MINTO MINE
It’s the great bronze hope.
The Minto copper mine, the first hardrock mine developed in the Yukon in 10 years, is being touted as the model for a new era of mining in the post-settlement, boom-economy state of the territory.
“The Yukon is back in business,” said Ian Berzins, the mine’s general manager, during a tour of the mine on Thursday.
Throughout the day, Sherwood Copper flew in three planeloads of government officials, politicians, Selkirk First Nation members, and anyone conceivably involved in the construction, financing and development of the $100-million project, which is located 250 kilometres north of Whitehorse.
After circling the minesite in an airplane — a view that made the large, layered pit look like the Roman Coliseum — and landing on the snow-packed airstrip, dignitaries donned blue hard hats and safety glasses for a tour of the pit and the mill operation.
Nearly 125 people, including on-site mine employees, filed into a large storage building, usually filled with sacks of copper concentrate ready for shipment to smelters in Asia, for the official opening of the mine.
Like a proud papa handing out cigars in a maternity ward waiting room, a grinning Stephen Quin, Sherwood Copper CEO and president, explained the complex and tenuous deals with financiers and the fast-and-loose operations that got the mine up and running.
“We were pouring cement as soon as we got the diagrams,” said Quin.
“Sometimes we poured it two or three days before we got any plans, but we didn’t have to dig it back up too many times.”
Two companies originally staked competing claims at the site in 1973.
The split ownership and plunging metal prices forced the mine into obscurity until interest was rekindled in the mid-1990s when the mine’s then-owners pushed for consolidation of the property.
Again, development was dropped when metals prices plummeted.
A deal between all the companies that had interests in the property was made by Sherwood Copper, including a successful $7-million bid that came far below the $22-million asking price.
The small mining company then pushed for fast development to cash in on rising commodity prices.
Only two years after acquiring the property, the mine started to produce copper.
“There’s probably nothing else in the mining industry that has gone from a stand still to full production in two years,” said Quin.
The mine has been pulling copper out of the large open pit since June.
On average, the mine processes 1,500 tonnes of raw copper every day, producing 130 tonnes of concentrate.
A $16-million mill expansion underway is expected to add another 900 tonnes per day once it is completed in December.
To date, the mine has shipped nearly 6,000 tonnes of copper concentrate to Skagway, where it’s then sold and shipped to smelters in Asia.
Mine officials throughout Thursday’s tour boasted the copper at Minto Mine is some of the highest quality in the world.
The high grade — 2.4 per cent compared to the world average of about 0.4 per cent — combined with the mine’s relativity small size and low-cost production makes for a strong operation in the face of future copper price fluctuations, said Mike Burke, a geologist with the Yukon Geological Survey.
“It’s a stable operation,” he said.
“Compared to other copper mines, it’s in the lower 25 per cent of cost production. If it’s producing, that means if the market goes down, it’ll remain open because of the low cost.”
Officials originally pegged the mine’s shelf life at about seven years, but recent explorations of the immediate area have pushed that estimate higher.
Long-term production would do much to help the Selkirk First Nation, which owns the land Minto mine sits on, said Jean Van Bibber, a Selkirk councillor.
The First Nation has an agreement with the Yukon government and Sherwood Copper that provides employment opportunities and revenue from the operation.
Of the roughly 100 employees at Minto, 50 per cent are from the territory, said Berzins.
“This is the beginning of a partnership and there’s tremendous room for improvement,” said Van Bibber. “We’re still talking about the obligations of our partnership.”
Selkirk First Nation could receive royalties of “millions of dollars annually” from the mine, said Energy, Mines and Resources minister Archie Lang.
The government also agreed to assist the First Nation with any positive or negative effects of the mine, taking Selkirk off the hook for any clean-up costs.
With this summer’s announcement that it will take $750 million for the initial clean up of the Faro lead-zinc-silver mine and an additional $2- to $4 million annually for 500 years just to hold back more environmental damage, people are already questioning what will happen when Minto closes, no matter how far that is in the future.
“(Minto) is a modern mine and Faro was last generation,” said Lang. “The money is in place to guarantee reclamation will be done.”
Sherwood Copper has put $3.7 million towards the mine’s reclamation and closure plan, which lays out what environmental work is required when the mine closes.
The company pays rolling security deposits and the plan is reviewed every two years, at which point the government could ask the mine to provide more money.
Waste material hauled away and piled up around the mine site is not toxic, curtailing any environmental damage and making it easier to reclaim the land when the mine closes, said Burke.
“The impact on the environment is minimal because there is no acidic material in the waste, unlike Faro,” he said.
At the ribbon cutting ceremony that officially opened the mine, Lang announced the Yukon Energy Corporation has approved construction of the Carmacks-Pelly Crossing transmission line, which includes a spur line to the Minto mine.
The mine is contributing $11 million to the extension, which is still subject to several approval processes.
Copper was trading at $3.65 (US) per pound Friday morning.