KANGIQLINIQ/RANKIN INLET
Agnico Eagle Mines Ltd. (TSX:AEM) received board approval on Oct. 10 from the Nunavut Impact Review Board (NIRB) for the company's proposed Meliadine gold project.

A jumbo drill at Agnico Eagle Mines Ltd. Meliadine project this summer. The Meliadine mine project was recommended for approval by the Nunavut Impact Review Board earlier this month. - photo courtesy of Agnico Eagle Mines Ltd.

Meliadine is located is approximately 24 km northwest of Rankin Inlet and is already accessed by an all-weather service road between the community and the mine site. The road will be expanded and a staging ground and fuel tank farm built at Rankin Inlet's Itivia Bay to facilitate resupply by barge and transport of gold south for final processing and sale.

The construction of the mine is expected to generate approximately 1000 jobs, while the mine itself would require 750 employees once operational. The total Meliadine project is five open-pit mines and one underground mine, expected to produce up to 3.1 million tons of ore annually.

The mine would have an approximate life of 13 years, with a two or three-year construction phase and three or four-year decommissioning phase. Current exploration in the region suggests that mine life could be longer than originally proposed, if new resources are permitted and brought into play.

The NIRB approval follows more than four years of review, and must still await final formal approval from Aboriginal Affairs and Northern Development Canada.

Contained in the board approval were 127 recommended terms and conditions, which include noise mitigation conditions to protect caribou, bird and other animal habitats. As well, berms are to be constructed, where practical, around noisy machinery or sites; flight and blasting restrictions during caribou or bird migration; and flight restrictions anywhere sensitive animal habitat have been identified.

Travel restrictions are recommended to be in place during periods when large aggregates of caribou are spotted (more than 50) within one km of the all-weather access road.

This would mean no public vehicles other than ATVs would have access to the road. Although ATVs would have access to the road during times of restriction, they would be prevented from accessing project-specific bridges.

A one km no-shooting zone is recommended along either side of the road as a condition of public access, along with road monitors to manage compliance.

Other recommendations are that Agnico Eagle participate in a socio-economic monitoring program working group with the Kivalliq Inuit Association, Kivalliq communities affected by the project, and relevant government departments.

Approximately $42 million in further exploration spending was ongoing this summer at Meliadine. To date, Agnico Eagle has published an NI 43-101 compliant 2.8 million ounces of gold in proven and probable reserves (12.0 million tons at 7.4 g/t) at Meliadine. Indicated and inferred gold resources are listed at over 5.7 million ounces of gold.

In 2013, Agnico Eagle's seven mines produced 1,099,335 ounces of gold, with total cash costs per ounce of $672. All mines operated at under budgeted expectations.

The company expects 2014 global gold production to increase to approximately 1,360,000 ounces, with total cash costs per ounce at approximately $650 to $675 per ounce. This increase from previous 2014 global estimates of just over 1.1 million ounces gold is thanks partly to the company's acquisition of 50 per cent interest in the Osisko Mining Corporation to operate the Malartic mine in Quebec.

The Meadowbank open-pit mine, 110 km north of Baker Lake, employs 672 people and is expected to reach end of life in 2017.

Assuming a positive investment decision, Agnico Eagle could begin construction of the Meliadine mine as early as 2018.