Toronto’s TAHERA DIAMOND CORP. has decided to suspend mining at the Jericho mine early in February. The announcement follows news that the company is losing money on every stone it produces.
In these days of high commodity prices, and those days are stretching into years, failure to make a profit is rare. Nonetheless, Tahera has asked for and been granted protection under the Companies’ Creditors Arrangement Act (CCAA). By suspending mining, the company will preserve what little cash it has while it works on a restructuring plan.
The Jericho mine officially opened in August 2006, and now less than 18 months later, it is over, leaving millions of carats in the ground. The closure marks another gap in Nunavut mining history, at least for the time being. The previous gap in the territory’s mineral industry occurred when the Lupin gold mine on Contwoyto Lake exhausted its ore in 2005 after 13 years of operation.
All is not lost, however. There are two new gold developments underway in Nunavut.
The Hope Bay project is scheduled to begin production in the second half of this year. This was the flagship property of Vancouver’s MIRAMAR MINING, which was acquired by NEWMONT MINING of Denver in mid-January 2008. The property has indicated resources of 36.0 million tonnes averaging 4.5 g/t Au. The inferred resource totals 46.0 million tonnes at 3.6 g/t Au. All told, there are probably more than 10.5 million oz of gold in the ground. (www.MirmarMining.com)
The Meadowbank gold project is likely to begin production in 2010. It is owned by AGNICO-EAGLE MINES of Toronto through its acquisition of CUMBERLAND RESOURCES in July 2007. Probable reserves there are 27.7 million tonnes at 3.9 g/t Au. Total cost will be about $390 million to create a 400,000-oz/y operation.
As for the Jericho diamonds – they aren’t going anywhere while mining is suspended. When Tahera (www.Tahera.com) or its successor is ready to restart operations, it will know where to find what it wants. With any luck that won’t be long.