CanTung Mine abandoned
No bids means mine reverts back to feds, GNWT says
April Hudson
Northern News Services
Thursday, November 26, 2015
TTHENAAGO/NAHANNI BUTTE
After six months under creditor protection, North American Tungsten Company Ltd. CanTung and Mactung properties now belong to the government.
North American Tungsten's Cantung Mine near the Yukon-NWT border. The mine was declared abandoned and is now the property of the federal government. - photo courtesy of North American Tungsten
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North American Tungsten held a sale for both properties in October. At the time, the offers -- which are kept confidential -- were deemed unacceptable.
On Nov. 19, the Government of the Northwest Territories announced it had acquired leasehold interests for Mactung.
In the meantime, CanTung has been declared abandoned and is now the responsibility of the federal government.
Andrew Livingstone, GNWT's senior cabinet communications adviser, told Deh Cho Drum it was made possible due to a chapter in the Devolution Agreement.
"The Devolution Agreement has a five-year clause in it that allows sites that were federal prior to the devolving of powers to the territory to be returned in the first five years of the agreement being in place," Livingstone said.
He referred further questions regarding CanTung to the federal government.
As of Oct. 18, CanTung became federal property. The GNWT is also transferring its rights to funds held in trust, as security for water licence requirements, to the federal government.
North American Tungsten's directors and officers have resigned, and most staff members have been laid off. The company's environmental superintendent, Deborah Flemming, said there are currently nine employees and four catering staff left, most of whom are preparing the CanTung mine for winter shutdown under North American Tungsten's care and maintenance plan.
After Nov. 25, Flemming said, there will be 10 employees in total, working two five-person shifts at the mine on a three-week rotation.
According to a Nov. 19 news release from North American Tungsten, the B.C. Supreme Court ordered an extension of the company's stay of proceedings until March 31, 2016. At the time, the courts also expanded the power of court-appointed monitor Alvarez and Marsal, which is overseeing the company's creditor protection process.
Further, the courts approved some equipment financers to take possession of equipment North American Tungsten does not require for its care and maintenance operations.
The federal government is expected to fund care and maintenance activities at CanTung under the supervision of Alvarez and Marsal.
The care and maintenance period is expected to begin Nov. 25.
Request approved in midst of election
The GNWT's acquisition of the Mactung property for $4.5 million came days before the end of the territorial election.
Livingstone said approval of the funds by cabinet was possible due to a special warrant approved by the Commissioner of the NWT.
Special warrants can be authorized when the legislative assembly is not in session, he added, "if the financial management board reports to the Commissioner that the expenditure is urgently required, the expenditure is in the public interest and there is no appropriate or insufficient appropriation to incur the expenditure," he said.
Cabinet ministers do not step down during an election, and, Livingstone said, "(remain) in office until the day a new cabinet is chosen."
Shutdown marred by spill
In a Nov. 19 e-mail to regional water officer Brad McInnes, North American Tungsten issued a report on a spill that occurred Nov. 15.
That spill saw 138 cubic metres of mine water enter CanTung's polishing pond instead of its tailings pond.
The polishing pond is considered a containment area, which discharges to the Flat River. An overview of the incident notes the pond has not discharged to the river since the spill.
An investigation into the spill showed an electrical fault in the level sensor in the mine seepage.
The spill report notes mine staff have been monitoring mine seepage water quality constantly since Nov. 2 in preparation for officially diverting the water from the tailings pond to the polishing pond. At the time of the spill, however, the diversion was unintended.
Currently, seepage water goes to the tailings pond and then through a water treatment facility for discharge under the mine's water licence and the metal mines effluent regulations. Once the care and maintenance period begins, water will be diverted to the polishing pond.
