RANKIN INLET
The Kivalliq region received a huge boost when Agnico Eagle Mines (AEM) announced plans to have both the Meliadine gold project near Rankin Inlet and the Amaruq satellite deposit near Baker Lake's Meadowbank gold mine become operational by 2019.

Aaron Kigeak of Rankin Inlet is employed with site services at the Meliadine gold project on the land just outside of Rankin in February of 2017. - photo courtesy of Agnico Eagle Mines

AEM will spend a combined $1.2 billion on the two operations.

The company's board of directors approved plans to spend $900 million to develop Meliadine and $300 million to start working the Amaruq satellite deposit.

AEM will employ more than 700 Inuit from the Kivalliq on the combined gold projects, and bring $66 million per year to the region in payroll, $9.5 million a year to the Government of Nunavut in property and payroll taxes, and more than $60 million per year to the federal government in payroll taxes.

The company estimates the life of the Meliadine mine to be 14 years, while it hopes the Amaruq project will add six years to the life of Meadowbank.

Vice president for Nunavut operations Dominique Girard said, in making the announcement this past month, AEM reached the point where it studied Meliadine enough to be confident in how much it's going to cost, how long it's going to take to construct, and having the right returns to fit the company's trigger.

He said AEM is comfortable in what it sees and the timing is right for both Meliadine and Amaruq to proceed.

"It is a good time to build a mine because it's quiet everywhere, making it a good time to get good contractors and a good price on equipment, so we're trying to be in a good position to move into that cycle," said Girard.

"We're pretty confident both will be operational by 2019, because we have the resources to manage those projects after being in Nunavut for 10 years now and building good capacity with Meadowbank.

"We're using that capacity on both projects, although, of course, we need to add resources to built them in both the constructional and operational stages.

"We have 60 per cent of the engineering done at Meliadine; meaning we are well beyond the concept stage of the project, have detailed drawings, are ready to go to construction, and have ordered all the longtime-delivery equipment at the end of this past year to ensure we'll have it all in time for construction and to start both projects by 2019."

Girard said one area AEM cannot control is the price of gold. He said mining is a risky business, but AEM is willing to take that risk.

"If the price of gold were to drop we would need to adapt the pace of building the projects, but that's part of the game.

"We have leverage with the currency in that although the gold price is in U.S. dollars, there is usually a relationship between the two and when we look at the price in Canadian dollars, it's not so bad because of the exchange-rate effect that helps us when the price of gold is moving.

"The Inuit Impact Benefit Agreement for Meliadine was signed in July of 2015 and, working closely with the Kivalliq Inuit Association (KIA), we're amending it a bit right now and its implementation is well on track.

"It's going to be a good challenge, as well as a very good opportunity, for Rankin Inlet and all of the Kivalliq because we're going to create more jobs than we have people to fill."

Girard said a plan is in place to create a labour pool to ensure AEM hires everyone who has a skill, is willing and available to work during both the construction and operational stages of the projects.

He said AEM is going to train more people for entry-level positions and then develop career paths for them.

"We've succeeded doing this at Meadowbank and we're going to continue with the approach at Meliadine.

"We've done more business with Baker Lake than Rankin Inlet at this point because of Meadowbank, but there's more and more action taking place in Rankin, so we're steadily building our relationship with that community now, too.

"Our long-term goal is to have as much of our mine managed by Inuit as we can, which will take a generation to accomplish, just as we've done in Quebec, Finland and Mexico.

"We need the support of education, the Government of Nunavut and the hamlet, with everyone working together, to achieve that goal, but it's a huge opportunity to develop people here."

Girard said AEM will work with the hamlet of Rankin Inlet to assess what the community's needs are in terms of additional infrastructure and how the company may be able to help.

He said royalties from the project, however, will be going to the Kivalliq Inuit Association (KIA), as the Inuit organization is best suited to identify the needs of the community.

"The royalties represent a good amount of money and our relationship with the KIA has to be built to reinvest that money wherever it's going to be the biggest benefit to the community.

"The way we see it the Inuit association is the best way to reallocate that money, so everything is built to reinvest into the community by going through the KIA."

AEM is currently in discussions with the hamlet and Transport Canada to build a bypass road and a fuel-tank farm in Rankin this year.

The 2017 sealift season is critical in having a good start to the Meliadine project, but AEM has advanced the project far enough during the past six years to have a high degree of confidence in achieving its target start-up date of 2019.

Girard said AEM is also focused on increasing awareness on opportunities within the mining industry with students as early as elementary school.

He said teachers from Baker Lake and Rankin Inlet met with the AEM team in Rankin this past month to discuss industry opportunities, and how to raise mining matters in the early stages of school curriculum.

"This has to be done in-line with the GN because, at the end of the day, our core business is to mine and we're not responsible for the educational part.

"This approach is ongoing in schools in Baker Lake, starting in Rankin Inlet schools, and moving right up to Nunavut Arctic College.

"We are involved with a program to develop underground miners and we are already hiring people from two courses that have already been completed.

"We all need to support this type of programming to have people ready to work in the mine and, five years from now, if they're ready to work for Agnico Eagle, we're going to hire them."