TMAC Resources Ltd. is touring western Nunavut this week

By JANE GEORGE

The new owners of the Hope Bay gold mine project in western Nunavut say they’re eager to introduce themselves to people in the Kitikmeot region.

That’s why representatives from TMAC Resources Ltd. plan to spend this week touring through the region’s communities, where TMAC’s Catherine Farrow is urging everyone to “come and meet us.”

This month TMAC announced it had completed the acquisition of the mothballed Hope Bay project from Newmont Mining Corp. and closed $50 million in financing.

Under the deal, Newmont now becomes a major shareholder in TMAC, which the mining giant viewed as the best vehicle for moving Hope Bay into production.

For now, Farrow said TMAC is still in the planning stages with a limited budget of about $42 million (with about $8 million of its $50 million already taken up in trust for remediation of the future mine)

When you think that Newmont mining sunk more than $2 billion into Hope Bay, you can see that’s not a lot of cash to develop a mine.

Farrow told Nunatsiaq News that, over the short-term, TMAC plans to make an inventory of what Newmont left at the Doris North site, the hub of above- and underground activity, after the mining giant made the decision to put the project into “care and maintenance.”

Much of what was at the residence in Doris North was given away — including tonnes of food and 50 television sets — but Farrow said there’s still a lot of machinery and other equipment on the mine site and “quite a lot of stuff” still in the residence.

A small crew is on site now turning on the lights there. They’ll see what’s needed to be trucked in over the ice road from Cambridge Bay, about 90 kilometres away on Victoria Island, and then plan for other supplies, which will be shipped to the mine site on the mainland during the summer, Farrow said.

But what TMAC has in mind for Hope Bay is a much smaller operation “on a considerably smaller scale” than Newmont envisioned.

While some people will be hired on this summer by TMAC, “we’re not going to have 200 people there in the summer,” Farrow said.

The company is still juggling “lots of scenarios” for how the next few months will play out, she said.

The goals for the 2013 season include bringing back equipment that was shipped out for storage in Quebec.

TMAC will also evaluate to see how much work must be done at Doris North before the mill that Newmont ordered, which is still in South Africa, can be shipped up in 2014.

As well, drillers will spend the summer trying to add value to the high-grade gold in the 80-km greenstone belt, thought to contain at least 10 million ounces of gold, Farrow said.

Then, after a pre-feasibility study, the company will look to raising the money it needs to move ahead by an “initial public offering” or stock market launch, in which members of public can buy shares in the project.

Of course, everything hinges on the transfer of the various permits from regulators— which the Nunavut Impact Review Board said won’t be automatic — and obtaining some certainty of land tenure from the Kitikmeot Inuit Association.

One of the major issues involved in the sudden decision of Newmont to stick the project into “care and maintenance” early in 2012 was the lack of certainty on land tenure.

On that, Farrow said TMAC is hoping for the best. Newmont’s decision switched a kind of “reset button” on attitudes towards the mine project, she said.

That’s because when Newmont hit the brakes on Hope Bay in February 2011, the region lost about 150 jobs and millions of dollars of work contracts.

TMAC now hopes to stick to an “aggressive timeline” to get the mine into production in 2015.

The company wants to develop the mine in stages.

“We’re going to start modestly,” Farrow said. This is the only way that it’s possible to start a mine these days, she said, because the costs of start-up are exploding and many projects typically find themselves 50 per cent over their budget.

Farrow said the goal is to get Doris North underground mine into operation, then look to the belt’s other deposits at Madrid and Boston.

As the gold mine complex grows, many of the people, whom Farrow said she hopes to meet during the Kitikmeot tour, will be able to look to the mine for jobs.

You can meet TMAC at 7 p.m.:

• March 25, at Taloyoak’s Ernie Lyall Community Hall

• March 26, at the Gjoa Haven New Community Hall

• March 27, at Cambridge Bay’s Luke Novoligak Hall, a special meeting for former residents of Umingmaktok

• March 28, at Kugluktuk’s Community Complex; and,

• March 29, at Cambridge Bay’s Luke Novoligak Hall.

TMAC planned to be in Kugaaruk March 24.