North of 60 Mining & Exploration Review 2017

& North Mining Exploration

60

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Review

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Unlocking Potential Northwest Territories celebrates 25 years of diamond exploration and mining

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Table of Contents 6 Mining in Alaska – The state

continues to rank as one of the top regions in the world for mineral potential

12 What the Future Holds – Exploration and mining in Nunavut in 2016 and beyond

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artners in Industry – Increasing P Aboriginal business engagement in Canadian mining

58 Haven’t Reached a Peak – SUMIT initiative still delivering results

60 Strength in Numbers – Building gender diversity in mining

2 0 The Ups and Downs – Reviewing Yukon’s mineral exploration highlights

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28 Unlocking Our Potential – Northwest

65 A Road Well Travelled – The Sahtu

Territories celebrates 25 years of diamond exploration and mining

34 Opening the Door to Nunavut’s Hidden Treasures

38 The Good and the Bad –

New diamond mine highlights the year – exploration still wanting

42 44 50

ower Up – Northwest Territories P lithium and cobalt set to power the next generations of cars region gains all-weather highway

68 Looking to the Future – Innovation and technologies for a new era of mining

70 All the Carats – Applied Diamond Services for improved grade prediction and recovery

right Future – The Gahcho Kué Mine B will be a boost for both the NWT and Canadian economies

72 Mining Cargo – An accurate loading

acteria at Work – Designing custom B water treatment solutions for Canadian mines

74 At the Top – TerraX Minerals’

hange is in the Air – Canadian C mining industry readies and adapts in response to climate change

52 Inside the Hive – Crowdsourced prospecting is the bee’s knees

and stowage plan maximizes sealift cost efficiency

Yellowknife City Gold Project is poised to become one of Canada’s largest gold camps

76 A Major Step Forward – Copper

North’s Carmacks Copper-Gold-Silver Project is positioned to be Canada’s next new copper mine

North

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is published by DEL Communications Inc. Suite 300, 6 Roslyn Road Winnipeg, Manitoba, Canada R3L 0G5 www.delcommunications.com President & CEO David Langstaff Publisher Jason Stefanik Managing Editor Carly Peters carlypeters@mts.net Advertising Manager Dayna Oulion Toll Free: 1.866.424.6398

Advertising Account Executives Robert Bartmanovich | Cheryl Ezinicki Ross James | Dan Roberts | Gary Seamans Production services provided by: S.G. Bennett Marketing Services www.sgbennett.com Art Director Kathy Cable Layout Dana Jensen Advertising Art Sheri Kidd Cover Image Courtesy of Diavik Diamond Mines (2012) Inc.

Index to Advertisers Alkan Air Ltd................................................................................................26 Arctic Controls Inc...................................................................................49 Arctic Co-operatives Limited..............................................................7 Arkbro Industries.....................................................................................18 Aurora College..........................................................................................67 Aurora Geosciences Ltd.......................................................................78 Bureau Veritas Commodities Canada Ltd.................................33 Calm Air International LP....................................................................68 CanDig Mini Excavators Inc...............................................................55 Capital Helicopters (1995) Inc..........................................................37 CasCom Ltd.................................................................................................49 C.F. Mineral Research Ltd....................................................................57 Copper North Mining Corp...............................................................77 De Beers Group of Companies........................................................40 Desgagnes Transarctik Inc..................................................................23 DMC Mining Services............................................................................47 Driving Force..............................................................................................17 Duncan's Limited.....................................................................................27 Fednav.......................................................................................................IFC Fireweed Helicopters Ltd....................................................................19 Government of the Northwest Territories................................31 Great Slave Helicopters........................................................................33 GTC North America Inc........................................................................19

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Inland Group..............................................................................................74 J.S. Redpath Mining...................................................................................3 KBL Environmental Ltd.........................................................................69 Kitnuna...........................................................................................................25 Lynden Incorporated...............................................................................5 Matrix Camps, Logistics & Aviation Management.................9 Midnight Sun Energy Ltd............................................................... OBC Mountain Province.................................................................................41 NAPEG............................................................................................................27 NEAS Group..............................................................................................IBC Northern Industrial Sales....................................................................61 NU-Line Powerline Contractors Ltd.............................................47 Nuna Group of Companies...............................................................35 PDAC...............................................................................................................13 Peregrine Diamonds Ltd.....................................................................33 Ron's Auto Service, Ltd.........................................................................39 Saskatchewan Research Council...................................................11 Sirius Wilderness Medicine................................................................15 Summit Helicopters...............................................................................46 TerraX Minerals Inc..................................................................................75 Tundra Airborne Surveys Ltd............................................................27 YK Fire Prevention...................................................................................47

© Copyright 2017, DEL Communications Inc. All rights reserved.The contents of this pub­lica­tion may not be reproduced by any means, in whole or in part, without prior written consent of the publisher.

While every effort has been made to ensure the accuracy of the information contained in and the reliability of the source, the publisher­in no way guarantees nor warrants the information and is not responsible for errors, omissions or statements made by advertisers. Opinions and recommendations made by contributors or advertisers are not necessarily those of the publisher, its directors, officers or employees.

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Mining in

Alaska

The state continues to rank as one of the top regions in the world for mineral potential Submitted by the Department of Commerce, Community and Economic Development, Alaska Enshrined in the Alaska State Constitution, it is the policy of the State to encourage the settlement of its land and the development of its natural resources by making them available for maximum use consistent with the public interest. Mining has long played a prominent role in Alaska’s strong natural resource economy, providing employment, revenues to State and local governments, and facilitating infrastructure and community development.

Alaska is considered among the top two regions of the world for mineral potential, holding significant coal, zinc, copper, lead, gold and silver reserves, as well as rare earth elements. According to the Fraser Institute's Annual Survey of Mining Companies in 2015, Alaska ranked in the top six regions worldwide for investment attractiveness – a measure of both mineral potential and the effect of State and Federal policies on investment. More than 190 million acres of Federal, State and Native-owned lands are open for mineral-related activities and mining in Alaska.

Alaska has five large hardrock mines, one large coal mine and several hundred small placer mines. Alaska’s major mineral deposits currently in production include the Red Dog Mine in the northwest Arctic; Greens Creek and Kensington Mines in southeast; and Pogo Mine and Fort Knox Mine, both in the interior. Usibelli Coal Mine, the state’s only active coal mine, provides coal for interior Alaska and Pacific Rim markets.

• The estimated first market value of production in 2015 was $2.76 billion (Figure 1).

• Mineral exploration expenditures $58.3 million, a reduction from the prior year (Figure 1). Much of this decline resulted from the lack of activity of large exploration projects.

Trends1 • While total reported value2 of Alaska’s mineral industry decreased by 15 per cent in 2015 to $3.13 billion, gross income reported by mining operators indicated the continued strength of the industry in Alaska, increasing nearly three per cent in 2015 to $2.50 billion.

• Development expenditures rose 10 per cent in 2015 to $309.9 million (Figure 1).

• As in 2014, zinc was the top metal produced in 2015, with a production value of almost 45 per cent of total Alaska metal production. Gold followed at 37.5 per cent, along with lead at 9.1 per cent and silver at 8.8 per cent.

• Mineral industry employment in 2015 was estimated at 2,901 full-time equivalent jobs, a reduction of just two per cent from 2014.

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Figure 1: Reported annual exploration and development expenditures of the mineral industry, the estimated first market value of mineral production in Alaska, and gross income from Alaska mining operations (in millions of dollars), 1981-2015. (Data source: Alaska’s Mineral Industry 2015 Special Report 71)

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Development rises even as value dips Despite a drop in the estimated first market value of production in 2015, reported and estimated development expenditures were 10 per cent greater than in 2014, with seven projects reporting spending a total of approximately $309.9 million. Projects that reported significant development expenditures are Red Dog, Fort Knox, Pogo, Kensington and Greens Creek mines, which together spent more than $285.6 million, with Fort Knox Mine having the largest ongoing development project in Alaska.

The value of gold production has decreased 35 per cent to $1.01 billion in 2015 since 2013’s record value of $1.55 billion (Figure 3, next page). Gold production from lode mines in the eastern interior and southeast regions totalled 873,984 ounces in 2015, of which 78 per cent was produced from the Fort Knox and Pogo gold mines.

Kensington Gold and Greens Creek polymetallic mines in southeast Alaska, the third and fourth largest gold producers respectively, accounted for the remainder of reported gold production.

Coal production and exports Zinc holds primacy Zinc maintained its place as the leading mineral product of the state with a value of $1.2 billion in 2015, and accounting for 44 per cent of Alaska’s production value (Figure 2). The annual value of zinc production has exceeded that of gold since 2014.

Coal production declined by approximately 323,000 tonnes or 22 per cent in 2015 (Figure 4, next page), primarily due to a reduction in coal exports. In the past decade, the value of coal exports has decreased 85 per cent from the high of $33 million in 2009 to $5 million in 2015. Usibelli Coal Mine exported 150,000 tonnes of coal to Japan, but no shipments were made to other regular customers in Chile or South Korea. This low export demand and a drop in price for Alaska coal can be attributed to an oversupply in the global market combined with a strong U.S. dollar.

Driven by the location of the resource, coal is used for power generation largely in the interior region, and produced 9.2 per cent of Alaska’s overall electric power in 2014 according to the EIA. When the interior region’s Golden Valley Electric Association’s Healy Number 2 coal-fired power plant becomes fully operational, expected sometime in 2017, local demand will be boosted. When

Figure 2: Estimated 2015 mineral production in Alaska by commodity. (Source: Alaska’s Mineral Industry 2015 Special Report 71)

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fully operational, the 50-megawatt plant at the mouth of the Usibelli mine would use about 200,000 tonnes of coal per year.

Exploration and project update

Figure 3: Historical gold production in Alaska, 1880-2015, and corresponding market value. (Source: Alaska’s Mineral Industry 2015 Special Report 71)

Figure 4: Alaska coal production and exports, 1915-2015. (Source: Alaska’s Mineral Industry 2015 Special Report 71)

• The Donlin Gold partnership is moving forward on permitting of the Donlin Gold Mine, approximately 277 miles west of Anchorage. The draft Environmental Impact Statement prepared by the U.S. Army Corps of Engineers was released for public review and comment in November 2015. A final EIS is expected by March 2017, and Record of Decision by August 2017. http://www. donlingold.com/ •M ystery Creek Resources, Inc.’s Nixon Fork Mine in westcentral Alaska, which recovers copper concentrate and carbon-in-leach to recover gold, is moving toward a restart, after going into temporary closure status in June 2013. In August 2016, Mystery Creek Resources submitted notification to restart the project.

•C oeur Mining, Inc.’s Kensington Mine north of Juneau continued with exploration of the Jualin deposit in 2015, spending $4 million. Underground exploration to reach the deposit is in progress. http://www.coeur. com/mines-projects/mines/kensington-alaska • S umitomo Metal Mining’s Pogo Mine again accounted for the largest share of exploration in Alaska’s active eastern interior region in 2015, spending $15 million exploring multiple targets. This effort increased Pogo’s global gold reserve by the equivalent of several years of production. http://pogominealaska.com/ •G raphite One Resources, Inc. released an updated resource for its Graphite Creek property on the Seward Peninsula, upgrading a portion of the inferred resource to indicated status. The deposit is a world-class large-flake graphite deposit due to the deposit’s overall size, high graphite grade, percentage of large-flake graphite, and readily available infrastructure including a deep sea port at Nome. According to the USGS, worldwide demand for graphite has increased steadily since 2012. No production of natural graphite was reported in the U.S. in 2015, with most domestic demand being met by China. http://www.graphiteoneresources.com/

Footnote These trends and much of what is contained in this article is a summary of the 2015 Alaska Mineral Industry, Special Report 71: J.E., Werdon, M.B., Twelker, Evan, and Henning, M.W., 2016, Alaska's Mineral Industry 2015: Alaska Division of Geological & Geophysical Surveys Special Report 71, 45 p. http://doi. org/10.14509/29687 2 Total reported value is a composite of the year’s expenditures on exploration and development plus the estimated first market value of the commodities produced. n 1

10 Mining North of 60 | 2017

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What the Future Holds

Exploration and mining in Nunavut in 2016 and beyond Submitted by the Government of Nunavut’s Minerals and Petroleum Resources Division

Baffinland workers prepare a shipment of iron ore.

Nunavut represents one-fifth of Canada’s land mass and remains relatively under explored. Composed of diverse geological bedrock provinces hosting a number of rich deposits, it is an attractive frontier for grassroots exploration. Nunavut has a single settled land claim, the Nunavut Agreement, and an established land tenure and regulatory system. The Crown administers mineral rights to 98 per cent of Nunavut, Inuit organizations hold sub-surface (mineral) rights to the remaining two per cent, and also retain surface rights to approximately 18 per cent of Nunavut. Since the creation of the territory these arrangements have allowed for a co-management governance structure, and although the regulatory processes are well-defined, efforts continue to improve the co-management regime and project review stages.

According to Natural Resources Canada

12 Mining North of 60 | 2017

in 2015 companies invested an estimated $215 million for exploration and deposit appraisal work in their search for commodities in Nunavut – mainly gold, diamonds, uranium, base metals, and iron. As senior exploration companies conduct the majority of resource development projects, a shift towards investing in existing facilities and more advanced projects reveals an additional $534 million in expenditures towards mine complex and development projects. This represents a total resource sector investment of $749 million in Nunavut for 2015. Preliminary estimates for the value of mineral production in 2015 amount to $567 million, which is derived primarily from gold mining at Meadowbank.

For 2016, the investment and production levels for resource projects is anticipated to be somewhat lower as Nunavut

experiences the same declining worldwide trend in financing for exploration, especially among the junior companies.

A few senior exploration companies, however, have persevered in Nunavut with significant exploration campaigns again this year.

Infrastructure Operating in remote regions of the country adds significantly to project costs and therefore investments that enhance infrastructure is one solution towards reducing logistical barriers. These efforts are part of the transportation strategy of the Government of Nunavut, and are beginning to show results. In the eastern Arctic, a new $300 million airport for Iqaluit scheduled to open in 2017 will support the arrival and receiving of a growing volume of air

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Hope Bay. freight. Geotechnical drilling has already begun in Iqaluit on an $85 million marine port and sea lift facility that is garnering support from all levels of government and could be in operation by 2020.

In the west, a cooperation agreement for a project proposal, the Grays Bay Road and Port, was signed this year between the Government of Nunavut and the Kitikmeot Inuit Association (www.gbrp.ca).

The project consists of a deep-water port at Grays Bay and phased construction of a 325-kilometre all-season road reaching the former Jericho diamond mine and the Nunavut-NWT border. The fully completed road may eventually link to the existing Tibbit-Contwoyto winter road, connecting the Kitikmeot region of Nunavut to the south and the national highway network.

Grays Bay Road and Port would render economic the transport of large amounts of construction materials, equipment, and supplies to future mine sites and allow the bulk export of mineral concentrates to world markets.

Base metals Base metal projects among others would benefit from road access to promising mineral prospects. In proximity to the proposed Grays Bay Road, MMG Resources Inc. is examining its large base metal deposits at Izok Lake and High Lake acquired in 2009. Indicated resources at Izok are 15 million tonnes of ore grading 13 per cent

14 Mining North of 60 | 2017

zinc and 2.3 per cent copper. High Lake is of a similar size with 14 million tonnes in three mineralized zones with an average grade of 3.8 per cent zinc and 2.5 per cent copper.

Farther to the east, the Hackett River project, owned by Glencore Canada Corporation, hosts one of the largest undeveloped volcanogenic massive sulfide deposits in the world. The company reports the silver-rich base metal deposits in the area to contain 27 million tonnes of measured and indicated resources grading 4.5 per cent zinc, 130 g/t silver, 0.6 per cent lead, 0.5 per cent copper and 0.3 g/t gold, with an additional 60 million tonnes as inferred resources grading 3.5 per cent zinc, 150 g/t silver, 0.5 per cent lead, 0.4 per cent copper and 0.2 g/t gold.

These significant deposits highlight the key importance of all-season road construction projects since bulk transportation of mineral concentrates is required for further refining elsewhere.

Diamonds The most advanced diamond exploration play in Nunavut is the Chidliak project on southern Baffin Island. Peregrine Diamonds Ltd. has unearthed a total of 74 kimberlites. Currently, eight of the diamond-bearing kimberlites are thought to have economic potential. Following two bulk sampling campaigns on the most promising kimberlites, CH-6 in 2013 and CH-7 in 2015, the company released a

preliminary economic assessment in July 2016 based on inferred mineral resources.

The report outlines a first phase of mine site development that would require initial capital expenditures of $435 million, including the construction of a 155 kilometre all-season access road from Iqaluit.

The plan consists of an open pit operation that would produce an estimated 11.6 million carats over a 10-year mine life by processing 0.7 million tonnes of ore per year with an average grade of 1.67 carats per tonne. At current prices, the overall base valuation for the CH-6 and CH-7 diamonds is about US$140 per carat, contributing to a favourable outlook for the project. Peregrine recently announced plans for a $15 million program at Chidliak to advance prefeasibility studies and conduct further bulk sampling activities at Childliak which could amount to $17 million in exploration expenditures for 2017.

