QAMANITTUAQ/BAKER LAKE - The third mine ever developed in the Kivalliq region and Nunavut's first operating mine since the closure of the Jericho diamond mine in 2008 is on schedule to begin commercial production in a mere three months.

The Meadowbank gold mine, located 70 km north of Baker Lake, is on schedule to begin commercial production in mid-January. Construction on the $700 million mine is nearly complete, said on-site manager Denis Gourde. - photo courtesy of Agnico-Eagle

Agnico-Eagle's Meadowbank gold mine, located 70 km north of Baker Lake, is in the final stages of construction, with commissioning of the mine's process plant scheduled for mid-January and gold prices recently hovering about the $1,000-per-ounce range.

"We're still in the end phase of construction of the power plant and the process plant and the service building including truck shock. We'll be ready by the end of the year," said Denis Gourde, on-site manager for Agnico-Eagle.

Half a million tonnes of ore will be ready for processing when commercial production begins. The yearly rate of production at Meadowbank, which is host to 32 million tonnes of gold, will be around three million tonnes.

"We're going to start at a lower pace; within the end of the month, we should be at full pace," said Gourde of the initial start-up.

The company has spent $600 million of the mine's $700 million cost, with 44 per cent of spending going to Northern companies, and three per cent of that to businesses in Baker Lake, which has undergone a substantial transformation in the last two and a half years, said Gourde.

Of the 176 direct employees hired by Agnico-Eagle during the construction phase, 135 came from Baker, the rest travelling from Repulse Bay, Arviat, Chesterfield Inlet, Whale Cove and Rankin Inlet.

"We kind of created a middle class," said Gourde of Baker Lake. "There's a high volume of pickup trucks and cars in town compared to a few years ago."

David Aksawnee, mayor of Baker Lake, agreed the degree of chance is significant, though Meadowbank employees have succeeded in finding time for both work and traditional hunting practices thanks to the two-weeks-in, two-weeks-out work cycle at Meadowbank.

Aksawnee said Meadowbank is the largest private employer in the region, directly and indirectly.

"All the contractors here are pretty well hiring local people to be working on heavy equipment or hauling freight when the barges come in," he said.

Though residents are aware the Meadowbank only has a life expectancy of approximately 10 years, "It's a happier lifestyle than we've had in so many years. The people who are working, they're happy. Their families, their kids are well-fed and well-clothed."

With an eye toward extending the mine life, Agnico-Eagle spent $13 million on additional exploration around the Meadowbank deposit this year, and more exploration is planned for 2010, said Gourde.

There have been two other mines in the Kivalliq region in the past 50 years. The North Rankin nickel mine near Rankin Inlet operated from 1957 to 1962 while the Cullaton Lake-Shear Lake gold mine, located 230 km west of Arviat, ran from 1981 to 1985.