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The Mining Report: Expand Your Mine, Man

The Mining Report: Expand Your Mine, Man

Life or death decisions at Ekati and Meadowbank
By Herb Mathisen
Nov 09
From the November 2015 Issue

It’s a race against time for Dominion Diamonds in the NWT and Agnico Eagle in Nunavut. The finite reserves at the Ekati diamond and Meadowbank gold mines are starting to run low, and both companies are pushing to expand into new pipes and pits to keep the mills and drills running, their many hundreds of workers employed and the cash flowing in. Here’s the scoop:

Dominon’s Ekati:

Why?  The NWT’s first diamond mine has had a very nice run, but without any expansion, its mine life is set to end in 2020.

Expand where? To the Jay Pipe, under Lac du Sauvage, roughly 30 kilometres southeast of Ekati’s mining facilities. Based on a pre-feasibility study released in January, the new kimberlite contains an estimated 84.6 million carats and would extend production at Ekati by 11 more years. The new development, which would include draining a portion of the lake and erecting containment dikes around it, will cost nearly US$700 million to build. Construction is expected to take three to four years, which means there’s barely enough time to squeeze in a smooth transition to Jay—except that there’s one more step before construction starts…

What's next? Permitting. In September, Ekati held public hearings in Yellowknife and around the NWT to discuss its plans, allowing citizens, communities and governments input and a chance to raise concerns about potential impacts on caribou and the environment. At the same time, Ekati released a preliminary economic assessment on the fully permitted Sable project—nine million carats, US $147 million to build. That, paired with some added underground mining, Dominion hopes, will give it a little more flexibility to bring the Jay Pipe on line.

Courtesy Dominion/Dave Brosha

Agnico’s Meadowbank:

Why? Earlier this year, Agnico Eagle’s first foray into gold mining in Nunavut, the Meadowbank mine outside Baker Lake, had only two years left, with closure planned for the third quarter of 2017. 

Expand where? The Vault Pit. And then eventually Amaruq, its next big thing. Extending its Vault open pit should add another year to Meadowbank’s mine life. This would require draining and fishing out the abutting Phaser Lake. Yet this still only takes Meadowbank to Q3 2018, likely creating a gap of one year between the exhaustion of Meadowbank’s gold and the start of Amaruq, which continues to turn in high-grade results.

What's next? The Vault Pit extension plans are under consideration of the Nunavut Impact Review Board right now. As for Amaruq, Agnico continues to drill it and is pursuing a permit to build an all-weather road there from Meadowbank, roughly 50 kilometres to the southeast. Though no development decisions have been made about Amaruq, its proximity and similarities in mining style to Meadowbank mean that equipment and labour from the current mine could easily transition to the promising new deposit.