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KANGIQLINIQ/RANKIN INLET - The global financial meltdown has claimed another victim in the Northern mining industry.

Just weeks after Indian and Northern Affairs Canada (INAC) reported a sharp decline in 2009 prospecting permits for Nunavut, yet another exploration company has announced it will significantly cut down on spending this summer.

Comaplex Minerals Corp. is cutting back sharply on spending at its Meliadine gold project near Rankin Inlet this summer. Here, drillers plumb the bedrock of the site in 2007. - photo courtesy of Comaplex Minerals Corp.

Comaplex Minerals Corp. spent between $20 and $25 million developing its Meliadine gold project 24 km north of Rankin Inlet last year.

While plans for this summer are two months away from being finalized, the company already knows it will spend less this year, said Mark Balog, chief operating officer for Comaplex.

"Without question," said Balog. "We're holding our cash very close to our chest. This is a very serious downturn."

Comaplex has cash and liquid investments of approximately $21 million, according to a preliminary assessment of Meliadine released by the company on Feb. 2.

"We're well-financed, but it is extremely difficult to raise money without giving away your soul at the moment," said Balog.

This summer's campaign will also depend on 2008 drilling results on two Meliadine deposits that are still pending, he added.

"That will drive where we're going to put our drilling, if any."

Those results excluded, Meliadine is host to 2.29 million ounces of gold minable at a price of $700 per ounce, according to the assessment.

"If we end up using $750, a lot more of those ounces come into play because it makes sense to go after them. The economics can support (it)," said Balog.

While this year's program may not be as robust, that won't come at the cost of Rankin Inlet community members hired to maintain the camp and provide upgrades to on-site infrastructure.

Balog estimates that Comaplex hired "in the neighbourhood" of 10 people from Rankin Inlet last summer, and doesn't expect that number to decrease.

"We've had people in camp from Rankin all the way through the winter," he said.

The preliminary assessment revealed new details about the Meliadine mine, whose cost is projected at $382 million.

While Balog previously predicted a mine life between eight and 12 years, the scoping study narrowed it down to nine-and-a-half years, with a per-day mining average of 2,000 tonnes underground and 1,000 tonnes coming from open pits. The mine will require a total workforce of 430 people, with between 230 and 240 on site on any given day.

An all-season road will connect Rankin Inlet to the site.

Comaplex's projected spending decrease comes on the heels of INAC announcing 122 Nunavut prospecting permits were issued by the federal government this year - down 100 permits from last year and the lowest number of permits issued since 2004.

To makes things cloudier, INAC estimated that exploration spending in territory went down by $30 million last year, compared to 2007.

"Let's face it; things are tight and I can guarantee that there will not be the same level of activity not only just in the North, but ... in the industry in general," said Rick Mazur, president and CEO of Forum Uranium Corp.

For its part, unless it finds a funding partner in the next few months, Forum will limit activity on a recently acquired parcel of Nunavut Tunngavik Inc. land to on-site maintenance this summer, added Mazur.