Golden opportunities for an open pit in Matachewan.

Geologists and drill rigs have been familiar sights around Matachewan for years.

But the prospects of Northgate Minerals operating an open pit gold mine west of town by late 2009 has the sleepy community of 360 residents buzzing with an excitement, not seen in these parts for years.

A new bridge to handle the expected mining activity at Northgate's Young-Davidson project is under construction, contractors and heavy equipment are being mobilized, and incoming workers are searching for places to bunk down.

Accommodations are in short supply, says Township CAO Andrew Van Oosten.

"It's so busy that for the first time in my recollection we're approaching zero per cent vacancy. You can't rent or buy a place here right now."

Van Oosten anticipates anywhere from 15 to 30 new home starts this year, "which is exceptional. Nothing's been built here in years," he adds, laughing.

The tiny back-to-nature northeastern Ontario community at the end of Highway 66, bills itself as the place 'Where the roads end and where the adventure begins.'

But Northgate's 11,000-acre gold property west of town is also situated along the Kirk-land-Larder Lake trend, which has been an historic producer of 34 million ounces of gold.

"If the mine needs 250 to 300 people, I could see Matachewan double in size," says Van Oosten.

Like many Northern towns, Matachewan has ridden the boom and bust cycles of mining. The Young-Davidson property has been in production off and on since the 1930's with a succession of companies having come and gone including Hollinger Mines, Matachewan Consolidated, Royal Oak Mines and Young-Davidson Mines.

And there's always been plenty of active junior companies exploring for gold, copper and diamonds.

Though the town's water treatment plant can support a population twice its size, Van Oosten says the community is wise enough not to get caught up in any exorbitant building boom given the town's historic size.

"We did well (during previous mineral cycles) and when that was exhausted, the town was depleted. We were at the bottom of our cycle a year and a half ago. Now with this new activity, the prospects for the future is looking exceptional for the next 10 to 15 years."

There's now exploration-related work for locals who normally work elsewhere, there's more people paying municipal taxes and there's the possibility of more money for township coffers once building permits for the mine's surface buildings are filed.

An old timber-framed bridge across the Montreal River is being replaced with a new $10.9 million steel and concrete structure on Highway 566 to handle mining and logging activity.

Miller Paving has built a portable concrete plant for the bridge pours and to service all the activity, including foundations for new homes.

Northgate's exploration and development has advanced quite rapidly since the first drill rig appeared on the property in early 2006, after finalizing a merger agreement with Young-Davidson Mines only months before.

This year, Northgate plans to spend $28 million (US) in surface and underground exploration.

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Dumas Contracting has begun driving an exploration ramp down 1,500 feet to reach a portion of the measured and indicated gold resource of 1,063,060 ounces spread out over three zones. Underground diamond drilling begins later this year.

The Timmins mine builders are also dewatering the old mine workings of a 2,200-foot shaft built by Royal Oak Mines which also erected a headframe in the late 1990's until the project ran out of money.

Northgate intends to rebuild the hoist house and re-install the hoist in preparation of getting back underground.

The plan is to build an open pit mine before eventually moving underground. Northgate has started a pre-feasibility study to assess the project's economics, says Luc Guimond, Northgate's Young-Davidson project manager.

"Eventually if we're successful with our program here ... the intent would be to build a new (on-site processing) mill."

The gold zones would be accessed by both open pit and from underground. The mine workings from the No. 3 shaft would be connected to the pit. "There's a number of smaller pits that were mined out on surface in the 1970's that are tied into the underground workings," says Guimond.

The company reports mineralization extends down 2,500 feet but no deeper drilling has ever been attempted. And what excited Northgate's geologists is other area working mines along the trend have mineralization extending down past 7,000 feet.

With 40 contractors on site, many of them local, Dumas is on a hiring blitz for supervisors, surveyors, mechanics, electricians, scoop and truck operators, shaftsmen and hoistmen.

Northgate's 18 employees could be boosted to a mining workforce of 200 once in commercial operation.

"Matachewan's not big," says Guimond, "but for eligible, fit workers in the community, there's a very good chance they'll be able to secure employment with the mine."

Besides Northgate, there's plenty of other activity around Matachewan.

Pacific Comox Resources is exploring for copper and molybdenum to the northwest, while Golden Chalice Resources to the southwest was drilling through the winter on its copper and gold property. Alexandria Minerals is identifying drill targets for gold to the east. Other miners like Apollo Gold, Temex Resources and Tres-Or are exploring for silver, gold and diamonds in nearby townships.

Last year, the Ontario Geological Survey offices in Kirkland Lake filed $17.4 million worth of assessment work. "That's the most we've ever had," says District Geologist Dave Guindon, encompassing more than 100 exploration projects with more than 25 drill rigs operating.

www.northgateminerals.com

www.matachewan.com

By IAN ROSS 

Northern Ontario Business