In addition to the Chidliak project, exploration for diamonds in Nunavut is experiencing a revival. Only eight kilometres north of the community of Naujaat (formerly Repulse Bay) lies the Qilalugaq diamond project. Previous sampling and delineation drilling by Stornoway Diamonds Corp. outlined an inferred mineral resource of 26.1 million carats from 48.8 million tonnes of kimberlite down to a depth of 205 metres at an average grade of 0.54 carats per tonne. At 12.5 hectares in size, the Q1-4 complex is one of the larg-

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Meadowbank. est diamond-bearing kimberlite intrusions discovered in the territory.

Gold Gold projects continue to dominate exploration and mine development in the territory. The Hope Bay project, owned by TMAC Resources Inc., is approaching gold production southwest of Cambridge Bay. The Hope Bay deposits contain 3.2 million ounces of recoverable gold and resource expansion drilling this year continued to discover high-grade gold intersections on the known Doris Mine mineral reserves.

The company received delivery of equipment and machinery for its ore processing plant in August 2016, and construction at the mine complex and commissioning of the facilities was underway in the months that followed. TMAC Resources anticipates entering commercial gold production from its underground Doris North deposit in early 2017, and ramping up production throughout the year. The company continues to explore deposits close to the Doris deposit.

Agnico Eagle Mines Ltd. owns the Meliadine advanced gold project near Rankin Inlet. The company received project approval for its water licence in 2016, and presently considers advancing work to be on track for a possible mine start in 2020.

The Meliadine deposits consist of 3.4 million ounces to be mined from an open pit and underground operation. Within the

16 Mining North of 60 | 2017

current mine plan, it is the highest grade gold project for Agnico Eagle in Nunavut with an average grade of 7.32 g/t gold from 14.5 million tonnes of ore.

At the Meadowbank gold mine, Agnico Eagle received approval to expand mining at the Vault Pit, enabling continued production until 2018. Over 2.3 million ounces of gold have been recovered from Meadowbank since 2010. Close to 35 per cent of the workforce comes from Baker Lake and neighbouring communities in the Kivalliq.

Agnico Eagle was permitted and began construction in 2016 of a 62-kilometre all-season road from the mine complex at Meadowbank to the Amaruq gold project. Agnico Eagle has currently defined an inferred resource of 3.7 million ounces of gold from 19.4 million tonnes of ore with an average grade of 5.97 g/t after only three years of extensive exploration drilling on the property. As part of $33 million the company budgeted for exploration at Amaruq, over 125,000 metres of diamond drilling were completed.

Sabina Gold and Silver Corp. released a feasibility study on the Back River gold project which consists of two main properties, George and Goose. The project would require an initial capital investment of $415 million for a gold mining operation that would produce an average of 194,000 ounces per year with a 12-year mine life.

Following submission of the environmental impact statement for the project, the

company did not receive a recommendation for approval for the project from the Nunavut Impact Review Board in June 2016. The board indicated in its ruling that the project proposal could be resubmitted with more information on environmental monitoring and mitigation measures, particularly where caribou and effects of climate change are concerned. A decision on the recommendation currently rests with the Minister of Indigenous and Northern Affairs Canada for response.

Iron The largest project in eastern Nunavut is the Baffinland Iron Mines Corp. Mary River iron mine. This high-grade iron ore development project consists of five significant deposits and four additional prospects.

Deposit No. 1 is where the mine commenced operations in September 2014.

It contains proven reserves of 160 million tonnes at 64.4 per cent iron and probable reserves of 205 million tonnes reaching 64.9 per cent iron. Baffinland revised its development plan into an early revenue phase that proposed shipments totalling 4.2 million tonnes per year during the open water season. In August 2015, the first ship load of iron ore left the company’s Milne Inlet port destined for Europe. Production of 2.75 million tonnes is expected for 2016 as operations ramped up and are anticipated to grow next year. The company intends to submit an environmental

Agnico Eagle employee collects a water sample.

Nakoolak takes a break at Meliadine. impact statement for its proposed Phase 2 of operations for review which would see 12 million tonnes of ore produced and shipping throughout 10 months of the year. To accommodate this increase, Baffinland would require moving ore along a separate railway line to the port in place of continued use of the existing tote road from Mary River.

Uranium Uranium exploration in the territory has been limited due to continuing soft prices for uranium and a negative 2015 decision from the Nunavut Impact Review Board and acceptance of their findings by the Minister of Indigenous and Northern Affairs Canada on AREVA Resources Canada Inc.’s final environmental impact statement for the development of the Kiggavik uranium project. Development of the Kiggavik deposits 80 kilometres west of Baker Lake

Drilling Loading Blasting Ventilation Scaling

was proposed as three open pits, and the Sissons deposit southwest of Kiggavik as an open pit and underground operation.

The decision not to issue a project certificate was due to in part to start date uncertainty for construction and development of the mine, and insufficient information on the environmental and socio-economic impact of the project. Since the decision, AREVA has suspended the project and has placed the exploration camp under care and maintenance until further notice.

Looking forward With Mary River in the Qikiqtaaluk and Meadowbank in the Kivalliq in operation, Nunavut is poised to welcome the Hope Bay gold mine in the Kitikmeot early in the new year. This brings three mines in the territory to production, one in each region. A number of other mineral resource projects, especially focused on gold, under

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various stages of exploration and development underscore the need to work cooperatively with the regulatory agencies to ensure these opportunities also receive the necessary attention through the permitting process.

Throughout the discovery to development process, the Government of Nunavut is working to ensure that Nunavummiut are in a position to become beneficiaries of emerging resource development opportunities. Nunavut has tremendous resource potential as revealed by the remarkable successes achieved by exploration companies during recent difficult years. With continued investment, effort and cooperation by all, Nunavut can look forward to many more discoveries in future. n

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The Ups and Downs

Reviewing Yukon’s mineral exploration highlights Submitted by the Yukon Geological Survey, Department of Energy, Mines and Resources, Government of Yukon Challenging equity market conditions continued to affect the mineral exploration industry’s ability to raise money for programs in Yukon. Spending levels in 2016 were similar to 2015, with exploration expenditures estimated at $60 million and development expenditures at $20 million.

Yukon’s sole operating hard rock mine, Capstone Mining Corp’s Minto copper-gold silver mine closed its open-pit mining operation in September 2016, as forecasted in an announcement five months previously, due to low copper prices. The company continues to mine underground high-grade ore. Production for the first three quarters of 2016 totalled 22,625 tonnes of copper at a cash cost of $1.30 per pound, with by-products of zinc, molybdenum, lead, silver, and gold. Underground mining is planned to extend into July 2017, but a temporarily closure is expected in 2017 once underground mining is complete and all the stockpiles are processed.

The most substantial exploration program in Yukon was undertaken by BMC Minerals (http://bmcminerals.com) on its recently acquired Kudz Ze Kayah volcanogenic massive sulphide property in the Finlayson Lake District of southeast Yukon. After two exploration seasons, BMC Minerals announced an updated resource (January 2016) on the ABM deposit and the discovery of the Krakatoa deposit on the property. The combined resource of the ABM and Krakatoa deposits totals 20.8 Mt of 6.4 per cent Zn, 2.0 per cent Pb, 0.9 per cent Cu, 145 g/t Ag and 1.4 g/t Au. BMC completed metallurgical test work and budgeted for 15,000 metres of exploration and definition diamond drilling, which will allow the company to complete a prefeasibility study late in 2016.

The industry was buoyed by positive news in mid-May with the announcement of Goldcorp’s (www.goldcorp.com) intention to acquire Kaminak Gold (http://kaminak.com) and its 100-per-centowned Coffee gold property in west Yukon. Kaminak shareholders approved the CAD$520 million deal in July 2016. Exploration at the Coffee project was focused on the evaluation of early stage targets. Reverse circulation and diamond drilling were undertaken on seven gold-in-soil anomaly targets: Arabica, Supremo T8, T3 North, Espresso, Americano, Kazaar and Kona. Diamond drilling was also undertaken at the Latte deposit for metallurgical testwork of deeper sulphide mineralization. Goldcorp plans to focus on review and optimization of the Kaminak feasibility study, First Nations consultations, and studies to support the permitting process.

Victoria Gold (www.vitgoldcorp.com) continued to explore its Dublin Gulch gold property with 20,000 metres of drilling on the higher grade Olive and Shamrock zones (Figure 1), two kilometres from the Eagle Gold deposit. Victoria Gold demonstrated the viability of its licenced Eagle mine through the release of a new feasibility in September 2016. The study determined all-in sustaining costs for the 33,700 tpd open-pit operation at US$638 per ounce.

The project has a post tax NPV of US$508 million and an IRR of 29.5 per cent. Annual gold production is estimated to be 190,000 ounces per year over 10 years.

Alexco Resources (www.alexcoresource.com) continued exploration work on its Keno Hill property with 15,500 metres of diamond drilling on the high grade core (Bear Zone) of the Bermingham deposit. A significant intersection assayed 2715 g/t

Figure 1 – Exploration roads on the Shamrock Zone of Victoria Gold Corp.’s Dublin Gulch gold property.

20 Mining North of 60 | 2017

Yukon Exploration and Mining Projects 2016 MAP FEATURES

P

community

^ !

B ! (

capital city

B

permitting stage

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deep water port

mine

highway mineral claims parks & withdrawn areas

Eagle (Dublin McConnell's Gulch ) Jest

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Dawson Goodman Nadaleen Swede City !

P !

Trend !

Tiger Creek !

Red !

Bermingham !

Lone Star Mountain Leota Grabben Gold Mars , B! % Kate Aurex Eureka Dome Project Flame & Moth Eureka Mayo Coffee P !

Rainbow Mayo Project Dubloon Old Rosebute !

Lake Cabin Moosehorn P !

Lucky Strike Bellekeno Mine Ste war t Plateau QV !

(Ag, Pb, Zn) Crossing South Ballarat Crooked (suspended !

White Project operation) !

Regional !

Boulevard VIP Minto Mine " )B Ti (Cu, Au, Ag) Golden nt in OOO Horseshoe a B Canadian Fa !

Rude ul Freegold Mtn Creek t Creek Carmacks Gold )" " Casino ) " ) Copper (permitting) Caribou Creek !

WS Ca rmacks Ross P !

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Hill

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lead/zinc jade

vein/breccia volcanic associated

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mafic/ultramafic associated

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projects with <$500 000 in expenditures are small symbols

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sediment associated

projects with >$500 000 in expenditures are large symbols

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porphyry/sheeted vein

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Rancheria

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British Columbia Skagway Î

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The exploration activity data represented on this map were compiled by the Minerals Unit of the Yukon Geological Survey. This map was created based on the best available information at the time of publication.

Ha ines Î

YUKON GEOLOGICAL S URVEY

Figure 2 – Newly constructed bridge over the Little Hyland River enabling road access to Golden Predator Mining Corp’s 3 Aces property.

Photo courtesy of Golden Predator Mining Corp.

Ag over 7.5 metres in diamond drillhole K-16-0608, which was drilled 100 metres down-plunge from the deepest drill intercept from 2015. Given the recent bullish trend in silver price, Alexco is also preparing for a return to production by collaring a portal into the recently discovered Flame & Moth deposit adjacent to the mill. The company has also initiated a mill assessment and maintenance program, and is undertaking hydrological drilling, geotechnical investigation, metallurgy, and waste rock characterization studies in support of permitting. A new resource estimate for the Bear Zone is being calculated and will be included in an updated Preliminary Economic Assessment, expected before the end of 2016.

Atac Resources (www.atacresources.com) explored its extensive Rackla Gold project (the western Rau Trend and eastern Nadaleen­trend). The company filed a favourable preliminary economic assessment for the Tiger deposit in the Rau Trend. Work in the Tiger East area included prospecting, geological mapping and float sampling at a gold-in-soil geochemical anomaly 125 metres away from the proposed Tiger Deposit pit. Twenty-one oxide float composite grab samples were collected and assay values ranged from below detection up to 18.30 g/t gold. On the Nadaleen trend, the company completed phase 1 rotary air blast drilling and phase 2 diamond drilling on the Orion zone. Diamond drillhole AN-16-010 successfully twinned the Orion rotary air blast discovery hole and returned 61.29 metres of 2.75 g/t Au. Golden Predator Mining Corp (www.goldenpredator.com) conducted a significant program on its 3 Aces property in southeast Yukon (Figure 2). The company constructed a bridge over the Little Hyland River and completed an access road to the property.

22 Mining North of 60 | 2017

Eleven new mineralized veins were discovered on the property in 2016, largely from trenching gold-in-soil anomalies. Golden Predator undertook panel sampling of trenches in several zones and completed 31 reverse circulation drillholes (510 metres) to test high-grade mineralization in trenches down-dip and along strike of a bulk sample from the main Sleeping Giant vein. Highlights from the RC drilling include 11.43 metres of 31.89 g/t gold from a depth of 12.80 metres; including 6.10 metres of 50.50 g/t gold from hole 3A16-RC015. PQ core drilling is planned for late in 2016 (400 metres).

Diamond drilling (8,427 metres, 44 holes) at Rockhaven Resources’ (www.rockhavenresources.com) Klaza property in southwest Yukon focused on defining and expanding resources, as well as testing geophysical and geochemical anomalies across the property. A new gold-rich vein zone was discovered through drilling the Rex zone. The Rex zone contains three near-surface veins (DDH KL-16-314 – 1.39 metres of 5.90 g/t Au, 1.42 metres of 10.55 g/t Au and 1.48 metres of 7.74 g/t Au) and was discovered while testing a strong chargeability anomaly at depth. Rockhaven released a positive Preliminary Economic Assessment for the property in March 2016.

Goldstrike Resources (www.goldstrikeresources.com) explored its flagship Plateau Gold property through diamond drilling (1,500 metres in 11 holes) on the Goldstack zone, one of several targets along the 50-kilometre-long Yellow Giant trend. DDH PSGS-1601 returned 6.05 g/t Au over 45.5 metres, including 21.13 g/t Au over 12.25 metres. All holes intersected mineralized stockwork and breccia and the zone remains open. Drilling indicates that the main control on mineralization is the Eldorado fault, a northeast-

Figure 3 – Geologists examining the Nugget vein on Klondike Gold Corp’s Klondike Goldfields property. trending structure. A regional prospecting program on the property led to doubling the known strike length of the Yellow Giant to 50 kilometres and staking additional ground on the trend.

Klondike Gold (www.klondikegoldcorp.com) had a productive season exploring its Klondike Goldfields property, doubling its land position by acquiring 1,125 claims, diamond drilling (71 drillholes, 5,636 metres) and conducting a 230-line-kilometre ground magnetic survey. Diamond drilling tested three separate targets (Lone Star, Christie and Nugget zones) on the property for gold mineralization at shallow depths (Figure 3). Results are pending.

There was renewed activity at the past-producing Brewery Creek property owned by Golden Predator Mining Corp. (www. goldenpredator.com). The company completed over 1,300 metres of geotechnical and metallurgical drilling near former pits to evaluate the remaining gold mineralization of those deposits. Twelve PQ-sized (85-millimetre diameter) metallurgical core holes totalling 639 metres were drilled on the previously mined Lucky, Kokanee, and Golden deposits. The drilling provided oxide material for heap leach testing, as well as high-grade sulphide material to test for gold recovery by carbon-in-leach and flotation methods.

Geotechnical and groundwater monitoring drilling (11 HQ holes, 694 metres) were completed, with Geotech hole No. 11, drilled on the high wall of the conceptual Lucky pit, intersecting 21.2 g/t gold over 8.2 metres.

24 Mining North of 60 | 2017

Independence Gold (www.ingold.ca) completed a reverse circulation drilling program on its Boulevard property, which is contiguous with Goldcorp’s Coffee property in the White Gold District. A total of 1,401 metres of reverse circulation drilling was completed in 15 drill holes within the Sunrise-Sunset area. On the Sunset trend, multi-element soil anomalies within the 2.3-kilometre-long trend were the focus of drilling. Drill hole BV16-54 returned 7.73 g/t Au over 6.1 metres within a broader intersection that assayed 1.58 g/t Au over 39.6 metres and ended in mineralization. The company also performed RC drilling on the Denali zone (1545 metres, 15 drillholes), which lies on an interpreted extension of the Coffee Creek fault system, a major structure that transects Goldcorp’s Coffee property. At Denali, YCS16-08 was drilled approximately 50 metres downdip to the northeast from the 2015 discovery hole on the zone and returned 4.28 g/t Au over 4.6 metres.

Independence also conducted a rotary air blast drilling program (12 holes, 923.5 metres) on its Rosebute property in western Yukon. Drilling on the Hudbay zone, a 1.3 kilometre-long goldsilver-tungsten-molybdenum soil geochemical anomaly, intersected multiple zones of gold mineralization, e.g., RO16-15 - 0.50 g/t Au over 36.6 metres, 0.31 g/t Au over 38.1 metres and 0.15 g/t Au over 91.4 metres, starting at 12 metre depth.

