zinifex to help build arctic port

NORTHERN DEVELOPMENT
TheStar.com - Business - Arctic port plan gathers steam
Arctic port plan gathers steam

New harbour operation and all-weather road would provide `the building blocks for Canada's next great mining district,' Sabina Silver president says
Jul 04, 2007 04:30 AM
Bob Weber
Canadian Press

A languishing plan to build a deep-water Arctic port has been reinvigorated by rising commodity prices, and six mining companies, including at least two of the world's largest, are willing to help pay the shot to move the project ahead.

"It's certainly keeping it alive," said Charlie Lyall, president of Kitikmeot Corp., an Inuit-owned group that originally filed a proposal to build the port in 2002. "I'm much more hopeful today than I was a year ago."

Lyall's group wants to build the port and road at Bathurst Inlet, a deep cleft in Canada's central Arctic coastline. Lyall said Kitikmeot is in talks with private lenders to finance part of the project.

The port would be capable of handling 25,000-tonne ice-class vessels. The facility would include a 1,200-metre airstrip and, most importantly for the backers, a 211-kilometre all-weather road south into some of the richest mineral territory in Canada.

That road would end in the neighbourhood of at least seven mines that are already operating, under construction or in advanced planning, which explains why the miners are largely financing the project's environmental impact assessment.

"We're looking at (the port and road) as a key piece of our logistical puzzle," said Abraham Drost, president of Sabina Silver, which owns a 47 million-tonne deposit of silver, zinc, lead, copper and gold at Hackett River, about 75 kilometres from the proposed port.

The road and port are the only feasible ways to bring in supplies and remove ore concentrate from such deposits.

Zinifex Ltd., which owns a massive copper-zinc deposit at Izok Lake, is in the same boat.

"It's vital," said company official Ewan Downie. "Without this transportation infrastructure, the project will not proceed."

The area's diamond miners, such as Rio Tinto Inc., are also backing the port's environmental study.

They currently truck in supplies on an ice road from Yellowknife and fly out production, but climate change has put the future of the road in doubt. Trucking supplies down an all-weather road would be much cheaper than flying them in, and the port is one of several alternatives the diamond miners are considering.

The port and road are expected to cost about $135 million.

A 2002 federal report estimated that the expenditure, combined with the mining development that would be encouraged, would bring a total of $925 million in investment to Nunavut and create an average of 1,400 direct and indirect jobs a year.

As demand from the emerging economies of China and India drives commodity prices to new levels, Canada has a chance to cash in, said Drost.

"Nunavut is putting in place the building blocks for Canada's next great mining district," he said.

Other miners in the area include Miramar Mining, Dundee Precious Metals, BHP Billiton and DeBeers.

Lyall, who said the port's environmental study will be filed in the fall, thinks the project merits federal support.

"We're hoping to convince the government to take part in that as a private-public partnership."

Prime Minister Stephen Harper's government has said it plans to place more emphasis on northern development.