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Gold beckons again in Canada’s North Three new gold mines and work at older projects planned in Northwest Territories and Nunavut Territory Gary Park Petroleum News Calgary correspondent
Regardless of a bumpy ride lately for gold prices, there are growing hopes of a bullion revival in Canada’s North.
An array of newcomers is getting positioned to revive exploration in the Northwest Territories and Nunavut Territory, with three new mines expected to open within four years and others coming back into focus.
All this comes just weeks after the last fully operational gold mine was closed at Yellowknife.
Miramar Mining, which shut down its Con Mine in November, may also be the first out of the blocks with a new operation — a C$39 million mine on Nunavut’s northern coast, east of Bathurst Inlet.
The 1.6 million ounce resource could be in production within two years, with C$15 million budgeted for additional exploration in 2004.
As well, Miramar, enthused about predictions that gold will fetch about US$450 an ounce by mid-year, plans to spend C$25 million over the next two years developing its Goose Lake and George Lake properties, which hold an estimated 1.3 million ounces of gold about 310 miles northeast of Yellowknife. Feasibility study under way for Meadowbank Vancouver-based Cumberland Resources, which raised C$34 million last summer, is close to completing a final feasibility study for its Meadowbank project, 40 miles north of Baker Lake, Nunavut.
A C$200 million plant could be operational by late 2006, offering 250 jobs.
Toronto-based Wolfden Resources aims to start production by late 2007 from its High Lake and Ulu properties on the west side of Bathurst Inlet. High Lake is largely a copper-zinc resource with some quantities of gold, while Ulu has an estimated 565,000 ounces of gold.
The project price tag is expected to be C$80 million, including a temporary port on the Bathurst coast. Industry reports bullish about 2004 gold prices Other schemes in the works include the reassessment of an ore body near Rankin Inlet, Nunavut, by Calgary-based Comaplex Resources.
Tyhee Resources is certain there is still gold to be recovered from the long-closed Discovery Mine, 55 miles north of Yellowknife.
If combined with the nearby Nicholas Lake deposit, there could be about 500,000 ounces to recover.
Similarly, Toronto-based Seabridge Resources is taking another look at the Courageous Lake deposit that was prospected 25 years ago by Noranda and holds an estimated 3.5 million ounces of gold.
Due diligence and engineering studies are needed to determine whether the property, 145 miles northeast of Yellowknife, is a candidate for development.
Despite a sharp plunge in gold values in mid-January, triggered by a rebound in the U.S. dollar, industry reports remain bullish about the outlook for 2004.
London-based Barclays Capital predicts gold will hit US$470 an ounce before mid-year and average US$420 through 2004. GFMS, also based in London, predicts gold will ride out some volatile swings and top US$450 by June 30, while averaging US$437 for the entire year.
However, GFMS Managing Director Philip Klapwijk forecasts that jewelry demand could fall by 9 percent in 2004 after a 7.1 percent decline last year.
GFMS analyst Bruce Alway said the rising gold price will cause more miners to back away from hedging, or locking in future gold sales at fixed prices.
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