Comstock Metals Ltd. (www.comstock-metals.com) revisited the QV property in west Yukon, completing an IP/resistivity

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survey, GT probe sampling and soil sampling in phase 1. Partial funding was provided by the Yukon governmentâ&#x20AC;&#x2122;s Yukon Mineral Exploration Program (YMEP). The phase 2 program included 1,788 metres (24 holes) of rotary air blast drilling to rapidly screen potential targets. Highlights of the drilling include 3.05 metres of 7.79 g/t Au near-surface in hole 16QVRAB00. Hole 16QVRAB012 returned 18.29 metres of 1.81 g/t Au starting at surface, representing an interpreted extension of the VG deposit 55 metres to the east. Comstock has also increased the size of its QV project by staking an additional 31 quartz claims.

Banyan Gold (www.banyangold.com) completed 475 metres of diamond drilling in three holes (including one for metallurgical testing) near the Main Zone of its Hyland Gold Project in southeast Yukon, as well as soil sampling and trenching over arsenicgold soil anomalies. Results are pending.

Strategic Metals (www.strategicmetalsltd.com) continued generative work on its extensive portfolio of Yukon properties, with drilling on the Hartless Joe (gold), Hopper (copper porphyry), Mars (gold) and Salloon (copper) properties (3,028 metres, 17 holes). Results are pending.

Copper North Mining Corp (www.coppernorthmining.com) released a preliminary economic assessment (PEA) on its Carmacks copper-gold-silver property in central Yukon. The PEA evaluated the recovery of gold and silver, along with copper using tank leach technology as opposed to heap leaching. The process involves agitated tank leach processing of the copper oxide mineralization to produce cathode copper, followed by agitated tank leach cyanidation and carbon-in-leach for recovery of gold and silver dore bars.

Northern Freegold Resources Ltd. (www.northernfreegold. com) completed a modest work program on its Freegold Mountain property. The company conducted a magnetic and VLF-EM survey and completed a multielement geochemical soil survey at Tinta Hill, outside of the main deposit, to define trenching and diamond drill targets. Mapping and relogging select historic core at the Nucleus and Revenue deposits was undertaken to define a paragenetic sequence and better target porphyry mineralization.

The Lucky Strike property of Goldstrike Resources Ltd. (www. goldstrikeresources.com) in the White Gold District benefitted from YMEP funding, which enabled the company to undertake soil sampling and a trenching program (477 metres). Trenching on the 1,400 by 350 metre gold-in-soil anomaly at the Monte Carlo zone returned 0.42 g/t Au over 154 m, including 0.76 g/t Au over 78 metres. The anomalous zone is characterized by elevated values of silver, tellurium, molybdenum, and copper and is coincident with a strong northwest-trending geophysical anomaly. The Monte Carlo zone is one of four large gold-in-soil anomalies at Lucky Strike that lie on a nine kilometres northwest gold trend that remains open.

Grassroots exploration was active across the territory with 5,400 new quartz claims being staked in 2016 by the end of September, a four-fold increase from the previous year. Total claims in good standing in Yukon remains over 200,000. Of the 65 exploration projects, activity was overwhelmingly gold-focused with 75 per cent of exploration programs exploring for gold, with the remaining 25 per cent split among lead, zinc, copper, nickel, silver, platinum group metals, and jade. n

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Unlocking Our Potential

Northwest Territories celebrates 25 years of diamond exploration and mining

Submitted by the Department of Industry, Tourism and Investment, Government of the Northwest Territories

28 Mining North of 60 | 2017

This year marks a 25-year commemorative milestone for the diamond industry of the Northwest Territories (NWT). In 1991, on the shores of Lac de Gras, geologists Chuck Fipke and Stewart Blusson found evidence of the territory’s first diamond-bearing kimberlite pipe that resulted in the largest staking rush in Canadian history. Their discovery resulted in the construction and opening of Canada’s first diamond mine, Ekati, and ignited a $28-billion-dollar industry which established Canada as the world’s third largest diamond producer by value and fifth by volume.

Grand opening of Gahcho Kue diamond mine On September 20, 2016, De Beers Canada and Mountain Province Diamonds celebrated the grand opening of the Gahcho Kué Diamond Mine. Located 280 kilometres northwest of Yellowknife, Gahcho Kué is hailed as one of the world’s 10 largest diamonds mines. Gahcho Kué is anticipated to produce 54 million carats, contribute $6.5 billion to the Canadian economy, and provide 1,200 new jobs throughout the life of the mine.

NWT diamond production expansions The total estimated value of minerals and diamonds produced in the NWT in 2015 was $1.79 billion, of which diamonds account for 97 per cent of the value. Both Diavik, the territory’s second diamond mine, and Ekati are working on expansion projects. Diavik is currently developing a new diamond pipe, A-21, at Lac de Gras that enhances the mines economics until the 2023 planned closure.

Over at Ekati, the territory’s first diamond mine, the environmental assessment of the Ekati Jay Pipe received ministerial approval and Dominion Diamond Corporation approved the project to proceed to the permitting and licensing phase. The Jay Pipe Project will extend the life-of-mine estimates for Ekati by over 10 years. In September, Dominion Diamond Corporation announced the restart of the Ekati process plant following a fire. The plant repairs were completed substantially ahead of schedule and below the original cost estimate. Another highlight for Ekati was the September 2017

| Mining North of 60 29

sale of an impressive 186-carat gem quality Ekati diamond for US$2.8 million.

The diamond is the largest gem-quality diamond recovered at the Ekati mine to date. This follows on the discovery in August 2015 of a 187.7-carat stone at Diavik called the Diavik Foxfire.

The Snap Lake mine owned by DeBeers Canada is Canada’s first and only underground diamond mine. It was placed on care and maintenance in December and is currently up for sale.

Roads to Northwest Territories’ resources The Government of the Northwest Territories (GNWT) is examining three NWT transportation corridors to link communities and open up regions of proven mineral and petroleum potential: the Slave Geological Province (SGP) corridor, the Mackenzie Valley Highway from Wrigley to Norman Wells, and the Tłįchǫ All-Season road.

The long-proposed “Road to Resources” through the territory’s mineral-rich SGP would connect this area to southern Canada and eventually the Arctic coast of Nunavut. Portions of the SGP have been compared with the Abitibi region of northern Ontario and Quebec, which hosts some of the world’s richest mineral deposits. Potential exists for more than just diamonds, with gold and precious metal rich base metal showings in the greenstone belts along the proposed corridor.

To maximize access to the current diamond mines in the SGP and to assist future mineral resource development, proposed

30 Mining North of 60 | 2017

routes through the SGP were plotted using geoscience and mineral potential information. Known mineral tenures, geology, and mineral showings were combined to produce mineral potential rankings.

These rankings were then plotted against lakes and other surficial features for consideration by the GNWT Department of Transportation (DOT) and a route for the project providing the greatest economic benefit was chosen for advanced study based on this information.

The transportation corridor in the Mackenzie Valley has a long-standing goal to see more than 800 kilometres of all-season-road added to the NWT highway system. The GNWT is currently constructing the northernmost section of the Mackenzie Valley Highway, the Inuvik to Tuktoyaktuk Highway, which is scheduled to open in the fall of 2017. The GNWT then wants to advance a proposal for the southernmost 300 kilometres of the project for an all-season road from the current Mackenzie Highway terminus at Wrigley to the petroleum-rich Sahtu Region.

Finally, the Tłįchǫ All-Season Road would join the community of Whati to Highway 3, the road that links Yellowknife to southern regions. It would also allow mineral exploration and development activities in the western Slave Geological and Bear provinces and adjacent regions to proceed at lower costs than is currently possible.

Mining Incentive Program The mineral staking rush spurred by Fipke and Blusson’s kimberlite discovery

resulted in exploration and mining companies laying claim to over 26.7 million hectares of the territory for exploration.

The territorial government recognizes the essential role of the mining sector to the territorial economy and established the Mining Incentive Program (MIP) to stimulate and sustain mineral exploration activities throughout the NWT and reduce the risk associated with grassroots mineral exploration. In 2016, the program funded six corporate projects and five prospectors for a total of $400,000. Information on the MIP is available at www.iti.gov.nt.ca/en/services/ mining-incentive-program.

The MIP was established as part of the NWT Mineral Development Strategy, which was developed in 2013 to support a sustainable mining industry in the NWT, and committed to doing so in a responsible way while respecting aboriginal rights and the environment. The NWT’s resource potential is vast and the territory welcomes socially and environmentally responsible companies and investment that recognizes the economic opportunities available.

NWT mineral exploration activities The NWT is a vast, untapped, worldclass storehouse of mineral resources. It can boast significant deposit discoveries in diamonds, gold, tungsten, silver, bismuth, lead, zinc, cobalt, lithium, and rare earth elements.

There are over 2,813 mineral showings of approximately 75 known significant mineral deposits located across the NWT.

NWT RESIDENTS WANT

NEW MINES

Results from a territory-wide survey conducted by a national research company show that NWT residents favour more mining activity.

86% believe a strong mining sector is vital to the long-term health of the NWT economy 83% say regulation of the mining sector works well 82% would like to see more mining projects in the NWT

8 in 10 people have positive feeling about mining and mineral exploration companies operating in the NWT.

To learn more about the NWT's world-class resources visit: nwtmining.com • nwt petroleum.com • nwtgeoscience.ca THE SURVEY WAS CONDUCTED BY ABACUS DATA AND COMMISSIONED BY THE NWT AND NUNAVUT CHAMBER OF MINES AND THE MINING ASSOCIATION OF CANADA.

Although a few have seen historic mining on a small scale, the majority of these remains undeveloped. Current exploration is mainly focused on diamonds and gold and there is also considerable interest in lithium, tungsten, zinc, and lead.

Diamond explorer Kennady Diamonds has received encouraging bulk sampling results from its Kennady North Project, which is immediately adjacent to the new Gahcho Kue diamond mine.

Margaret Lake Diamonds and Canterra Minerals are exploring for diamonds in the same area. Exploration also continues both south and north of the Ekati and Diavik diamond mines.

Lithium is the target of 92 Resources Corp. near Yellowknife. Base metals were a major NWT export in the past and although Pine Point zinc/lead mine is closed, significant zinc/lead deposits remain in the area. Selwyn Chihong and Canadian Zinc Corp. both have advanced projects for these metals in the Mackenzie Mountains. Fortune Minerals Ltd. continues to advance its NICO goldcopper-bismuth-copper project.

NWT gold exploration continues with promising results. Nighthawk Gold Corp. has sampled several deposits, including the former Colomac Mine, and has defined a gold resource of over two million ounces. TerraX Minerals and Panarc Resources are sampling north and south of the former Con and Giant mines in Yellowknife, which together produced 12 million ounces of gold over almost 70 years. Tyhee Gold Corp. and Seabridge Gold Inc. also hold promising gold properties with millions of ounces of gold defined as mineral resources.

The NWT is also the host to the largest tungsten mine in the western world, Cantung, that is currently on care and maintenance, as well as one of the largest undeveloped tungsten deposits, Mactung, where a resource has been delineated totalling 33 million tonnes grading 0.88 per cent WO3. Both these projects are being managed by the Government of Canada and the GNWT, respectively, and new parties are being sought to move them forward. n

32 Mining North of 60 | 2017

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| Mining North of 60 33

Opening the Door to Nunavut’s Hidden Treasures

By Elizabeth (Liz) Kingston, general manager, Nunavut, NWT & Nunavut Chamber of Mines The mining industry is good for Nunavut and has been a significant contributor to Nunavut’s growth and prosperity, providing jobs and training opportunities, and supporting the economic sustainability of its 25 communities. Even in an economic downturn, Nunavut’s minerals industry remains a vital contributor to the territory’s well-being, accounting for approximately 18 per cent of the territorial economy.

The top three minerals produced in Nunavut are gold, silver, and iron ore. Exploration programs are focused on base metals, diamonds, uranium, and rare earth elements. According to Natural Resources Canada, the projected value of mineral production for 2015 in Nunavut is $567 M, representing 1.3 per cent of Canada’s total. Roughly $215 M in exploration and deposit appraisal expenditures are projected for 2015.

Mining holds great promise to open the door to Nunavut’s economic self-reliance.

Nunavut has two operating mines, with a third slated for production by early 2017.

Agnico Eagle Mines Ltd. (AEM) opened Meadowbank Gold Mine in 2010 as Nunavut’s first new mine development since the creation of the territory in 1999. Mead-

owbank produced two million ounces of gold through September 2015. The mine has a workforce of approximately 800 people, of whom 34 per cent are Inuit.

Studies are underway to extend mining beyond the third quarter of 2018.

Baffinland Iron Mines Corporation began mining and transporting iron ore at the Mary River Project in September 2014. Mary River is an open pit mine with exceptional high-grade ore, located approximately 1,000 kilometres north of Iqaluit, Nunavut’s capital city. The Mary River mine site consists of nine plus highgrade lump and fine iron ore deposits that can be mined, crushed, and screened into marketable products and then shipped through its dedicated port facility. Due to the quality of the ore, no processing is required before shipping it to market, reducing overall impact to the environment and keeping production costs low. Baffinland has adopted a phased development strategy for this resource which is critical to prudent, reduced-risk development.

Located on four parcels of Inuit-owned lands, the Hope Bay greenstone belt has seen significant exploration since 1965, and exploration continues. TMAC Re-

sources Inc. took over the development of the Hope Bay Project from Newmont Mining Corporation in 2013. The greenstone belt includes a permitted mine at Doris North, and the Madrid and Boston deposits. TMAC has measured and indicated resources for these areas comprising 20 years of gold production. During 2015, TMAC secured equity and debt financing for gross proceeds of over $350 M providing full funding for the company to achieve its Path to Production plan, beginning with the Doris Mine in early 2017.

Once Hope Bay is in production, the result will be an operating mine in each of the three regions in Nunavut.

Several exciting exploration projects are at play in Nunavut. The Amaruq project (owned by AEM) is a potential satellite deposit of Meadowbank, located 50 kilometres from the mine site. Construction of the $80 million access road is expected to be complete by the end of 2017. Important drill results have been reported at the project’s Whale Tail and Vzone deposits.

During the past year, AEM has also added significant resources at its high-grade Meliadine project. Meliadine has 3.3 M ounces of gold in proven and probable

reserves. The project is fully permitted and plans for 2017 include upgrading the resources to reserves.

Over the past two years, Sabina Gold & Silver Corp.’s exploration programs have concentrated on the George and Goose properties at its Back River Project, which have deposits at varying stages of exploration. The project currently contains measured and indicated resources of 5.33 M ounces of gold. Sabina continues to receive a high level of community support for its project as it works through the environmental review process.

For its part, the diamond industry is well-represented in Nunavut by Peregrine Diamond’s Chidliak project, located just north of Iqaluit. To date, 74 kimberlites have been discovered with eight being potentially economic. This summer, the company announced a positive Preliminary Economic Assessment for a Phase One diamond development project. North Arrow Minerals has completed an active summer of exploration primarily focused on till sampling programs at two projects in Nunavut, the Mel and Qilalugaq Diamond Projects.

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2017

| Mining North of 60 35

Sampling programs were intended to better define potential drill targets near the heads of well-established kimberlite indicator mineral trains at the Mel Project. Qilalugaqâ&#x20AC;&#x2122;s inferred mineral resource is 26.1 million carats with a total of 48.8 million tonnes.

Early stage exploration projects on the threshold of success include Three Bluffs (gold) owned by Auryn Resources; Anglilak (uranium) owned by Kivalliq Energy Corp.; Coppermine River, a copper and silver project which underwent a multifaceted field program by Kaizen Discovery this past year and; Pistol Bay, another gold project being explored by Northquest Ltd. All of these projects continue to inch towards the feasibility stage and environmental permitting processes.

Currently, Nunavut remains a challenging place to invest in exploration.

Given the lack of infrastructure, remote regions are difficult to access, costs are often prohibitive, and shareholders are leery of investing in exploration where no infrastructure is in place to support the conversion of discoveries to mines. In 2015, the Mining Association of Canada and several industry partners, including the Chamber of Mines, released a study that found that the costs to build base and precious metal mines were two to 2.5 times higher in remote and northern regions of Canada than in southern Canada.

Although it is expensive to do business in Nunavut, the infrastructure deficit can be viewed as an opportunity for those in the transportation and construction sectors. The proposed Grays Bay port and road into the Slave geological province will greatly promote economic development in the region. The project consists of a 227 kilometre all-season road linking the northern terminus of the TibbittContwoyto Winter Road to a deep-water port at Grays Bay on the Northwest Passage. Not only will this major infrastructure create significant new opportunities for Northern and Indigenous communities, and Indigenous and public governments, it will also provide Nunavut with its first land link to southern Canada, truly a nation building development. The proposed project could also boost Canadaâ&#x20AC;&#x2122;s gross domestic product through infra-

36 Mining North of 60 | 2017

structure induced Northern resource development including MMG Canada’s Izok Corridor Project (copper, zinc, gold, silver), located near the border of Nunavut and the Northwest Territories.

Most of Nunavut’s mining and exploration projects are located on Inuit-owned land, and have established or are working towards Inuit Impact Benefit Agreements with the respective designated Inuit organization. These agreements support the development of ongoing partnerships between Inuit communities and the companies. In an economy suffering with over 14 per cent unemployment and 40 per cent of its people receiving some level of social assistance, these agreements can lead to the development of skills and training initiatives that support Nunavut’s community capacity and development, while increasing mining employers’ access to a skilled and engaged workforce.

