upper Thelon basin “one of the most spectacular wildlife areas left on the planet”, according to the MVEIRB.

The aboriginal people “see industrial development, including this proposed development and others, as a desecration of a spiritual area of intrinsic value,” the MVEIRB wrote. “The Review Board is of the view that although the proposed development is physically small, the potential cultural impacts are not.”

Concern was also voiced by the government of the Northwest Territories and the Beverly Qamanirjuaq Caribou Management Board, who stated that the proposed development is on the main caribou migration route of the Beverly caribou herd and that it would be operating during the pre-calving period when pregnant caribou are particularly vulnerable. In order to mitigate cumulative effects on the caribou in the future, the MVEIRB suggests conducting a Caribou Cumulative Effects Study, including an examination of the health and sustainability of the Beverly herd.

Miners say board may have exceeded jurisdiction

Mining industry representatives wrote letters to Indian and Northern Affairs Minister Jim Prentice in support of their case following the decision, and opponents of the project wrote asking the minister to uphold the MVEIRB’s recommendation. “The mineral industry believes that, in reaching these conclusions and making the resulting recommendation, the Review Board has strayed from its mandate and appears to have exceeded its lawful jurisdiction,” the heads of the Prospectors and Developers Association of Canada, the Mining Association of Canada and the NWT and Nunavut Chamber of Mines wrote in a joint letter to Prentice May 25.

“The Board appears to have assessed some larger, undefined project capable of having the significant adverse impacts that the Board has enumerated instead of focusing on the likely impacts of the specific application that was before it,” the letter continues. “We would also point out that the exploration programs carried out in the Upper Thelon River basin in the 1970s and 1980s involved over 100 diamond drill holes that we understand had little, if any, lasting effect.”

If implemented, the MVEIRB’s recommendation would result in a large area of the Northwest Territories that is believed to have significant mineral potential to become entirely off limits to further mineral exploration or development, “entirely without regard to the well-established process for creating protected areas under the Protected Areas Strategy or the National Parks Act,” the letter says.

The mining industry has made significant contributions to studies of caribou in the Northwest Territories, the letter says. The industry is currently responsible for approximately half of the Northwest Territories’ GDP and some 2,500 direct jobs, it notes. There have been no significant new discoveries in the Northwest Territories since the early 1990s, and given the long lead times for developing mines, the region will see a decline in the contribution of mining to the economy if new discoveries are not made soon, the letter says.

Ur-Energy charges exploitation by special interest groups

“It appears that special interest groups are exploiting the review process to further political, cultural and environmental causes and are thwarting established regulatory and legislative procedures. We believe that the Review Board has been strongly influenced by these groups,” Ur-Energy’s president and CEO, W. William Boberg, wrote to Jim Prentice May 29.

Since acquiring mineral rights at Screech Lake in September 2004, Ur-Energy has spent more than C$3.5 million, including over C$400,000 on environmental studies, according to Boberg. In July 2006 the company applied to the Mackenzie Valley Land and Water Board for a land use permit to conduct an exploratory drill program at Screech Lake. The proposed program was virtually identical to one conducted by Uravan Minerals on a property adjacent to the Screech Lake claims. Uravan received its land use permit within two months after applying in March 2006 and the MVLWB didn’t refer that exploration program to an environmental assessment by the MVEIRB, Boberg wrote.

Public concerns that the land would be destroyed, the water would be poisoned and the caribou would die — and that uranium is used for nuclear power that kills people — were given credence by the MVEIRB but were stirred up in part by anti-mining special interest groups, Boberg wrote. “Ur-Energy’s proposal for development has been singled out, for no valid reason, for broader social, economic and cultural concerns without any regard for the rights of Ur-Energy or the procedures and requirements of the Act under which the processes of the Review Board are governed,” he concluded.

“To be blunt, the MVEIRB has demonstrated that it is incapable of separating political posturing and rhetoric from reality,” Gordon Clarke, president and CEO of Vancouver-based North Arrow Minerals, wrote to Jim Prentice June 4. “In my case, my company is in the position to invest in the Northwest Territories and I possess considerable knowledge of its geology and potential. Currently I have serious reservations about initiating any new projects or investing in a significant portion of the Northwest Territories. I also know other mining company executives with the same opinion.”

Strongbow ‘will be seriously affected’

“Strongbow Exploration will be seriously affected by this decision, as our primary exploration property is located in the southeast corner of the Akaitcho region of the NWT, where a $3 million nickel exploration program is currently under way,” Vancouver-based Strongbow’s president and CEO, Kenneth Armstrong, wrote to Prentice June 6. “We are also involved in two uranium exploration projects in the Thelon basin as part of a joint venture partnership with Bayswater Uranium Corporation,” he added. The decision on Ur-Energy makes it much more difficult for Strongbow to attract investors, Armstrong wrote.

In a separate setback, Strongbow announced July 3 that exploration of its Nickel King project in the Northwest Territories had been temporarily suspended due to a fire that destroyed the 16-20-man exploration camp. There were no injuries and all personnel were safely evacuated to Stony Rapids, Saskatchewan. The diamond drill at the property was undamaged, but the planned July 10 start date for the summer drilling program was to be postponed, probably by about one month, until new camp facilities can be constructed with the assistance of Discovery Mining Services.

The fire was not set deliberately, and its cause is being investigated, Armstrong told Mining News.

“The mining special interests have a profound misunderstanding of the intrinsic significance of the upper Thelon from the perspective of the Dene people, and indeed of many Canadians,” Chief Adeline Jonasson of the Lutsel K’e Dene First Nation wrote to Jim Prentice June 7. “The significance of the Thelon to our people as a center of our civilization, our history, our spirituality and our lifestyle cannot be overstated. To allow mineral exploitation to proceed in the region without careful planning and consideration is tantamount to allowing the desecration of our church, our grocery, our graveyard and our museum. Such sacrilege is nothing less than expediting the demise of our unique culture and way of life.”



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