Summary of Mining and Exploration, Northwest Territories

Mineral production in the Northwest Territories grew in 2002 but there was a net decrease in the number of exploration projects.

The Ekati mine (80% BHP Billiton; 10% Stewart Blusson; 10% Charles Fipke) produced 4.38 million carats between July 1, 2001 and June 30, 2002, mostly from the Panda kimberlite pipe. A second pipe, Misery, came into production in January, and limited underground production from Koala North began during the summer. Proven and probable reserves as of June 2002 are 58 million tonnes grading 0.9 carat/tonne (with a cut-off size >1.5 mm).

Construction of the Diavik diamond mine (60% Diavik Diamond Mines Inc.; 40% Aber Diamond Mines Ltd.) is proceeding on schedule. Water from behind the diversion dike surrounding pipe A154 has been removed, and completion of the processing and recovery plants is expected by November 2002. Initial mining of A154 should commence in November, with production by February 2003. The deposit contains a diluted minable reserve of 27.1 million tonnes of kimberlite containing 106.7 million carats in four pipes.

A third diamond deposit, De Beers-owned Snap Lake project, moved one step closer to production with the submission in February 2002 of an environmental assessment. The deposit contains 22.8 million tonnes of minable ore grading 1.57 carats/tonne, in a shallowly-dipping kimberlite dike. De Beers plans to begin production in 2006.

Miramar Mining Inc.’s Con and Giant gold mines in Yellowknife increased production in spite of a temporary second-quarter shutdown of the autoclave. During this period, free-milling ore grade was higher than expected and refractory ore flotation concentrates were stockpiled, which helped offset the temporary reduction in shipped gold. Production in the first two quarters of 2002 totaled 57,540 oz at a cost of US$222/oz. The company plans to extend operation of the mines to 2004.

After 14 years the Cantung mine was re-opened by North American Tungsten. Rehabilitation of the mine and mill began in July 2001, and commercial production commenced in April 2002. The second quarter saw a total production of 73,434 metric tonne units (MTU) of tungsten concentrate (1 MTU = 10 kg). Third quarter production increased to 103,772 MTU, putting the company on track with their targeted annual production rate.

De Beers Canada Exploration, operators of the Gahcho Ku diamond project (jointly owned with Mountain Province Diamonds Inc. and Camphor Ventures Inc.), bulk sampled the Hearne (684 tonnes) and 5034 (836 tonnes) kimberlite pipes at Kennady Lake. Results to date report 1,215 carats recovered from 5034, including 70 stones over 1 carat. The east, central and west lobes of 5034 contain an estimated indicated resource of 8.11 million tonnes to 300 m depth.

Elsewhere in the Slave Province, drilling intersected new kimberlites on the following properties: GGL Diamond Corp. on its Seahorse property; Shear Minerals Ltd. (with Mantle Minerals Inc., Dasher Energy Corp. and International Samuel Exploration Corp.) at Afridi Lake; as well as three new kimberlites on Diavik’s property. Other exploration included geophysical surveys, till sampling, drilling, and analyses of previously-discovered kimberlites for diamond content.

Tyhee Development Corp. prospected for breccia-hosted polymetallic mineralization in the Bear Province, and acquired the Discovery mine and Nicholas Lake gold deposits in the Slave Province. Tyhee drilled the northern extension of the Ormsby zone of the Discovery mine to upgrade this resource. Seven holes (1821 m) were drilled in the Nicholas Lake deposit in 2002.

Canadian Zinc Corp. optioned the Damoti Lake gold deposit from Doublestar Resources Ltd. in June 2002. Damoti Lake is an iron formation-hosted deposit. This summer, Canadian Zinc compiled existing geologic data and carried out limited property examinations.

Seabridge Gold Inc. acquired the Courageous Lake gold deposit from Newmont Canada Ltd. and Total Resources Ltd. in July 2002. Resource Modelling Inc. reviewed a previous resource model and reported a measured resource of 168,000 ounces gold and an indicated resource of 2,253,000 oz.

A scoping level assessment of Fortune Minerals Ltd.’s 80%-owned Nico property in the Bear Province concluded that the cobalt-gold-bismuth deposit is viable as an open pit (for low-grade ore) or underground operation (selective mining of high-grade ore). The deposit has an indicated resource of 37.5 million tonnes grading 0.09% Co, 0.45% Au and 0.1% Bi.

C. Relf is chief geologist, and K. Gochnauer and S. Goff are district geologists with the Department of Indian Affairs and Northern Development, NWT Geology Division