Nunavut is in the process of preparing to negotiate a devolution agreement with the Government of Canada and Nunavut Tunngavik Inc., the Inuit land claims organization. Devolution will allow Nunavummiut to make decisions on how public lands and resources are used and devel-

oped. A viable minerals industry will be required to make devolution a success.

The Chamber of Mines is the leading advocate on behalf of the Northern minerals

industry. Its vision is to achieve a vibrant and sustainable exploration and mining industry in Nunavut which has the support of the peoples of the North. n

For more information on the mining and exploration industry in Nunavut, contact Elizabeth Kingston at: generalmanagernu@miningnorth.com, or visit www.miningnorth.com. You can follow us on Twitter @MiningNorth.

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| Mining North of 60 37

The Good and the Bad

New diamond mine highlights the year – exploration still wanting

By Tom Hoefer, executive director of the NWT & Nunavut Chamber of Mines

The Northwest Territories continues to be Canada’s major miner of diamonds and in 2015, helped maintain the country as the world’s third most valuable diamond producer. In terms of “sexy”, Diavik discovered its largest ever gem diamond - the 187.7 carat Foxfire. Hot on their heels, Ekati mine discovered their own giant, a 186 carat exceptional gemstone just a few months later. A fitting – albeit purely coincidental – way one might say, to celebrate the 25th anniversary of the discovery of diamonds in the Northwest Territories this year.

The year wasn’t without its challenges however. Two mines ceased operations due to challenging economics: North American Tungsten’s Cantung mine in early fall, and De Beers Canada placed Snap Lake diamond mine on care and maintenance in early December. Six months later, a fire at our largest diamond mine – Dominion Diamond Corporation’s Ekati mine – shut down their processing abilities for about three months, halting diamond production and resulting in temporary layoffs.

All is not bleak though. The negative effects of the past year have been tempered

38 Mining North of 60 | 2017

with continued mining investments. The official opening on September 20, 2016, marked the successful construction – under budget and ahead of schedule – of the new Gahcho Kué diamond mine. Touted as the world’s largest and most valuable new diamond mine, owners De Beers Canada (51 per cent) and Mountain Province Diamonds (49 per cent) expect commercial production in early 2017. The mine is expected to produce an average of 4.5 million carats annually over a 12 year mine life. According to De Beers Canada CEO Kim Truter it will “ensure Canada remains the third leading diamond producer, by value, in the world.” According to De Beers, CAD$1 billion has been invested to develop the site to date, and the mine will generate CAD$5.7 billion to the NWT economy over its lifetime.

Also contributing to the mining economy was ongoing construction at the Diavik mine (Rio Tinto 60 per cent and Dominion Diamond Corporation 40 per cent) to ready their A21 diamond deposit for mining in 2018, a US$350 million investment over four years. And of course, the mine

continues to produce diamonds as per plan.

Efficient repairs at the Ekati mine saw the effects of that fire minimized, and repairs and re-staffing have allowed processing to resume as expected. Production and processing of higher value ore should help soften the blow too.

Looking forward, the Ekati mine received environmental approval to advance their Jay deposit, a project that will add another 11 years to the mine’s life. With a positive feasibility study behind them, the Dominion Diamond Corporation Board of Directors gave their approval to proceed with the US$690 million project. Considering Ekati is the largest mine in the NWT, it is great news for future economics.

A new NWT government was elected last fall, and by early-2016 had released their official mandate. It commits the government to supporting mineral development through a number of actions that will increase investment certainty: settling the remaining Aboriginal land claims, creating land use plans, and advancing three road infrastructure projects that will im-

prove access to the highly prospective territory.

The Conference Board of Canada is making positive growth projections for the NWT in 2017. This is somewhat biased by the opening of the Gahcho Kué diamond mine, but also due to two other projects that have virtually all approvals to proceed in place.

Canadian Zinc’s Prairie Creek silverzinc-lead mine had received regulatory approval to proceed, but is now applying for a new approval to construct an all-season road to the mine site, which will help reduce operating costs for the future mine. Fortune Mineral’s NICO cobalt-gold-bismuth mine has its required approvals, but is looking forward to the construction of a public highway by the NWT Government which will give it the year round access it needs to proceed.

Exploration investment is still wanting, and is at much lower than optimum levels. Despite the ongoing global bear market, we have seen exploration on a number of projects.

The largest is Kennady Diamonds’ project by the same name, not far from the Gahcho Kué Mine, where they continue to grow their diamond deposits. That is followed by TerraX Minerals’ Yellowknife project, in the shadow of the historical Con and Giant gold mines in the NWT capital, Yellowknife, and by Nighthawk Resources, again exploring in the shadow of the old Colomac gold mine. A new entrant this year is Silver Range Resources, who staked and explored four targets in the NWT and optioned their flagship gold project near Yellowknife to Rover Metals.

Mining continues to be strong in the NWT, and its benefits to the local residents, businesses and governments – both Aboriginal and public – continue to be significant. At last count, the last 20 years of diamond mining have generated 25,000 person years of employment, $12 billion in business spending (over $5 billion of which was with Aboriginal firms and partnerships), and over $100 million in community payments. Those results no doubt speak loudly to why a mining survey conducted this past spring by Abacus Data returned the best approval ratings they have seen in their surveys throughout Canada to date. n

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Control Room Operator Ryan Sweeney monitors Process Plant operations from the control room at Gahcho Kué Mine.

Bright Future

The Gahcho Kué Mine will be a boost for both the NWT and Canadian economies When the Gahcho Kué Mine officially opened on September 20, 2016, it brought with it the promise of hundreds of jobs and billions of dollars that will flow into the economies of both the Northwest Territories (NWT) and Canada.

Gahcho Kué is a joint venture between De Beers Canada (51 per cent - the operator) and Mountain Province Diamonds (49 per cent). It is located at Kennady Lake, about 280 kilometres northeast of Yellowknife, NWT. The 5034 kimberlite was discovered on the property in 1995 by Mountain Province. De Beers joined the joint venture in 1997, discovering the Hearne and Tuzo kimberlites.

Over the next nearly 20 years, De Beers and Mountain Province undertook the extensive exploration, evaluation, environmental monitoring, and engineering required to build the world’s largest new diamond mine.

“It has been a long journey to get to this point, but we believe Gahcho Kué has been built on a solid foundation with industrybest environmental practices and with a focus to maximize the benefits that flow to local communities,” says Kim Truter, CEO of De Beers Canada. “Those benefits are only possible when you have a sustainable operation.”

For Mountain Province CEO Patrick Evans, the September 20 opening was the realization of a dream and culmination of plenty of hard word.

“The successful permitting, funding and construction of the Gahcho Kué mine was made possible by the close and collab-

42 Mining North of 60 | 2017

orative partnership between De Beers and Mountain Province.

We are privileged to have the world’s leading diamond company as our operating partner,” he states.

Over the mine’s 12 year life, about 54 million carats of diamonds will be recovered, at an average of 4.5 million carats per year. An open pit operation, three kimberlites will be mined in sequence, starting with 5034, Hearne, and then Tuzo. At full operation, about 530 people will be employed at Gahcho Kué, the majority working a two-week in/two-week out rotation.

Even before the mine began production, it’s estimated that Gahcho Kué provided a $440-million boost to the NWT economy. More than 90 per cent of the mine’s economic impact will be delivered over the remaining life of mine, equivalent to a further $5.3 billion in gross value added to the NWT.

$1 billion investment Building a mine in Canada’s arctic isn’t easy and comes at a high cost. The joint venture spent ~$1 billion to construct Gahcho Kué, with its efficient processing plant, accommodations facility for employees, and network of supporting infrastructure including an airstrip capable of handling Hercules cargo aircraft and Boeing 737 jets.

“We are extremely proud of the fact that we began operations almost three months ahead of schedule and construction came in on budget,” says Allan Rodel, the De Beers head of project who oversaw construction and is now the mine’s first general

Gahcho Kué Fast Facts Location: 280 kilometres northeast of Yellowknife Annual Production: ~4.5m carats annually Capital Cost: $1 billion Employees: ~530 at full production Accommodations: 330 rooms, including full catering and recreation facilities Awards: 2016 Yellowknife Chamber of Commerce Workplace Health & Safety Award; Gold award, Private Project Construction and Engineering, Project Management Institute-Montreal; 2017 Viola R. MacMillan Award, Prospectors and Developers Association of Canada.

Elder Albert Boucher, from the First Nations community of Lutsel K’e, performs a feed the fire ceremony during the official opening of Gahcho Kué Mine on September 20, 2016. manager. “This is a credit to our community partners, the construction contractors, including our hybrid EPCM team of Hatch and JDS Mining and Engineering, and the De Beers employees who supported the construction and who are now instrumental in the ramp up to commercial production.”

Construction began with early earthworks in December 2013, and went into full swing in late 2014, following the receipt of the water licence and land use permit and other authorizations required for construction and operation of the mine. During two winter road seasons, 3,833 truckloads of construction materials, mining equipment and 45 million litres of fuel were hauled to site along a 400 kilometre winter road from Yellowknife.

Commitment to communities During the official opening, Mark Cutifani, chief executive of Anglo American plc, De Beers’ parent company, noted that Gahcho Kué will be considered a success by delivering benefits to the communities close by.

That commitment was demonstrated even before construction began, during the program to remove fish from Kennady Lake as required by the mine development program. Because the three kimberlites to be mined were beneath the lake, the fish-out was required so that the level of the lake could be lowered to expose the lake bottom. Over two summers, more than 18,000 fish were harvested from the lake by teams comprised of community members and biologists. Larger fish were cleaned, filleted, packaged, and frozen on site and were distributed to local communities for use in community events, at an elders home and elsewhere. Small bodied fish were provided to local dog mushers to feed their teams.

Delivering benefits to communities is supported by Impact Benefit Agreements reached with NWT Aboriginal communities, including the Lutsel K’e Dene First Nation, Yellowknives Dene First Nation, Tlicho Government, Deninu Kué First Nation, North

Slave Métis Alliance, and the NWT Métis Nation. These agreements outline how De Beers and the communities will work together to maximize employment, training, and social and other benefits.

In addition, De Beers signed a Socio-Economic Agreement with the Government of the Northwest Territories for Gahcho Kué Mine in 2013, spelling out commitments to NWT employment, procurement from local businesses, training, social investment, and other areas.

Protecting the environment After undergoing one of the most extensive environmental reviews for any mine, Gahcho Kué has developed a robust and extensive environmental monitoring and protection program.

It includes management plans for wildlife, water, air and other monitoring programs that include early warning indicators that trigger action early on, to minimize potential impacts.

In addition to active monitoring programs, the ground breaking Ni Hadi Xa (NHX) collaborative environmental monitoring agency was established during the regulatory process. This group includes representatives from five Aboriginal communities who work closely with Gahcho Kué to understand environmental monitoring programs and provide advice and input.

NHX has its own environmental monitor working on site, shoulder to shoulder with the mine team.

Gahcho Kué is on track to hit full production during the first quarter of 2017 and become a strong contributor to the NWT and Canadian economies for the next decade and beyond.

“What’s important is that the team pull together to shape a strong future for Gahcho Kué,” says Rodel. “Through continuous improvement, all employees can build upon the success achieved so far, to provide benefits to the joint venture partners and enable us to deliver benefits to local communities, through jobs, training, business opportunities, and more.” n 2017

| Mining North of 60 43

Bacteria at Work Designing custom water treatment solutions for Canadian mines

By Kylie Williams

44 Mining North of 60 | 2017

The Canadian mining industry is held to some of the highest environmental regulations and social standards in the world. Water protection and management is central to the federal, provincial, and territorial laws that regulate new mines and major expansions, and critically important to all of the peoples who call Canada home.

Responsible and sustainable mine design requires minimizing the footprint during operation and preventing any pollution to surrounding waterways after closure and site rehabilitation.

Preparing mine-affected waters to be released from a site, in accordance with local regulations and to ensure an ongoing social licence to operate, is a top priority but traditional water treatment plants can be expensive to construct and maintain over time.

“When you look at operating an active water treatment plant, you are consuming electricity, heating large spaces, and need staff on site all the time to operate the facility. You quickly end up with a large carbon footprint, ongoing light, and noise pollution, and the risks associated with transporting chemicals and reagents great distances to treat the water,” explains Dr Monique Haakensen, president and principal scientist at Contango Strategies, who custom-design passive water treatment systems for mining and energy facilities across Canada.

Passive water treatment systems require no electricity or chemicals, and human operators are replaced by natural bacteria, aside from periodic upkeep and maintenance. Examples include certain wetlands, in-pit and underground in-situ treatments, some types of bioreactors, and certain permeable reactive barriers.

“Passive treatment itself is not new,” explains Haakensen. “People have been using treatment wetlands in mining for over 60 years, but the technology being used now is totally different.”

A combination of increased computer power and a deeper understanding of microbiology has propelled water treatment technologies forward. Understanding how bacteria and microorganisms live and work leads to the design of more efficient water treatment facilities.

“If you’re relying on a microbe to do the work for you, it makes sense to know what microbe you’re working with,” says Haakensen, “Genomics is currently the only method that can tell us what those microbes are.”

Genomics combines biology, genetics, and computer science to see how organisms interact with their environment. Since the human genome was sequenced in the year 2000, and the price of sequencing genes has decreased, genomics has found applications in all sectors, from human health and agriculture to mining and energy.

“It’s a problem-solving tool,” explains Dr. Anikó Takács-Cox, manager for Mining, Energy and Environment Sector at Genome BC, one of six geographic sub-sections of Genome Canada devoted to funding genomics research and expanding its applications. “Using genomics we can link pollution in water directly to it’s source by looking at the microorganisms in the water. By looking at an organism’s genes, the proteins expressed by genes, or the metabolites released by proteins, scientists have worked out how to treat run-off coming from a mine, oil sands operation, or forestry plantation. It’s a genetic fingerprint.”

Bacteria plays the central role in passive water treatment sys2017

| Mining North of 60 45

tems at mine sites. A number of bacteria species are able to convert the sulphates that are produced during mineral extraction and processing, back into the original sulphide form and precipitate metals out of the water. These bacteria carry out this process in natural wetlands and can be encouraged to do the same in constructed wetlands under the right conditions.

“Bacteria are everywhere; we don’t need to add them in. We design something like a wetland that will give the right kinds of bacteria the right environment to do the activity we want,” says Haakensen, explaining the four-step process Contango use to custom-design passive water treatment systems for the industry.

The initial step involves looking at the natural plants available and assessing them as habitat for microbes, characterizing the chemistry of the water on and off the mine site, and identifying any carbon sources, such as woodchips, straw, or hay, required to start the biological processes.

Next, they replicate those conditions at an off-site pilot-scale testing facility and control as many variables as possible. In the case of the constructed wetland treatment system (CWTS) planned for the NICO gold-cobalt-bismuth-copper mine in the Northwest Territories, it was even necessary to create synthetic water during these tests to predict the water chemistry at the site. Fortune Minerals Limited has permitted the project but not yet constructed the NICO Mine. The development of a credible water treatment system after closure was a required element of the permitting process to ensure protection of the environment in the long term.

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Naturally elevated arsenic is found in the water around the NICO site. For thousands of years, water running off the outcropping mineralized rocks on the hills at the NICO site has picked up arsenic and then flowed through natural wetlands, so the team were able to study how the natural environment was treating the water in the area, and attempt to replicate it.

“The CWTS was chosen because it represents a long-term water quality treatment system that requires little or no maintenance. This was an essential factor for choosing a system that would work under closure and post-closure conditions” says Dr. Rick Schryer, director of Regulatory and Environmental Affairs, Fortune Minerals.

The third stage involves building a demonstration-scale treatment plant on site. At Capstone Mining’s Minto Mine in the Yukon, a demonstration-scale CWTS was built at the end of 2014. Minto Mine is operating at full production from both open pit and underground deposits as of summer 2016, and the CWTS is in its second year of testing. The results to date have been favourable, with signs of treatment for both copper and selenium observed during testing.

“So far, Minto Mine has undergone pilot and demonstration scale testing using actual site water and wetland plants,” explains Ryan Herbert, environment manager at Capstone’s Minto Mine.

“This technology was selected as potential solution for water treatment postclosure due to its ability to treat water

48 Mining North of 60 | 2017

Passive water treatment technologies are being trialled at a number of sites across Canada and are increasingly being recognized as a sustainable choice for treating water during operations and long after closure. The ideal water treatment plant, says Haakensen, would be different for every single mine, and include 10 to 20 species of microbes carefully selected

to suit the specific mineralogy of rocks, soil, and water at the site. Provided with the right conditions, these tiny bugs will help responsible mining companies release clean, mine-affected waters off-site for many years, meeting their regulatory requirements, and addressing the environmental concerns of neighbouring communities. n

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with limited operational and maintenance requirements. It’s the most passive treatment option available for closure, with the potential to perform over a long period with limited maintenance and operational oversight.”

Passive water treatment systems work under a range of weather conditions, including freezing winter temperatures. At the Minto Mine, the same treatment efficiency was observed at cold temperatures as during the warmer months.

The final stage involves building a fullscale water treatment plant on site. This should simply be a construction project, says Haakensen, as the experimentation and optimization have been worked out during the pilot-scale and demonstrationscale tests.

