Printer Friendly

Vancouver firm plans to reopen Pickle Lake mine later this year.

Vancouver firm plans to reopen Pickle Lake mine later this year

After lying dormant for almost a decade, the former Union Miniere Explorations Corp. Ltd. Umex Thierry Mine in Pickle Lake could be back in production by the end of 1992.

Etruscan Enterprises Ltd. of Vancouver purchased the copper and nickel mine from Belgium-based Umex last November for $800,000 and a five-per-cent net smelter royalty.

"We're very pleased with the price, especially when you consider that in excess of $100 million was spent at the site," said Gerry McConnell, president of NovaGold Resources Inc. which holds a 54-per-cent stake in Etruscan: "There is a substantial infrastructure already in place at the mine."

During an interview from his Halifax, N.S. office, McConnell said a preliminary report on the Umex site was encouraging and that steps to bring the mine back into production could begin later this year.

"The preliminary report from Watts, Griffis and McQuat (a Toronto consulting firm) indicates that the mine can be successfully reopened in a staged process," McConnell noted.

McConnell said the two main stages of the program involve reopening the underground operations and refurbishing the mill to operate at a rate of 1,000 tons per day, as well as opening a low-grade open-pit mine.

The pit, dubbed K-1-1, is estimated to contain 55 million tons of ore with a copper grade of .315 ounces per ton and a nickel grade of .11 ounces.

According to McConnell, a reduced production rate, as well as preconcentrating the lower grade minerals before they reach the mill will ensure the mine's success.

Waste rock will be removed from the material destined for the mill circuit before it leaves the open pit, allowing the company to double the amount of copper and nickel being processed by the mill.

The first phase of the site's reopening has been scheduled to begin in the middle of this year, at an estimated cost of $15 million. The two-year, two-stage program is expected to cost upwards of $44 million.

"Umex did a lot of studies after the mine was closed (in 1982) and they came to the conclusion that the reserves and the mine were not suited to production levels of 4,000 tons per day," McConnell noted.

He added that by producing at the 4,000-ton-per-day rate, the former owners were "force-feeding" the mill. The resulting dilution of the minerals, coupled with reduced metals prices, "spelled doom" for the mine, noted McConnell.

Etruscan will also utilize data collected by Umex when it embarks on an exploration program around the mine site sometime this year.

"We will be following up on Umex's work," McConnell said. "We believe there are additional copper, nickel and precious metal deposits in the Pickle Lake area."

The exploration program is expected to carry a price tag of between $300,000 and $400,000.

While noting that it is too early to set employment levels for the site, McConnell said he would guess that between 100 and 200 workers will be employed at the mine when it reaches full production. The facility employed 350 people prior to being closed.

When informed of Etruscan's plans by Northern Ontario Business, Pickle Lake Reeve Jim Dalzell said the news was "fantastic."

Dalzell said the mine's reopening will most likely result in a boost in the community's population.

"Unemployment in the town is practically nil. They (Etruscan) will have to bring miners in," the reeve said, noting that a number of job openings in the town have not been filled during recent months. "It was a big boost when (Placer) Dome hired 100 people for their mine. This will make a real difference to the town."

Any influx of new residents could also provide a boost for the community's retail sector. Dalzell said the population growth could merit another store being established in the community of 500.

However, he cautioned that "unless there are guarantees that the mine will be operated for a number of years, no new business is going to want to establish here."

COPYRIGHT 1991 Laurentian Business Publishing, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:Etruscan Enterprises Ltd.
Author:Krejlgaard, Chris
Publication:Northern Ontario Business
Article Type:company profile
Date:Jan 1, 1991
Previous Article:Manufacturer's sales are increasing despite a slump in lumber industry.
Next Article:Erocon stands to benefit from growing concern over tailings.

Related Articles
Giant Yellowknife 'doing well' in battle to reduce costs.
Gold exploration in Wawa steady, but less intense.
Slump in exploration activity in Sioux Lookout.
Diabase quarry reopens after 74-year dormancy.
Strength in numbers.
PGM exploration still tops list of activity: While gold exploration is on the rise in the northwest, high-technology metal exploration remains at the...
Mining revival spells prosperity for region: area witnesses resurgence in development and exploration. (Special Report: Timiskaming).
Northern Ontario Airports.
State takes over New Orleans.

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters