Canadian Mining Journal

Feature

B.C. Government programs boost exploration

The new government in British Columbia has demonstrated its commitment to mining by improving and harmonizing the 20% British Columbia Exploration Tax Credit with the Federal Exploration Investment Ta...


The new government in British Columbia has demonstrated its commitment to mining by improving and harmonizing the 20% British Columbia Exploration Tax Credit with the Federal Exploration Investment Tax Credit for flow-through share investors. As these two programs combined can result in an equivalent 139% tax reduction, the province now has one of the most attractive exploration incentive programs in Canada.

Explorers have been dusting off their files on British Columbia, conducting property examinations, and acquiring ground. Field-related exploration spending for 2001 is estimated at $32 million, while total exploration and deposit appraisal spending is projected to be $48 million. Included in this total are 57 projects with budgets in excess of $100,000. Mine site exploration spending accounted for 40% of total expenditures and was dominated by programs at three metal mines (Eskay Creek, Kemess and Myra Falls) and two coal mines (Line Creek and Fording Coal). The total value of solid mineral production is estimated at $2.9 billion.

Other key indicators of renewed exploration interest in British Columbia are that drilling, on over 80 projects, was up by 13% in 2001 and that the number of forfeited claims decreased by 15%. Claim staking continued to be up by more than 50% from the late 1990s, and the number of new Free Miners Certificates issued remained steady.

Mining & Development

Production at Barrick Gold‘s Eskay Creek massive sulphide, high-grade deposit in northern British Columbia is forecast to be 313,500 ounces of gold (oz Au) and 13.3 million ounces of silver (oz Ag). Nearly 35,000 m of exploration drilling was completed at the mine site and in the immediate vicinity.

The Kemess South mine, operated by Northgate Exploration, continued to improve mining, milling and transportation operations. It is forecast to produce 257,000 oz Au and 69 million pounds Cu.

At Boliden-Westmin (Cana- da)‘s. Myra Falls volcanogenic massive sulphide deposit on Vancouver Island, exploration drilling focused primarily on testing the Price and Lynx deposits. Production was suspended in December due to low metal prices. Work continues on advancing the decline, but exploration ceased and the mine is currently for sale.

Teck Cominco Ltd.’s Sullivan sedex zinc-lead-silver mine closed on Dec. 21, 2001. Over the past century, the mine produced some 8 million tonnes (t) Zn, 9 million t Pb, and more than 285 million oz Ag for a total value of more than $20 billion at today’s prices.

Clean coal production in B.C. is expected to total about 26.6 million t in 2001 with a projected value of about $1.6 billion, or roughly 35% of total solid mineral production. Pine Valley Coal has a permit for a trial cargo of 100,000 t from its Willow Creek project in the Northeast Coalfield, and shipped and sold 36,000 t during 2001.

T’Sable River Coal conducted a modest drilling program in preparation for a large drilling and underground development program planned for this year on its T’Sable River project on Vancouver Island. Western Canadian Coal has entered the provincial environmental assessment process for a project approval certificate for its Wolverine EB open-pit mine in the northeast.

There are more than 40 industrial mines and quarries in British Columbia, and at least 20 major sites where these raw materials are being upgraded into value-added products. It is significant that there are increasing exports of crushed stone and natural aggregate to urban centres along the west coast of the United States.

An important development was the startup of the Ashcroft basalt quarry and related roofing-granule plant. The November 2000 spike in tantalum prices attracted attention to a variety of high technology minerals in the province.

Advanced and Grassroots Exploration

The main focus for exploration during the past year was polymetallic massive sulphide (28%), porphyry (28%), and coal (22%) deposits, and a number of new discoveries were made. Northgate’s discovery of significant additional resources at the Kemess North deposit, 6 km north of the mine, has not only provided the potential to extend the mine life but has also led to a revitalization of exploration in the entire Toodoggone camp.

Sultan Minerals tested its recently discovered Gold Mountain zone on its Kena intrusion-related gold project near Nelson. Assays to date, and preliminary petrographic and metallurgical studies, suggest potential for a large tonnage, possibly heap-leachable, nonrefractory gold deposit. There is also potential for bonanza-grade gold zones internal to the lower grade areas.

Drilling on the Lorraine property, northwest of Germansen Landing, indicates that the extent of the porphyry iron-oxide-copper-gold mineralization may be much larger than previously believed; three discrete zones traced along a 1.4-km strike length may coalesce and continue to depth.

DRC Resources completed 26 drill holes to test the deep mineralization beneath and adjacent to the southwest end of the Afton porphyry Cu-Au-Ag-Pd deposit. The potential for development of an underground block-caving operation was investigated and an updated mineral resource study will be undertaken in 2002. Pacific Booker re-drilled the Morrison porphyry Cu-Au deposit on 60-m centres to depths of 300 m.

Drilling by International Wayside on its Cariboo mesothermal Au-quartz project in the Wells-Barkerville camp tested the newly discovered Bonanza Ledge zone(s) over a minimum 1-km strike length, and other auriferous pyrite replacement targets to the northwest along the Wells Trend. Drilling by Newmont on the RDN prospect, 40 km north of the Eskay Creek mine, confirmed the close similarity to an Eskay Creek setting.

The most active area for platinum group element exploration was a belt of ultramafic rocks on the east side of Harrison Lake that extends over 75 km northwest from Hope. Within this belt, Leader Mining discovered a large magnesium-rich ultramafic intrusive body on the Cogburn property.

The largest increase in exploration expenditures during 2001 occurred in the coal sector, and included testing the potential for coalbed methane.

Government Initiatives

The Geological Survey Branch (GSB) has carried out a wide range of activities throughout B.C. designed to improve the exploration databases and assist in stimulating exploration. More information is available on the Ministry of Energy & Mines’ web site at www.em.gov.bc.ca/geology

Tom G. Schroeter is a manager at the Mineral Development Office, British Columbia Ministry of Energy & Mines, Geological Survey Branch


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