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Change is in the Air

Canadian mining industry readies and adapts in response to climate change

By Melanie Franner Canada is one of the largest mining nations in the world. According to Facts & Figures 2015 (produced by the Mining Association of Canada), Canada produces over 60 minerals and metals. The industry employs some 375,000 people and contributed $57 billion to the country’s GDP in 2014.

It is also one of several industries that may be impacted significantly by global climate change.

“We’re already seeing the impacts of climate change, such as the increase in temperatures and changes in rainfall intensity,” states Al Douglas, director of Climate Change Adaptation at MIRARCO Mining Innovation. “The mining industry does have it challenges when it comes to climate change, as do other industries.”

Douglas cites the example of tailings ponds as one area of mining operations that could be impacted by climate change.

“If we experience drier conditions, then it can lead to more dust and more oxidization of the tailings,” he says. “If we experience wetter conditions, it could mean overtopping of the dams.”

Those companies relying upon surface water for their processing activities or

Al Douglas, director of Climate Change Adaptation at MIRARCO Mining Innovation.

50 Mining North of 60 | 2017

those who share assets (such as transportation and power) with local communities are also susceptible to changes in climate change.

“Changes in climate bring different kinds of impacts,” adds Douglas. “We will experience it in different ways. Drought in northern Ontario, for example, can create larger risks for forest fires. Too much rainfall may cause flooding, which can have an impact on open-pit mining. There are certain aspects within mining that are at greater risk to climate change.”

In the books A 2009 study released by the David Suzuki Foundation, entitled Climate Change and Canadian Mining: Opportunities for Adaption, identified several examples of ways that the mining industry has shown its vulnerability to climate change. These include: • A multi-year drought in Saskatchewan in the late 1980s that resulted in the Chaplin sodium sulphate mine nearly halting production due to reduced water levels; • In 2005, a similar situation in Marathon, Ontario, resulted in several mines reducing water intake and finding alternative resources; • Hot and dry temperatures in recent years have decreased the availability of water in southern Quebec, forcing gravel quarries to curtail production in order to abide by dust-suppression regulations; • The 1998 ice storm cut off power to several mines in Quebec for three to four weeks; • Warm winter temperatures in 2006 led to ice-road closures in the North West Territories, costing diamond mines millions of dollars for fuel and equipment to be transported by air; • In 2008, heavy rains in the Yukon flooded

four kilometres of the Minto mine access road and forced the company to release excess untreated water directly into the Yukon River system; and • Lower water levels in the Great Lakes have necessitated smaller shipping loads of metals and non-metals.

As a result of these extreme-weather situations, more and more mining companies are beginning to think about climate change and how it can impact their operations.

“I think mining companies are beginning to appreciate that these challenges are becoming more significant,” states Douglas. “Our previous assumption that climate change is static was not correct.

Companies now have to start thinking of how to incorporate these changes and how they can assess the risks.”

An industry in flux Although climate change may be more top-of-mind today than ever before, it isn’t necessarily getting the recognition it deserves within the mining community. A survey of 26 Canadian mining companies, undertaken by the Mining Association of Canada and documented in a 2014 report entitled Climate Adaptation in the Canadian Mining Sector, found that one-third of those polled consider climate change a medium to low-level risk for their business operations.

Another one-third reported that they have committed resources to understanding how they will adapt their operations to deal with climate change, with the most common nature of the actions considered or taken having to do with engineering and design, followed by infrastructure upgrades, and changes to business procedures.

Of note in the survey is the fact that many companies believed there was a lack of information and tools related to

the subject. A few companies reported difficulties in obtaining accurate and sufficient scientific data and the majority of respondents felt that better projections of future climate changes – along with information on climate change impacts – would be useful.

Another key finding of the study had to do with the role of government and industry. More than half of those surveyed said they would like to see better projections of future climate changes and impacts by region in order to predict the effects on their particular operations. They would also like to see examples of good practices, information on risk-assessment methods and tools; adaption-planning frameworks; and sample business cases.

There is also broad support for the government to play a larger role, including support for policies, incentives, and regulations for climate change to “de-risk” the mining industry.

The way forward Despite the fact that climate change continues to be a major topic, it would appear the Canadian mining industry has not yet fully embraced the potential impacts of these potential events to their operations. The hope, however, is that this will change.

“There is a lot more attention in general

being given to the topic of climate change and a lot of information is being shared between government and non-governmental organizations,” says Douglas. “But what has to happen is we have to have more sharing of this information and we need to see more adaptive planning happening within companies.”

Positive actions that Douglas believes should already be happening within the industry include detailed analysis of the variables (such as flooding).

“Companies should put to use their engineering skills to study the intensity of rainfall and other extreme weather events,” he advises. “Technical data on intensities can be used to support better decision making in companies, such as the need to build better tailings ponds or the need to at least provide better maintenance of those tailings ponds.”

Such actions, believes Douglas, will make companies more resilient and better able to withstand the risks in their area to safeguard business continuity. It will also work to safeguard and protect the community and ecosystem, he adds.

“There are wins all around for why companies should be doing these things now,” he states. “Companies can incorporate this data at a local level and can extract data from other levels to look at their supply chains in other areas in order to determine how climate change could affect

the flow of materials, sale of raw materials, movement of goods, and other critical processes.”

Although there remains a great deal of work to do, Douglas believes that the occurrence of ongoing extreme weather events will continue to draw increased attention to the topic.

“I think we’ll see more pick up due to some of the more extreme weather conditions that seem to be happening more regularly now,” he adds. “It’s just a matter of time before companies will be forced to think about how these changes will impact them and to develop adaptation strategies to minimize negative impacts to infrastructure and operations.”

Of course, in the end, one of the big drivers will be the bottom line.

“When the risks become material, when companies want to safeguard their profitability and the safety of their employees – that’s when we will see them push themselves and adapt,” concludes Douglas. “That’s when real changes will begin to occur.” n 2017

| Mining North of 60 51

Inside the Hive Crowdsourced prospecting is the bee’s knees

By Kylie Williams

If there is a silver lining to the recent mineral industry downturn, it is the rise of innovation and disruptive ideas. The latest slump inspired geologist and entrepreneur, Andrew Randell, to create Hive, a geological crowd consulting and mentoring service.

Crowdsourcing connects businesses with groups of people to access knowledge, funds, labour, or creativity for a specific purpose. Randell saw a way to use this modern, solution-driven business model to keep young graduates from leaving the struggling industry and to help prevent the brain-drain that will inevitably hit when the industry recovers.

“Hive creates opportunities for companies to move a project forward at a competitive rate, but at the same time, engages graduates who need relevant work experience,” explains Randell.

Hive takes data from an exploration project and, under the guidance of a registered professional geologist, divides the work

52 Mining North of 60 | 2017

amongst a willing group of university students and recent graduates. Since its inception in 2015, over 30 Hive participants have worked collaboratively on four Canadian projects and one in the Philippines.

“This type of hands-on mentoring provides practical experience on real data that isn’t taught at school,” says Randell, “The students and graduates have approached me through word-ofmouth. They are self-selected and motivated.”

The first prospector to take a chance on the Hive concept was William Koe-Carson, who was looking to advance the McConnells Jest project in the Yukon. McConnells Jest is nestled between the Keno Hill mine and several advanced-stage projects, including Victoria Gold Corp’s Eagle and Dublin Gulch projects, in an active and prosperous area of the central Yukon.

“In what I think we can all definitively say has been a bear mar-

ket until very recently, the opportunity to continually advance the project and produce quality, professional results is worth its weight in gold,” says Koe-Carson, who handed over more than eight gigabytes of information, including geochemical data, photographs, claims information and field diaries, to Randell after he pitched the Hive concept to him at a conference in 2014.

Randell and a team of four Hive participants organized and analyzed the McConnells Jest data to produce a comprehensive report that follows the structure of a National Instrument 43-101 for the client in April 2015. The report identified some prospective new structures and was used to apply for funding through the Yukon Mineral Exploration Program, resulting in the first official Hive field trip in August 2016.

Together with recent geology graduate, Fraser Kirk, and a biologist, Randell travelled to the Yukon on a lean budget to survey the infrastructure, carry out geological mapping, collect samples for geochemical analysis, and begin a baseline environmental study.

“The work undertaken by the Hive group helped direct future exploration work and brought new data that became the cornerstone of raising funds for exploration in 2016,” says Koe-Carson, “This resulted in the discovery of a rich, new mineralized gold zone on the property.”

Hive clients are happy to advance their projects at a competitive price and bask in the altruistic benefit of helping young geologists. But for the under-employed young geologists themselves, who are paid a modest hourly rate for their efforts, it provides relevant, hands-on work experience that is hard to find during challenging economic times. As for the industry as a whole, it keeps the talent pipeline stocked with trained, motivated geologists.

“As a recent Masters graduate entering the mining industry during a downturn, it was incredibly difficult to find opportunities to exercise my advanced geological training,” says Kirk. “Working with Hive, I was able to learn about new deposit styles and the key factors of reporting for different stages of project advancement.”

Hive exposes the participants to the full exploration project experience beyond the textbook geology knowledge gained at university. Tasks range from data management and logistics, to field safety, community engagement and environmental monitoring and, in the course of a project, they may be exposed to regulatory permits, memorandums of understanding, non-disclosure agreements and more.

“Without the experience of the Hive, I may have been forced to consider my career options outside of the mineral exploration industry,” says Kirk, “Since working with the Hive, I have been fortunate enough to gain a short term contract with a junior exploration company, close to McConnells Jest.”

Randell plans to grow the Hive, even as commodity prices improve and investor confidence returns to the mineral industry. He hopes it will inspire the industry will implement more modern business ideas, like crowdsourcing talent and practical mentoring schemes.

“Hive helps retain graduates and provides companies with an opportunity to employ these individuals after, given their indepth project knowledge,” says Randell, “These graduates blend the traditional business of exploration with contemporary perspectives on collaborative project work, fast-tracking the much needed modernization of our industry.” n 2017

| Mining North of 60 53

Partners in Industry

Increasing Aboriginal business engagement in Canadian mining Kylie Williams

Sean Willy, creative fire and vice-president, Des Nedhe Development, Max Skudra, senior manager, Research, Canadian Council for Aboriginal Business, Anthea Darychuk, research manager, EWB Canada, and Darrel Burnouf, manager, business development and Northern affairs, Cameco Corporation at Cameco headquarters in Saskatoon.

In July 2015, the Red Chris Development Company Ltd. and the Tahltan Nation signed an Impact, Benefit and Co-Management Agreement (IBCA), creating a unique partnership between the Tahltan people and parent company, Imperial Metals, for the life of the Red Chris mine in northern British Columbia. It outlined provisions for communication and interaction on social and environmental issues, and covers education, training, employment, capacity support, and contracting opportunities.

The Tahltan First Nation stands out as an Aboriginal procurement success story, having grown from a small construction company in 1985 into the Tahltan Nation Development Corporation (TNDC), providing goods and services to all of the companies operating in the resource-rich Stikine River catchment.

54 Mining North of 60 | 2017

After the tailings dam breach at Imperial Metalsâ&#x20AC;&#x2122; Mount Polley mine in 2014, signing the IBCA with the Tahltan, and, in particular, creating the Red Chris Monitoring Committee to monitor tailings storage, ensured not only regulatory compliance for Imperial Metals, but an ongoing social licence to operate (SLO).

Aboriginal entrepreneurs and businesses like the TNDC have become an integral part of mining supply chains across Canada.

For mining companies, maximizing procurement from Aboriginal businesses not only contributes to their SLO, but establishes a reliable source for goods and services and a local workforce for the life of the mine and beyond.

Through strategic partnerships, Aboriginal businesses in mining have evolved from mostly small, labour-intensive ser-

Tahltan Nation Development Corporation employees at the Red Chris Mine in Northern B.C., owned by Imperial Metals.

vice providers, such as janitorial staff and cooks, to contractors responsible for managing multi-million-dollar projects, partners in joint ventures, and suppliers of professional drilling, construction, transport, and environmental services.

However, a number of barriers specific to Aboriginal businesses in mining exist. Entrepreneurs and small to mediumsized enterprises (SME), in particular, need a hand to overcome these barriers and fully realizing the economic development opportunities that resource projects in their territories present. These barriers are currently being explored by a collaborative research project between the Canadian Council for Aboriginal Business (CCAB) and the Mining Shared Value (MSV) venture of Engineers Without Borders (EWB).

“The two most important barriers are difficulty accessing capital loans and equipment, and education,” says Dr. Karen Travers, research analyst at the CCAB, explaining it can be difficult to establish and expand, particularly for those living on reserve land which cannot be used as collateral on a loan.

“Banks can be reluctant to lend money to Aboriginal businesses," says Travers.

“The business owners we spoke to believe there is a false perception of risk with an Aboriginal business and that they are subjected to stricter criteria.”

Access to post-secondary education, skills development, and reliable business forecasting information are also barriers, explains Travers, together with a lack of infrastructure, especially in remote areas.

The absence of all-season roads for trans-

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| Mining North of 60 55

The Tahltan Nation Development Corporation (TNDC) was established in 1985, and has grown into a specialized contractor relied on by the resource industry in Tahltan territory, Northern B.C.

56 Mining North of 60 | 2017

porting goods and unreliable internet for online banking compound this disadvantage.

The MSV-CCAB project is investigating the economic and social impacts of procurement from Aboriginal suppliers and developing a business case for mining companies to procure goods and services from Aboriginal businesses.

“One of our main roles is collaborating and coordinating corporate, community, and government players,” explains Anthea Darychuk, research manager with EWB Canada. “We do onthe-ground research to inform policymaking at higher levels of government and intergovernmental organizations, but we also identify and share the best practices so people are not replicating or recreating resources.”

This coordination role is especially important in 2016 as the mining industry emerges from several economically-challenging years. Even in a highly regulated industry, Darychuk explains, “everybody works in their own bubble” and mining companies and Aboriginalrun businesses often keep their heads down and try to find their own way through a changing legal landscape.

Aboriginal communities expect to be considered in the development of new mining projects and to benefit from the mining activity in their territory.

“The overall political feeling in Canada right now with the Truth and Reconciliation Commission and the adoption of the United Nations Declaration on the Rights of Indigenous Peoples has created an environment where it’s not so much if you are going to engage, but how,” says Travers.

The government has handed a substantial amount of the consultation process onto businesses, and those conversations largely cover employment, training, and economic development. A concerted effort from all stakeholders, rather than a patchwork of programs, is needed to bridge the gap that currently exists between the technical and labour needs of the mining industry and the business and workforce capacity of local Aboriginal communities.

Communication is key, according to the highly successful Secretariat to the Cree Nation Abitibi-Témiscamingue Economic Alliance (SAENCAT). Estab-

Air Labrador is an Inuit-owned business, owned by the Nunatsiavut group of companies, who fly to more than 18 sites in Northern Labrador, Quebec, and Newfoundland, including the Voisey's Bay mine in Labrador.

lished in Quebec in 2002, the SAENCAT connects Cree entrepreneurs, large and small businesses with the non-Aboriginal businesses working in the James Bay territory and the Abitibi-Témiscamingue region. Two important initiatives of the SAENCAT include an online Cree Business Directory and organizing regular meetings and conferences to bring everyone together.

Mining company budgets are tighter than they used to be, explains Darychuk,

and several companies that the MSVCCAE researchers interviewed didn't have the funds for staff to go into the community and seek businesses out.

"If communities can create registries of their own local assets and capacity, it makes the whole process a lot smoother, and opens up more possibilities for Aboriginal businesses to be recognized and contracted earlier," says Darychuk.

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| Mining North of 60 57

Haven’t Reached a Peak

SUMIT initiative still delivering results

By Melanie Franner

The $6.7-million collaborative R&D initiative managed by the Centre for Excellence in Mining Innovation (CEMI) continues to attract interest. The project – Smart Underground Monitoring & Integrated Technologies (SUMIT) – is a six-year program led

by Laurentian University in partnership with Queen’s University and University of Toronto. It came to a conclusion in June 2016.

“This has proven to be a significant program for CEMI in that it has enabled us to demonstrate that collaboration can happen in the mining industry, not only among the mining companies themselves but with universities and government,” states Damien Duff, vice-president, Geoscience & Geotechnical R&D, CEMI, who adds SUMIT has resulted in some very

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high-level accomplishments from both a geotechnical and energy-optimization standpoint.

SUMIT successes Started in 2010, the SUMIT initiative came out of a series of six workshops that involved industry researchers and participants from all over the world. It focused on three challenges associated with deep underground mining: rock-mass characterization (to anticipate risks and interpret dynamic processes); enhanced mine development (for faster mine construction and increased economic returns); and sustainable deep mines (though energy optimization and underground environmental controls).

Getting the level of collaboration

among academia, industry and government that was required to make the SUMIT initiative a success involved a fair bit of resources and energy.

“The mining industry at the time wasn’t doing so well,” explains Duff. “The crash began in 2008 and continued through to 2012. It wasn’t the optimal time to get the mining industry to contribute funding for the project. There was also some effort involved in getting the industry researchers to work with industry and collaborate among themselves. There may have been some challenges at the outset but once we had the processes in place, everyone came through and saw the benefits of the program.”

As a result of this intensive level of collaboration, SUMIT proved to be a highly

In the end, the SUMIT initiative involved 98 highly-skilled technical people made up of research leads, students, postdoctoral fellows and other expert professionals. It entailed 959 student hours of in-mine work at four test sites. And, it has already resulted in the spin-off of a new company, growth for existing companies and the filing of new patents for new products ready for commercialization.

Rippling effect

successful initiative on several fronts.

“SUMIT has made several significant R&D advances which are sure not only to help the mining industry deal with ground stability-related issues at depth but to optimize its energy usage at the same time,” states Duff.

Among the extensive list of geotechnical accomplishments made through SUMIT are: • New industry guidelines for the selection of ground support elements in underground mines; • New software tools facilitating the selection of optimal ground-support strategic designs based upon existing or anticipated rock-mass conditions; • New ideas for tools and techniques to allow the use of geophysics as a proxy to monitor stress distribution; • Advanced techniques for the measurement of change using LiDAR and fiber optics-based strain-measurement tools

• Development of the first dynamic (time variant, time stamped) 3D deep-mine model through the integration of geology, physical rock properties, infrastructure, production and backfill data; and • Advancement in the state-of-art and state-of-practice techniques for using continuum numerical models to replicate rock-mass deformation and a demonstration of their ability to replicate actual behaviours observed in-situ.

Several accomplishments were also made on the energy management front, including: • Development of optimized cooling strategies for natural heat-exchange areas using computational fluid dynamics modeling; and • Demonstration of how Hydraulic Air Compressor (HAC) technology could one day be used to provide an energyefficient and cost-effective way to cool mines.

Part of the SUMIT legacy is the breadth and number of innovations developed that have the potential to benefit the deep underground mining industry. This was none more apparent than in the final SUMIT workshop, held in June 2016.

“We had over 100 people attend, among which were 20 SMEs from the mining technology space,” states Duff. “All were eager to hear the final report on the research that was conducted.”

According to Duff, CEMI is a strong proponent of the adage that innovation occurs only when research is implemented. To that end, these 20 SMEs or “commercializers” who are in the business of developing technologies for the mining industry are currently being queried by CEMI to see if they intend to work with researchers to try to commercialize any of the technologies developed and, if so, how CEMI can continue to play a role to help facilitate that and/or locate funding.

“Right now, we’re looking at ways to connect the researchers with industry to help fund initiatives that hold the potential to further benefit the deep underground mining industry,” concludes Duff. n 2017

| Mining North of 60 59

Strength in Numbers

Building gender diversity in mining

By Sarah Gauen, manager, Diversity Initiatives and Courtnay Hughes, manager, Manager of HR Research, for Mining Industry Human Resources Council (MiHR)

MiHR’s latest national labour market report details that in 2016 women accounted for 17 per cent of the Canadian mining workforce - only a slight increase from the 14 per cent noted over 10 years ago and substantially below the overall Canadian workforce at 48 per cent. We can see things are changing, but when we look at the overall representation the impacts are fairly minimal.

This slow pace of change isn’t consistent across all jobs, in fact the mining industry faces broad underrepresentation of women layered over specific occupational gaps. When we compare the representation of women in occupational categories in mining, to the representation in all industries - we see that gender gaps are prevalent across occupational categories in the sector. Even in occupations that traditionally have low female representation, such as Science, Technology, Engineering, and Math (STEM)-related professions; the mining industry has not attracted a representative proportion of women into the sector.

The underrepresentation of women has been causing increasing levels of alarm in and out of the sector - a developing appetite for addressing gender equity in mining has resulted in an upswing of activity, research, conference panels and initiatives joining the chorus of those working on the issues at hand.

Recently, MiHR published a national study on gender in mining, Strengthening Mining’s Talent Alloy: Exploring Gender Inclusion, which looked at the experiences of women and men in mining and provides insights on the challenges and solutions that are available to foster greater inclusion. Key findings include:

60 Mining North of 60 | 2017

Mining workplaces are perceived and experienced differently by men and women: In general, the respondents to this study indicated that their mining workplaces were characterized as respectful. However, women had less positive experiences than men were more likely to report seeing put-downs, harassment and a lack of team atmosphere.

Work-life integration is a challenge for everyone: The ability to integrate work with personal and family demands continues to be a challenge for women – particularly in remote locations and FIFO assignments. However, there is a growing recognition that these issues are not “women’s issues” as men are taking larger family responsibilities outside of work and millennials have greater expectations around flexibility.

Workplace culture perceptions impact recruitment and retention: The women in this research were more likely than men to expect to leave the sector within the next five years. Not surprisingly, survey respondents who were less comfortable in their current mining workplace were more likely to leave the sector within the next five years.

Accessing mining networks remains a barrier to greater workforce diversity: Finding out about job openings and career opportunities in mining is a continued challenge. Having a personal network appears to be critically important – yet women highlighted that it is difficult for them access these networks.

Workplace harassment is harming mining workers: Overall, the survey results indicated that in many workplaces, harassment incidents are infrequent – more than half of the survey respon-

dents reported – that they “never” or “almost never” see harassment, bullying, or violence in their workplace. Nonetheless, one in five “see” it once a month or more, and one in eight "experienced” it once month or more. Almost a third of women respondents (32 per cent) said that they have experienced harassment, bullying, or violence in their workplace in the last five years; less than half as many men (16 per cent) said the same.

It has taken time, effort, and some challenging conversations, but the voices and message of industry diversity champions, researchers and critical advocacy work by groups is being heard.

Many mining companies are digging into the root causes of these unintended barriers and committing to making real change. MiHR’s Gender Equity in Mining (GEM) initiative has engaged Champions who have committed to making changes in their companies including revising recruiting polices, diversifying hiring panels, considering the unique needs of Indigenous women, and using inclusive language in their job postings to name a few. Helen Francis, chair of the GEM Taskforce and Vale’s general manager of Business Effectiveness believes, “it is both an obligation and in my best interest to Champion Gender Diversity. I want to work in an industry and company that will make the best decisions for today and for future generations to come - we won’t have the best if we only attract a certain homogeneous sector of society.”

Need for continued insights and action MiHR’s recent gender and inclusion activities have revealed that many companies are at different points on their journey towards gender inclusion. There are still many topics that we do not

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fully understand including – the gender pay gap, the need for targeted solutions, the impacts of mid-career attrition and intersections between race/ethnicity/disability and gender. And those insights we have captured in our research still require collaborative action from a variety of industry stakeholders.

This involves all of us asking some tough questions– and ultimately determining how we would define success. What collectively, are our gender equity goals? What are we working towards?

What actions are most likely to get us there? If you are interested in being part of this discussion, MiHR is currently developing a national strategy and research agenda on diversity and inclusion and launched a diversity in mining online community in October 2016. Add your voice to the conversation, and your conviction to actions that will impact equity in mining. n

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| Mining North of 60 61

Power Up

Northwest Territories lithium and cobalt set to power the next generations of cars

By Michael Schwartz

Tesla CEO Elon Musk has announced plans to construct a $5-billion, 10-millionsquare-foot factory in Nevada which will build the batteries to power his annual target of 500,000 battery-powered cars by 2018. Key to production is a secure and large supply of lithium and cobalt to energize the batterie. This article looks at the potential of two Northwest Territories companies as Tesla seeks out lithium and cobalt sources.

One estimate is that Tesla will require 25,000 tonnes a year of lithium hydroxide to achieve the planned battery output.

What with the cobalt requirement for the batteries it is obvious why these NWT companies look forward to success.

Adrian Lamoureux, president and CEO of 92 Resources, has acquired land around Hidden Lake north of Yellowknife. He asked and answered his own question, “Tesla needs supply. Now, do they want to be paying the sometimes $20,000/t

62 Mining North of 60 | 2017

that lithium is fetching over in Asia? No. They want something a little bit closer to home."

When it comes to cobalt, there is the NICO project near Whati, NWT. Fortune Minerals has spent around 20 years working NICO. President and CEO Robin Goad has declared his respect for Elon Musk, describing his company as innovative and remarkable and Musk himself as an incredible salesman. All these factors will help Fortune Minerals’ ambitions regarding Tesla. Furthermore, one major producer of cobalt is the Democratic Republic of the Congo, long regarded as risky for mining companies.

The right time to invest?

Once again, while 92 Resources is in the early stages of involvement, Lamoureux is enthusiastic regarding a lithium mine near Hidden Lake. ”I wouldn't rule out this decade. Within

a few years is definitely possible," he says, when asked to put a date on a potential mine. “The market doesn't lie. This supplyand-demand issue is critical and I want 92 Resources and the NWT to be part of the green energy supply chain."

92 Resources set for key role The Hidden Lake Lithium Property, which 92 Resources wholly owns, comprises claims totalling approximately 1,100 hectares. Located just north of Highway 4, around 40 kilometres east of Yellowknife, Hidden Lake is regarded as highly prospective for spodumene-bearing lithium pegmatites.

More recently, 92 Resources sampled Hidden Lake’s LU12 pegmatite over an approximate 10 metre by 300 metre exposure. Seven samples from surface trenches contained between 1.37 per cent and 3.01 per cent Li2O, attributed to observed concentrations of coarse-grained spodu-

mene, with crystals up to 36 inches long also noted.

“The two new claim acquisitions at Hidden Lake cover potential subsurface extensions to a historic lithium occurrence, and provide the company with additional lithium exploration opportunities near Hidden Lake,” explains Lamoureux. “Our goal is to identify as many lithium-bearing pegma-tites within the area as possible and, given the discovery on the property of additional spodumene bearing pegmatites during the recent programme, the immediate area is that much more prospective. The region hosts several high-grade lithium pegmatites, but we will need to achieve a certain critical mass to be in the same conversation as advanced lithium pegmatite projects and operating mines worldwide such as Greenbushes in Australia and Nemaska in Quebec. Given the increasing political urgency which we find ourselves in with respect to green energy,

we believe there is a window of opportunity for the NWT to play an important role in fulfilling that vision of a greener world.”

Field work began in late August and consists of simple surface rock sampling of the known lithium pegmatite(s) and exploration within the claims for new occurrences. On August 30, 2016, 92 Resources announced they had completed surface sampling the LU D12 Pegmatite and had identified three others that, after visual examination, look similar to the known mineralization at LU D12. This discovery has made for a very exciting week, but the company remains cautiously optimistic as the industry has seen many “visually exciting” discoveries that didn’t pan out so well, he states.

Regarding the processing of the spodumene pegmatites, Lamoureux points out the similarities with Greensuhes, the world’s largest lithium mine, in Australia which has been producing lithium for over

25 years. There, the pegmatite is mined, crushed and ground, with the spodumene liberated and concentrated by gravity methods and flotation. At Greenbushes, too, a concentrate is produced and sold, with the lithium extracted elsewhere.

Challenge from lithium brines?

Lithium occurs in many forms such as hard rock deposits (predominately pegmatites like Hidden Lake), brines (continental, geothermal, and oil field) and clays (such as hectorite). The world has vast lithium resources within each type of deposits, but the economics of extraction can vary.

Hidden Lake is a relatively simple project, but some brines such as the oil field type find lithium in solution with numerous other elements such as magnesium.

In this example, the world may have vast resources of lithium but the presence of magnesium can make lithium extraction very difficult and prohibitively expensive.

2017

| Mining North of 60 63

“There are many pros and cons to both brine and hard rock deposits,” explains Lamoureux. “However, we expect both to remain significant suppliers of lithium to the market for the foreseeable future. One large advantage that hard rock producers have over brine operations is the greater ability to quickly increase, or decrease, production to match market dynamics.

This allows a greater flexibility to capture market upside as seen with recent LCE price increases.”

92 Resources has a great opportunity to be part of the conversion to a green future and it is critical that we do so in a responsible manner, adds Lamoureux.

“Goldman Sachs has said lithium is the new gasoline and, even if that is partly true, then for many there will be lifelong opportunities to be part of a new and exciting future that sees the world transition from one form of energy to another,” he says. “The reasons for the transition are the same fundamental principles behind CSR. One must respect the land, the communities and its peoples, and the process of sustainable development, as this is the only path forward. We want to contribute to that green future in a green way, responsibly and respectfully of the lands and communities where our projects are located. We want to act in a way that affects the local population positively, and include them in these new opportunities brought by this green economic revolution.”

Fortune eyes up cobalt opportunities Fortune Minerals wholly owns the NICO cobalt-gold-bismuth-copper project, having spent over $115 million in advancing it from an in-house discovery in the mid1990s to a development asset with a positive feasibility study and environmental assessment approvals for the mine and its concentrator in the NWT, and for its refinery in Saskatchewan. NICO has also been test-mined and pilot-plant processed.

64 Mining North of 60 | 2017

The principal use of cobalt is in the cathodes of high performance lithiumion rechargeable batteries. Over the past few decades cobalt in batteries evolved from nickel-cadmium batteries, to nickelmetal hydride batteries containing more cobalt, to today’s lithium-ion batteries with up to 60 per cent cobalt by weight.

Cobalt-containing lithium-ion battery chemistries provide greater energy density and superior chargeability than batteries without cobalt and are therefore preferred in portable applications and electric vehicles. Lithium-ion batteries are expected to dominate the rechargeable battery industry for at least the next decade because of the long lead times required from the invention of new products through validation to acceptance with minimal liability risks.

Demand for cobalt in battery chemicals increased 12 per cent in 2015 and is expected to pressure the market with double-digit growth in the coming years; over the last two decades demand has grown at compounded annual growth of approximately six per cent. The market is now roughly 110,000 tonnes with batteries accounting for about 49 per cent, up from one per cent in the mid-1990s.

Automotive electrification and stationary storage cells to store electricity from intermittent wind and solar generation and off-peak charging from the electrical grid will also create growth. At least 12 battery mega factories including Tesla’s have been either announced or are under construction to meet expected demand.

“NICO’s proven and probable mineral reserves total over 33 Mt to support a 21year mine life at a planned mill throughput rate of 4,650 t/d of ore. Economically attractive is a high concentration ratio with flotation reducing the ore to approximately 180 wet t/d of bulk concentrate containing the recoverable metals,” explains Troy Nazarewicz, investor relations manager at Fortune Minerals.

“The concentrate is planned to be shipped south to Fortune’s refinery in Saskatchewan for downstream processing to value-added metals and chemicals.

Life of mine average annual production is projected to be 41,300 oz gold, 1,615 t bayyert-grade cobalt, 1,750 t bismuth contained in metal ingots and oxide powder, and 265 t of copper.”

He states increase in cobalt consumption and the fact that approximately 65 per cent of mine production is currently sourced from the politically unstable Democratic Republic of the Congo, have raised concerns about the future supply of cobalt. NICO is planned to be an important new Canadian producer with supply chain transparency and uninterrupted custody from ore right through to the production of battery chemicals.

“If purchased for use in North America there would be lower transportation costs and trade advantages under NAFTA associated with Fortune’s cobalt production.

In addition, Chinese-produced cobalt chemicals are subject to Chinese VAT and excise duties in North America,” sates Nazarewicz.

However, Nazarewicz is realistic regarding NICO’s ability to supply Tesla’s demands, “market estimates are that Tesla will require 5,000 to 10,000 t/y of cobalt to meet its requirements for the first gigafactory in Nevada, whereas average annual production from NICO is 1,615 t. Consequently, three to six NICO-sized assets would be required to meet Tesla’s cobalt needs for the first gigafactory.”

Wherever it ends up coming from cobalt will be needed in abundance, he adds. “It is important to recognize that all major auto makers are working to build electric vehicles, plus new entrants such as Apple and Google and many proposed new manufacturers in China. At least 12 battery mega factories, including Tesla’s, have been either announced or are under construction to meet the expected increase in demand.” n

A Road Well Travelled

The Sahtu region gains all-weather highway

The Northwest Territories’ Sahtu region, situated west and north of Great Bear Lake, is especially diverse. In addition to its mineral wealth it encompasses boreal forest and mountains, as well as the Mackenzie River and Great Bear Lake. There are also five First Nations communities.

The Canadian government and the NWT have long recognized the advantages of a road through the Sahtu region.

The intended road is known as the Mackenzie Valley Highway (MVH) and would run for 800 kilometres from Wrigley to the Arctic Ocean subject to funding. In this respect, financial support from Canada’s National Infrastructure Fund, specifically set up to enable nationally significant projects, is a possibility.

At present, the Sahtu region is served by the Mackenzie Valley Winter Road, a vital route for crucial cargoes during winter. One problem on the winter road is the recent substantial increase in industrial traffic; all-weather access to the Mackenzie Valley and Arctic Coast would also mean access to minerals, metals, oil, gas, lakes, rivers, and hydro-electric power opportunities.

There are even sovereignty benefits as any all-weather connection as far as the Arctic Coast would demonstrate the importance of the region to Canada in general. Other advantages would include reduced reliability on air services.

The highway route Building of the road would be in phases – the northernmost section from Inuvik to Tuktoyaktuk is already under construction with completion scheduled for 2017. When all planned road construction in NWT, namely 1,000 kilometres of new roads, has been taken into consideration, access in the region could rise 50 per cent.

The highway is being pursued in sections. In addition to the Inuvik to Tuktoyaktuk Highway building, planning is underway to extend the highway from Wrigley to Norman Wells. Both projects support northerners' long-term vision for the NWT transportation system.

There will be no expansion of MVH (Highway 1) to Yellowknife because MVH already connects to Highway 3, which serves Yellowknife. NWT is working with the Tłįchǫ Government on an all-weather road to reduce the cost of living via year-round access to Whatì and more reliable access to Gamètì and Wekweètì.

The Inuvik-Tuktoyaktuk section of the MVH is currently entering its fourth winter season of construction and is being built with funding from the federal government and the GNWT. At the height of construction in 2015-2016, 509 people were employed.

Construction materials for MVH are transported using the existing road infrastructure, air and barges along the Macken2017

| Mining North of 60 65

zie River; contractors awarded the construction of the various

“We anticipate the highway will be built in the summer and

segments of the MVH will have to pay particular attention to

winter months and the contractor will need to adapt construc-

logistics and supply.

tion methods and techniques to the climate conditions,” she ex-

Ioana Spiridonica, manager, public affairs and communica-

plains. “The Inuvik to Tuktoyaktuk Highway is an example of the

tions, Department of Transportation, NWT, detailed the special

challenges that are often faced when developing infrastructure

demands of MVH.

in the north where low temperatures and permafrost are preva-

Proposed Future All-Weather Routes

L E G E N D

All-Weather Highways Mackenzie Highway Hay River Highway Yellowknife Highway Ingraham Trail Fort Smith Highway

66 Mining North of 60 | 2017

Fort Resolution Highway Liard Highway Dempster Highway Mackenzie Valley Highway Tłıcho˛ All-Weather Road

All-Weather Road into Slave Geological Corridor Ferries/Ice Crossings Public Winter Roads Private Winter Roads

Gateway Air Hub Regional Air Hubs Community Airports Marine Resupply Hubs Railway

lent. Since this section was constructed on continuous permafrost, it prompted developers to adapt their construction methods and techniques to these harsh climatic conditions."

Key to MVH, which is a ground-braking project, has been the years of research and analysis into the ways in which permafrost behaves. Each section of the road, with its unique features, has had to be studied for its unique features above and below the surface.

Full collaboration has also been necessary among engineers, contractors, and northern representatives with innovative techniques adopted to protect the permafrost. For example, there was rejection of the “cut and fill” techniques commonly used in the south because they cut into the protective layers of surface vegetation and organics with the possible results of a thawing in the permafrost below.

What did take place was the use of a special material known as Geotextile, a fabric placed between the existing ground and the construction materials along the entire highway. To further protect the permafrost, the bulk of construction activities have been scheduled to take place during the winter months.

The NWT’s government is committed to all communities affected by MVH. Partnerships with land claim groups, Aboriginal governments, and organizations have been established to manage the project descriptions devised for each section of the project region by region (Dehcho, the Tulita and K’ahsho Got’ine districts of the Sahtu, and Gwich’in Settlement Area). These descriptions include environmental considerations and an overview of terrain, vegetation, wildlife and archaeology.

Education for our North

“The NWT government continues to work with the federal government to secure the necessary funding for construction of the remaining sections of the MVH. NWT has submitted a business case for the Wrigley to Norman Wells section of the MVH to Infrastructure Canada. We are waiting for a formal response on it from the federal government,” states Spridonica.

“The current cost estimate for completion of MVH is expected to be $700 million. The project will go through a rigorous cost estimate prior to going through the procurement process and after the various bids are received.”

It is stressed by the NWT Government just how important it is to fulfill all the checks and balances that are involved when obtaining funding. This is in turn involves the implementation of sufficient research and analysis before commencing such large projects. NWT has a rigorous project management process in place that ensures that proper financial management is guaranteed prior to furthering developments and expenditures.

MVH is considered significant for NWT because building it will provide safe, secure, and reliable surface transportation access, contributing to many national and regionally significant benefits, including providing access to resources for exploration and development, as well as moving these to national and international markets. It will also create jobs for northerners, support economic growth, improve inter-community mobility, and enhance the resilience of NWT transportation in the face of climate change. n

Aurora College Educating Northerners for the Mining Industry • • • • • • •

Environmental Officers & Managers Skilled Tradespeople Underground and Surface Miners Finance Officers & Clerks Heavy Equipment Operators Administrative Managers & Assistants Supply & Project Management Professionals

For more information on our programs: www.auroracollege.nt.ca Email: info@auroracollege.nt.ca 2017

| Mining North of 60 67

Looking to the Future

Innovation and technologies for a new era of mining

By John Bianchini, chief executive officer, Hatch Global and industry forces are changing the world of mining as we know it. Mining companies are faced with new challenges, including heavy debt loads, oversupply of many commodities, and more complex, lower-grade ore bodies. Overlaying the traditional mining cycle is a new level of complexity. Society and business are being reshaped by rapid advances in technology, and stakeholder engagement has increased. Shifting public attitudes are moving us toward a more sustainable, lower-carbon future.

The mining industry has reached an inflection point. The days when cost-cutting alone could solve every problem are behind us. As an industry, we need to explore new ideas, including disruptive technologies and innovative business models. We need to change the way we think about mining, to adapt to unprecedented change and emerge stronger.

Modern mining In the future, mining companies will need to consider ways to create financial, social, and environmental value from mining projects. That means developing more innovative strategies that increase the

68 Mining North of 60 | 2017

value of mining operations, while identifying ways to create positive social and environmental outcomes. Today, that means converting challenges into opportunities.

A new energy approach at Glencore’s Raglan mine illustrates this. Raglan has set a new precedent for harvesting wind energy on an industrial scale in Canada’s North, while creating benefits for local Inuit communities. Working together with Hatch and implementing our unique Microgrid controller technology made it possible to bring stable, renewable power to a site that had been heavily reliant on diesel.

As an integrated team, Glencore, TUGLIQ Energy (owner of the wind turbine and storage system), and Hatch were able to overcome great challenges to make this remarkable project a reality.

Over the last decade, our engineers have developed and implemented more than 40 unique technologies that have given our clients a competitive advantage. Today, we are partnering with our clients to create, commercialize and implement technologies that tackle combinations of new challenges for their businesses and society.

At a time when many miners lack capital, one strategy is to support our clients

through operational readiness, asset management, commissioning, and startup. In other words, better operational support. At the same time, we see great potential in new digital breakthroughs and disruptive technologies that are bringing new value propositions to the market. Whether it’s drones, 7D BIM (building information modelling), or digital asset management, technologies will play a large role in the mines of the future.

However, some of the technologies being talked about today, when analyzed, have no direct connection to actual problem-solving or value creation.

It’s critical that the mining industry has a clear line of sight to those technologies that create real, measurable value and better business results. What’s needed is a compass to find our way – one that uses analytical, fact-based assessments to determine how applying specific technologies, tools, and business processes will add real value.

At Hatch, we’ve found that the best linkages between technologies and value are identified by assessing four key mining intensities: labour, energy and water, processes, and capital. This method evaluates the efficiency of mining processes and resources – the people and workplaces, equipment and production, and energy and water – per unit of product.

Using a value lens to analyze business and technical decisions will provide different answers than a cost analysis alone.

For example, an operation may cut staff, but if a fundamental change to technology hasn’t been made to compensate for this loss, the mine’s performance will decline. A value lens can also avoid decision-making that pushes economies of scale beyond the optimum level. So purchasing more super trucks may not be a good investment when considering the incremental costs of moving steel up and down ever-deeper mines and servicing these vehicles with ever-larger facilities.

We know that mining is a water-intensive industry and must be responsibly managed. To reduce water intensity, mineral processing flow sheets must minimize the amount of water that contacts the ore, keeping it as dry as possible, for as long as possible. This has benefits for tailings, water treatment and conservation, and reduces potential environmental contamination.

Smarter mining solutions Globally, the mining industry is moving toward several key enabling technologies that will help build the mine of the future. As technology integrators, we are working with our clients in several of the following key areas to help move the industry forward.

Technology Road Maps: In a digital age, the mining industry needs clear technology road maps that provide custom solutions. The goal is to create integrated, optimized, and appropriate technology solutions for each operation.

Electrification: Our clients’ vision is clean, safe, automated mines operating solely on electricity, at half the energy intensity of today. The benefits include a healthier, safer work environment, particularly for underground mines, less diesel, and reduced operating costs.

Electrification also lends itself to integrating renewable power into mine control systems.

Mine-to-Mill: From the very first fracturing of rock, operators can begin the process of increasing the value of the ore, rather than waiting until it reaches the mill. By using information about geology, minerals, and ore body characteristics, mining can be conducted in a way that makes removing impurities easier and delivers a more valuable end product, faster.

Mining Automation: Automating a mine makes the entire process leaner and more cost-effective. The automation of mining processes and software is a major focus for the industry right now, but is sometimes misunderstood.

When done right, the potential benefits can be anywhere from 10 to 40 per cent improvement in productivity.

New Mine Financing: In the future, the industry will need to find cheaper ways

to mine and reduce capital intensity. As financial markets take an increasingly dim view of the risks associated with mega projects, alternative ways to attract investment will become necessary. This may mean reconfiguring aspects of mining projects to appeal to different classes and types of investors, from the high-tech investor to those willing to invest in a project’s infrastructure requirements.

Despite current market conditions, there are good reasons for the mining industry to be optimistic. Bold, new ideas are challenging the status quo. More and

more mining companies are looking to smarter, more innovative solutions to overcome today’s challenges. Mining companies and their leaders are becoming more empowered to redefine the way they operate. As this transformation takes place, we’ll need to keep our focus on solutions that deliver real value to the industry, our stakeholders, and a rapidly-changing environment. n This article previously appeared in the August 2016 edition of Canadian Mining Journal.

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| Mining North of 60 69

All the Carats

Applied Diamond Services for improved grade prediction and recovery

By Steven Creighton, Lucy Hunt, and Jane Danoczi

The Saskatchewan Research Council’s (SRC) Geoanalytical Diamond Services Laboratory is internationally recognized for secure and reliable micro- and macro-diamond recovery. The lab has consistently been at the forefront in developing and applying innovative solutions in the diamond exploration industry. The new expertise and laboratory enhancements of SRC’s Applied Diamond Services builds on the company’s commitment to excellence and its reputation for top-quality data production. New services include diamond typing, breakage assessment, ore and gangue characterization, as well as assistance in integrating these data for grade prediction for developing deposits and improvements to diamond recovery circuits in existing mines.

Diamond typing Natural diamonds commonly include nitrogen – an impurity that has important implications for diamond recovery. The convention is to divide diamonds into two main types based on the occurrence and state of their nitrogen impurities using fourier-transform infrared spectroscopy (FT-IR). Type Ia diamonds have nitrogen atoms in mixed paired arrangements in the diamond and Type II diamonds, comprising two percent of natural diamonds, do not contain measurable nitrogen.

Restricted availability of FT-IR equipment has limited the commercial application of diamond typing. The Applied Diamond Services team has automated FT-IR data collection and interpretation applicable not only to macro-diamonds, but also to micro-diamonds as small as 75 μm. The automation significantly reduces the cost per analysis and makes diamond typing cost-effective for large diamond collections.

Typing diamond populations adds information that is useful for improved grade predictions and kimberlite prioritization by predicting the occurrence of large diamonds. The occurrence of Type II gem diamonds that are greater than 100 carats is disproportionately larger than would be expected from their natural abundance in smaller sizes. The per-carat price of these large Type II diamonds can exceed US$15,000, therefore, their presence can significantly increase the value of a kimberlite. The potential occurrence of large Type II diamonds can be predicted from the size-frequency distribution of Type II micro- and macro-diamonds using FT-IR analysis available through SRC’s Applied Diamond Services.

Diamond breakage Diamond breakage has an obvious negative impact on the apparent economic value of a kimberlite. Models of diamond distribution data are used to predict the occurrence of diamonds larger than those observed in the physical samples. Small fragments broken off of large diamonds, however, can artificially inflate the proportion of micro-diamonds skewing the modelled distribution to smaller sizes, resulting in an inaccurate underestimate of the occurrence of larger diamonds. Therefore, it is important to assess the amount of breakage that has occurred in order to more accurately predict the potential occurrence of large diamonds.

Diamond breakage studies require visual analysis of the recovered diamonds to identify any that may be broken. The broken diamonds are inspect-

70 Mining North of 60 | 2017

PHOTO COURTESY OF THE SASKATCHEWAN RESEARCH COUNCIL.

ed by an experienced specialist who will determine whether the breakage occurred naturally or as a result of exploration and mining activities (e.g., drilling, blasting, crushing, and extraction). The original diamond volume is estimated from the morphology of the remaining fragments and included in a reconstructed size-frequency model. With the model corrected, the size distribution can be extrapolated to determine the largest single diamond expected from a 1,000-tonne and 10,000-tonne sample â&#x20AC;&#x201D; the so-called 1kt and 10kt values. Breakage studies conducted by the Applied Diamond Services team have shown that the reconstructed size-frequency distribution often significantly increases the 10kt value.

Fluorescence measurements Diamonds are primarily recovered from a dense medium concentrate using X-ray sorting techniques. This recovery method relies on the observation that most natural diamonds emit visible light when excited by X-ray radiation (fluorescence). The fluorescence intensity and diamond colour is related to defects that occur in the crystal lattice, most commonly as a result of nitrogen incorporation. For diamond recovery, a thin layer of concentrate is passed through an intense beam of X-rays and when fluorescence is detected, a jet of compressed air deflects the diamond to a secure recovery bin.

There are a few factors that complicate X-ray recovery. One is the occurrence of non-fluorescing diamonds. It is well-known that Type II diamonds typically do not fluoresce and have to be recovered using alternative methods. Recent work by the Applied Diamond Services team suggests that some Type Ia diamonds may also not be recoverable using X-ray recovery methods.

Possible reasons for poor Type Ia recovery include weak or no fluorescence as a result of fluid or mineral inclusions, fibrous coatings or poor liberation (kimberlite adhering to the surface of the diamond). Alternatively, a Type Ia diamond may have normal fluorescence intensity, but have a slow rise-time response resulting in the diamond passing the point of recovery before the photodetector has a strong enough signal to trigger the air jet.

A second complicating factor is the presence of fluorescing gangue minerals from the country rock. Granitic and sedimentary host rocks contain fluorescent minerals such as feldspar, apatite, zircon and dolomite. Most of these minerals are removed in the early stages of processing, but some of these minerals inevitably reach the X-ray sorting stage. X-ray spectroscopic measurements of diamonds and gangue minerals are essential for ideal diamond recovery. The Applied Diamond Serviceâ&#x20AC;&#x2122;s X-ray spectroscopy studies include characterizing both diamonds and gangue minerals in terms of fluorescence intensity and rise time. These parameters should be determined when there are changes in the kimberlite mineralogy or host rock facies in order to tune X-ray recovery machines for maximum recovery.

Applied Diamond Services SRCâ&#x20AC;&#x2122;s Applied Diamond Services adds a considerable suite of new services that will help diamond companies improve grade prediction, target selection and optimize recovery plant processes. Typing of micro- and macrodiamonds by FTIR grade is being used to develop grade prediction models to increase the probability of finding diamonds great than 100 carats. Breakage studies help with predicting the largest single diamond per volume of kimberlite processed (10kt value). Fluorescence characterization of diamonds and gangue minerals is essential for optimizing X-ray recovery machines to maximize diamond recovery. The Applied Diamond Services team is ready to apply these new services to improve diamond operations at any stage of deposit development. n 2017

| Mining North of 60 71

Mining Cargo

An accurate loading and stowage plan maximizes sealift cost efficiency

By Waguih Rayes The remoteness and isolation of mining sites in the Canadian Arctic result in relatively high construction and operating costs. A big chunk of these costs goes to

72 Mining North of 60 | 2017

the transportation of heavy equipment and prefabricated structures, as well as the supplies and material that mines have to bring in by sealift. Maximizing

the use of available cargo space onboard sealift vessels is therefore a must for optimizing transportation cost efficiency and reducing the overall landed cost of project construction and resupply operations.

One of the most important ways to ensure sealift cost efficiency is to meticulously prepare and implement a ship loading and stowage plan. Preparing the plan is usually the responsibility of the cargo operator. Once finalized, the plan is submitted to the shipâ&#x20AC;&#x2122;s master for approval prior to the start of loading operations.

Mariners and people in the maritime trade know that loading and stowage plans must comply with international regulations pertaining to the segregation of cargo, mainly with respect to dangerous goods (IMDG). In Canada, certain Transport Canada (TC) regulations must also be observed.

At DesgagnĂŠs Transarctik Inc. (DTI), cargo operations for each Nunavut Sealink and Supply Inc. (NSSI) customer in the mining industry are overseen by a fully-qualified Arctic operations superintendent, who monitors every step

SEDNA DESGAGNÉS

Capitaine :_______________________

MODULE

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7 X BUCKETS

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PILLING #58 6 BDL 11 X BDL TUYAUX ISOLÉ

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WACKER GEN. IN BOX #135

GEN. IN BOX

USINE EG-10 # 95 32T

RAN 40' RAN RAN 40' RAN RAN 40' RAN RAN 40' RAN RAN 40' RAN RAN 40' RAN RAN 40' RAN

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ARTICULE CAT AD30 ##5 65 33T 33T

AUTOBUS JAUNE 13T

ARTICULE CAT 740 # 65 33T

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BÉTONNIÈRE 12 #93 16T BÉTONNIÈRE 12 #93 16T

LOADER 938 # 91 16T

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MÉCANIC TRUCK F-550 #63

BÉTONNIÈRE 10 #92 16T

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approuved by: ___________________

of each operation until cargo discharge at destination is complete. Superintendents are usually career mariners who have acquired extensive cargo management expertise and loading and stowing experience over their years of service.

The majority of loading and stowage plans that DTI prepares for mining industry customers are produced and/or reviewed by a superintendent.

Layouts of each cargo ship owned and managed by Desgagnés are plotted with precision into a software program the company uses to produce the plans.

The accuracy of the program helps maximize the usage of stowage space without exceeding the ship's cargo capacity.

Accurate plans are also essential for ship stability and are important for maintaining safety during offloading operations and cargo discharge at destination.

Preliminary loading and stowage plans are initiated on the basis of cargo information provided by the customer.

Cargo lists containing information such as the description, volume, and weight of each cargo unit are transmitted in a timely manner to the carrier early in the operations planning process. This means that mine managers have to

think ahead, planning well in advance of the sealift navigation season.

With help from customer service at NSSI, DTI's operations manager regularly updates the cargo lists until the cut-off date for delivery to the dock is reached.

The preliminary loading and stowage plan is periodically adjusted to take the updates into account, and the final plan is produced shortly after the cut-off date.

Of course, project managers have their share of challenges to deal with. In some cases, major delays in transmitting information can put planned cargo operations at risk. That’s why mine managers need to be aware of the constraints carriers face when critical information on the cargo is delayed.

More importantly, in the case of dangerous goods, loading and stowage plans must take into account segregation requirements. Stowage space could be wasted if the information provided by the client is not timely and accurate.

Last-minute additions of extra quantities or certain types or classes of dangerous goods, affect stowing efficiency due to segregation restrictions. Regrettably, such situations often lead to valuable stowage space going unused. In other instances,

wasted stowage space results from inaccurate measurements and weight information. This is a common problem with dimensional cargo, prefabricated structures, camp units and other similar freight.

Planning a sealift season requires an early start - sometimes as early as January or February - to evaluate tonnage requirements, ensure vessel availability, and plan the voyages to be carried out. By getting an early start and providing regular and accurate updates, customers help optimize sealift performance and achieve, or even surpass, the transportation cost efficiencies they are aiming for.

Maintaining good, timely communications from the outset enhances the efficiency of ship loading and stowage planning and operations in general. This in turn leads to cost efficiencies and customer satisfaction. n Waguih Rayes is general manager of Desgagnés Transarctik Inc., managing partner of Nunavut Sealink and Supply Inc. (NSSI), the most active sealift carrier in Nunavut.

2017

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Approuvé par : ___________________

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CONT ORDINAIRE MC ÉQUIPEMENT 0000MC GÉNÉRAL 0000MC MODULES 0000MC ÉQUIPEMENT DTI 0000MC REFFER 40' 0000MC FLAT RACK 20' 0000MC CONT BAKER LAKE 0000MC CONT 40' MÉLIADINE 0000MC CONT DANGEREUX RAN DESTINATION 0000MC DESTINATION 0000MC DESTINATION 0000MC DESTINATION 0000MC DESTINATION 0000MC Volume total : Tonnage total :

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Début du chargement : 25 Sept 2016 Fin du chargement : 28 Sept 2016 Numéro de voyage : 03 ETD : 28 Sept 2016 Départ : 28 Sept 2016

STEEL PIPES

PLAN DE CHARGEMENT 28 sept 2016 Final

| Mining North of 60 73

At the Top

TerraX Minerals’ Yellowknife City Gold Project is poised to become one of Canada’s largest gold camps TerraX Minerals focuses its operations on the Yellowknife City Gold Project (YCG). As its name implies it is located near the capital of the Northwest Territories - Yellowknife. Owning YCG means that TerraX now controls one of Canada’s six major highgrade gold camps with recent drill results indicating a worldclass gold district.

In addition to the sheer size of YCG, its situation of 15 kilometres from Yellowknife means it’s close to vital infrastructure, including transportation, service providers, hydro-electric power, and skilled trades. The mine is accessible year round by road, with Yellowknife airport very close. As TerraX President, CEO, and Director Joe Campbell points out, “The Yellowknife airport provides TerraX excellent access across the rest of Canada which greatly simplifies our logistics and reduces our operating costs. In addition TerraX's core facility is on airport property.”

In geological terms, there are considerable differences between YCG’s properties to the north and to the south of Yellowknife. To the north, the properties lie in mafic to felsic volcanic sediments and granites, but to the south in dominantly mafic volcanics. The latter constitute a thin crescent along the shore of the Great Slave Lake and include the city of Yellowknife itself.

The YCG’s total area 129 square kilometres lies on the Yellowstone greenstone belt. Within that area lie 23 kilometres of strike length on northern (15 kilometres) and southern (eight kilometres) extensions of a shear system that previously hosted the Con and Giant high-grade gold mines.

Exploration at YCG July 2016 saw TerraX raise $7.5 million over and above $3.2 million in May 2016. This means the company is fully funded for exploration work right through 2017.

In the last year, successes have included discovering new high-grade intercepts of 8.0 metres at 60.60 g/t Au, and 7.30 metres at 23.60 g/t Au at the Mispickel target. Near-surface mineralization has also brought success at the Sam Otto target,

Parts Sales Service

867-668- 2127

227 Range Road, Whitehorse YT 74 Mining North of 60 | 2017

with drill intercepts of 49.70 metres at 1.00 g/t Au, and 30.70 metres at 1.33 g/t Au. “No cut-off grade has yet been established as this would require mine planning and economic studies which haven't been done yet. A cut-off grade (or point) is an estimate of how much gold is required in the rock to economically extract it. Cut-off can be highly variable for each project depending on mine size, capital costs, and mining and processing methods. These have not been determined yet,” explains Campbell.

At the time of writing, TerraX had just revealed the results of its summer 2016 drilling program, centred on a 10 kilometre by four kilometre core gold area and totalling 27,000 metres.

Drilling commenced in July 2016, and was completed near the end of October with over 10,000 metres drilled in 36 holes, but will restart again in January of 2017.

Specific properties YCG comprises several areas of activity. For example, the 3,562-hectare Northbelt property was wholly acquired by TerraX in 2013 in a bankruptcy sale. Northbelt covers 13 kilometres of strike and is the northern continuation of the shears that hosted the Con and Giant workings.

Since then, TerraX has expanded the Northbelt area to take in a number of other properties: Goodwin, Ryan Lake, Walsh Lake, and U-Breccia. These four, along with other contiguous lands, have expanded YCG and have solidified its control of one of the top six Canadian gold camps.

Within Northbelt, TerraX has identified many very promising targets for the future. Targets in Northbelt’s central and southern sections host many gold-bearing shears spread over a wide range of targets. A second opportunity is an excellent zinc and lead base-metals target at Homer Lake, which also contains promising gold and silver values.

To the east of Northbelt, TerraX has entered into an agreement with a local prospector, Walt Humphries, whereby it could acquire the whole of the Walsh Lake property with seven leases and five claims over 26.95 kilometres. An additional plot east of Walsh Lake has been acquired from Walt Humphries.

TerraX has also turned its attention to the local communities.

“In respect of CSR we have signed no formal agreements, but our permit to work from the Mackenzie Valley Land and Water Board and our internal policies require us to carry out our work in a manner that causes minimal disturbance to aboriginal and recreational users of our ground, and to use as much local labour, services and supplies as possible to maximize the benefit to the citizens of the NWT,” explains Campbell.

An ambitious series of acquisitions in conjunction with encouraging drilling results over the full extent of YCG mean that TerraX is well placed to exploit its position in one of Canada’s six largest gold camps. n

TerraX Minerals Inc. 2300-1066 West Hastings Street Vancouver, BC V6E 3X2 Phone: (604) 689-1749

www.terraxminerals.com 2017

| Mining North of 60 75

A Major Step Forward

Copper North’s Carmacks Copper-Gold-Silver Project is positioned to be Canada’s next new copper mine Copper North’s flagship project, the Carmacks Copper-GoldSilver Project, is located approximately 30 kilometres off the Klondike Highway near Carmacks, Yukon. The Carmacks project is in the southern portion of an evolving copper-gold district that extends northwest to the Dawson gold fields. Copper was discovered in 1970s, and the mineral deposit has since been through several exploration and development programs.

The Carmacks deposit is somewhat unique as it is the only large oxide copper deposit in Canada, a feature resulting from avoidance of glaciation. The deep weathering of the sulphide mineralization has left a residue of copper, gold, and silver mineralization that is readily leached to produce copper cathode that can be sent directly to copper fabricators. These oxide copper deposits typically are processed using sulphuric acid heap leaching. But the Carmacks ore also has relatively high gold and silver grades, which are not recovered with acidic leaching. Recovery of both the copper and the precious metals requires two very different metallurgical processes – acid leaching for the copper and cyanide leaching for the gold and silver.

For most of the history of the Carmacks project, the focus was only on copper recovery. With the new management in early 2014, all aspects of the project were examined to look at ways of improving project economics and operations at this northern site. Addition of gold and silver recovery was identified as a critical part of the project improvement plan, so Copper North decided to re-engineer the process to add gold and silver recovery, alongside the leaching of copper. With the reengineering by JDS and others, the processing plan evolved into an efficient plant and reduced operational and environmental risk. The new plan was announced October 12, 2016, confirming a very viable new mine opportunity for the Yukon.

Overcoming hurdles The project review in March 2014, identified several hurdles to be overcome in project improvement in addition to precious metals recovery including expansion of mineral resources, addressing winter operating conditions, and reduction of capex and opex costs.

The last copper-only feasibility study completed in 2012 involved mining and crushing the oxide copper ore, placement on a large leach pad, irrigation with sulphuric acid to leach the copper, collection of the copper bearing (pregnant) solution, and extraction of the copper by electrolysis to make cathode copper sheets. Operation of the heap leach pad in winter conditions introduced operational and engineering challenges.

The cold conditions resulted in a very long leach time for copper recovery and it was unlikely that any subsequent gold and silver recovery from the heap would be successful.

The new leach plan overcomes these operational hurdles and included recovery of gold and silver and provided an op-

76 Mining North of 60 | 2017

portunity to increase gross revenues by approximately 30 per cent.

Evaluation of leach alternatives The value of adding gold and silver recovery to the project was determined in a Preliminary Economic Assessment (PEA) released in June 2014. That initial PEA used a two-stage heap leach process involving copper recovery on an on/off leach pad, followed by rinsing and neutralization of the ore and placement on a second pad for recovery of gold and silver. The addition gold and silver recovery resulted in a C1 cash cost of US$1.07/lb compared to a C1 cash cost of US$1.65/lb copper for leaching copper only. With the confirmation of improved economics with addition of gold and silver recovery, the team evaluated alternative leach systems to improve recoveries, reduce capital and operating costs and minimize operational and environmental risks.

Agitated tank leach improves processing copper Metallurgical test work to develop a new leach plan commenced in fall 2014. Initial evaluation focused on vat leaching, which reduced the copper leaching time from over 200 days to about 25 days. Despite these substantial reductions of leaching time, vat leaching still involved considerable material handling and the handling of large quantities of wet material in winter remained an operational concern. The addition of a grinding step to ore preparation after three stage crushing, reducing the size of material from approximately six millimetres to about 0.7 millimetres, produced further substantial reduction of leaching times, copper to less than a day and gold to less than two days.

In addition to the rapid leaching, this much smaller particle size allowed the process to move to agitated tank leaching, which greatly simplified material handling, allowing pumping of the slurry, particularly under winter conditions. All subsequent test work then focused on agitated tank leaching.

Heating of the copper leach tanks to 80 degrees Celsius resulted in the optimal copper recovery of 85.5 per cent, recovering 99.4 per cent of the acid soluble copper in the ore in just four hours of leaching. During operation, the copper leach tanks will be heated using waste heat from the acid plant that will be used to produce sulphuric acid on site so no additional energy is required. Further work centred on the ore preparation. Initially, the ore preparation involved three stage crushing followed by grinding using a rod mill. Replacing the rod mill with a SAG mill allowed us to eliminate the secondary and tertiary crushing stages, reducing both capex and operation costs.

Leach time for copper is efficient, taking about four hours.

The leach circuit is now a closed circuit. Leached copper is recovered from solution by solvent extraction followed by electrowinning to produce copper. The containment minimizes the

risk of breaches of the leach materials and reduces environmental risks.

Gold and silver agitated tank leach After removal of all acid and soluble copper, the ore slurry is neutralized using lime and then is pumped into the cyanide circuit to recover gold and silver. The test work confirmed similar fast leaching of less than 16 hours and improved gold recoveries. After evaluation of the Merrill Crowe method, the CarbonIn-Leach (CIL) process was selected to produce gold-silver doré.

The twice-leached ore residue goes through a cyanide destruction circuit to remove cyanide from the residue before it leaves the process plant. The residue is then dewatered and trucked to the tailings management area where it will be spread and compacted. This dry stacked tailings management is considered Best Available Technology, eliminating the concerns associated with conventional wet tailings management and addresses many of the concerns of waste disposal, common at mining projects.

Environmental performance Key points with the new agitated tank leach are many: reduced footprint of the process plant and mine, elimination of potential for a failed heap, there levels of containment of copper and gold leach circuit, all leach residue pass through cyanide destruction circuit before storage, and fluids return to circuit. The application of dry stacked storage leads to simpli-

fied project closure and progressive reclamation. This series of operations reduce operating and environmental risks and provides overall savings.

Copper North is particularly pleased by the much improved operational efficiency and control, and are confident regulators, First Nations, and other interested parties will approve of the changes being proposed.

Mine economics, our Work Is Not Yet Done The new PEA, was undertaken by JDS Energy and Mining Inc. and completed in October 2016. JDS, together with a group of consultants, confirm the details of the new efficient leach plan and an approximate 33 per cent increase in gross revenues due to silver and gold recovery.

The new capex, sustaining capital and contingency for the copper-gold-silver leach plan totals CDN$263M, slightly less than the capex in the 2012 heap leach plan for copper only.

The new leach plan requires more process equipment than a heap leach operation. However, elimination of a standard heap leach pad reduced capex by $75million in the new plan.

Operating cost increased slightly but was largely offset by improved recoveries of copper and gold.

Assuming Consensus Pricing for projects in the development pipeline, of US$2.75/lb for copper, US$1300/oz gold, and US$17.50/ oz silver, the project economics of CAD $59M Pre-tax Net Present Value and CAD 14.2 per cent Pre-tax Internal Rate of Return.

Although respectable it is apparent that there are additional opportunities to achieve further improvements. A plan is in progress

220 KM NORTH OF WHITEHORSE, YUKON - 400 KM FROM YEAR-ROUND PORT AT SKAGWAY, AK

ADVANCING CARMACKS COPPER-GOLD DEPOSIT TO BE THE YUKON’S NEXT COPPER MINE COPPER NORTH

MINING CORP.

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| Mining North of 60 77

to address these opportunities. The most important objective is to increase the mine life as each year of operations produces approximately $50M net gross revenues to the cash flow model. Mine life expansion significantly increases NPV and IRR.

Carmacks is bigger than most people think After dormancy of exploration since 2008, Copper North took on the challenge of expanding mineral resources. The modest program in fall 2014 focused on Zone 2, well to the north of the main zone. The drilling extended the small deposit to a mineralized zone having a length of over 500 metres. Additional drilling is warranted to bring the Zone 2 mineralization into the mineral resource inventory.

The 2015 exploration program was expanded to $1M, to better understand controls of mineralization and undertaking fillin drilling of mineral zones south of the main deposit proposed to mine. Drilling was focused on a 2,000-metre-long mineralized zone, interpreted as the south extension.

The summer drill program indicated that the copper mineralization was continuous over the 2,000-metre-long target zone to the south of the main zone mineralization. Success of the summer program, lead to a fall drilling program; filling-in drill spacing and expanding the boundaries of the new mineral zones.

Mineral Resource Expansion The January 2016, Mineral Resource Report indicated that the mineral resources in all categories nearly doubled historic measured and indicated mineral resource of 12 million tonnes

This is our backyard...

grading 1.07 per cent copper, 0.456 g/t silver, and 4.58 g/t silver. The new 2016 PEA is based on the historic mineral resource. Copper North plans additional definition drilling and mine engineering work to bring the new mineral resources into the mine plan , with an initial target of adding three years to the mine life. This drilling will largely be focused on the 3.9 M tonne measured and indicated mineral resource and 0.8M tonnes of inferred resource that were confirmed in the January 2016 Mineral Resource.

Also of interest is the large increase in sulphide mineral resource that extends to depth below the various oxide copper zones. The sulphide mineral resource, and potential for further expansion as exploration resumes, provides a potential for much extended mine life. Carmacks is bigger than most people think and much exploration is warranted.

Building on the progress of 2016 The announcement of a substantial increase in mineral resources and the completion of a new PEA in October 2016 have set a base for the final round of engineering to resume permitting and securing project financing. Key to reaching our objectives is the expansion of mine life to strengthen project economics. While this final work plan is being completed, it is widely expected that copper prices will begin their recovery to meet the needs of growing copper consumption.

The low production cost and opportunity for mine expansion, positions Carmacks Project to be the next new copper mine in Canada. n

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