by Nancy Gardiner
Northern News Services

NNSL (Apr 28/97) - With an increasing market demand for beryllium, Highwood Resources wants to reactivate its Thor Lake mine in the NWT.

John Smrke, the chairman and CEO of Highwood Resources, is also considering three options for a small-scale beryllium processing plant that could be expanded in future. It's still uncertain how many people would be employed.

The three sites he's examining are Hay River, Yellowknife and the actual Thor Lake site.

Smrke says mining will proceed if his company is granted a water licence. He was in Hay River April 21 to meet with Mayor Jack Rowe and the town's chamber of commerce.

"The reason we're in Hay River now is we're compiling information to assist us in learning the economics of the project," Smrke said last week.

First, the company needs to consider the environmental aspects and obtain a federal water licence. Highwood Resources hopes to have the application submitted by mid-summer. Smrke anticipates a four- to eight-month wait for approval after that.

In the meantime, he has met with community leaders in the area, including Chief Felix Lockhart of Lutselk'e, the Yellowknives Dene and the Metis Alliance.

The property was opened up in the late 1970s. From the 1980s on, a variety of work was done at the site.

During the 1980s beryllium was used in the manufacture of missiles and other weapons, but demand dwindled in the 1990s and the Thor Lake site was left dormant until last April.

Highwood is reactivating its interest in the property because "$12 million has already been spent on the location and technical work related to Thor Lake," said Smrke.

More importantly, reports Highwood Resources president Garry Lenkowski, the demand for beryllium is up.

"Demand is on the rise. We see a piece of the market, it's high profile and a high-grade property. It has different applications for satellite technology and telecommunications, aircraft manufacturing and there's still military and defence sectors," says Lenkowski.

The Thor Lake property is located near the East Arm of Great Slave Lake, about four kilometres north of the shoreline and 135 kilometres from Yellowknife.

Some work was done in previous years. Still standing are a camp that serves as living quarters for test and exploration work, several large-capacity fuel storage tanks and additional small maintenance buildings. There's also a ramp access to an underground area.

"Due to the nature of the deposit, the ore body has several sections to it. It would start as an open pit, then it would go underground," said Smrke.

In the 80s, the majority of work focused on beryllium. Little was done to determine what other rare earth elements would be in the ore body, said Smrke.

Mineral processing activities involve crushing, grinding and reducing the beryllium ore to a concentrate. This would be done at a processing plant in the North, assuming the application goes ahead, Smrke said.

The material would likely leave the Thor Lake site either by barge or by winter road truck. Once processed, it would likely be shipped south by truck or rail.

The concentrate is similar to finely crushed sand in a damp form -- it would clump if you squished it in your hands.

Although Hay River is further from the mine site than Yellowknife, it has some benefits, such as the possibility of shipping by rail, said Smrke.

In making a decision on the location of a processing plant, Smrke will study the value of land, buildings, available miners and experience of the workforce in the areas under consideration.

According to Smrke, there's only one other producer of beryllium in North America a publicly-traded company in Utah, Brush-Wellman, said Smrke.

Brush-Wellman did some market testing, said Smrke, and people have started to create products out of the beryllium alloy.

"It's now widely used in computer hardware components and high-strength oil-rig tools that are non-sparking." Highwood would not become involved in this production process, however, since its goal is the ultimate sale of beryllium in alloy form so it can be shipped as bricks, bars, wire, rods, and other forms, said Smrke.

Beryllium is also produced in Asia in substantive quantities, but buyers would rather purchase in North America due to quality assurance, he added.

"The big challenge will be to break into the North American marketplace. We would be extremely proud to be the only Canadian producer of beryllium."

Smrke admits that "it's not the easiest thing to do and there's a lot of risk involved any time you take on something like this, but we feel it will be well-received."

There will be low-level radioactivity at the site from thorium found in the same area, but Smrke would not say how hot the site will be.

"Can't say what percentage -- the ore body has several different lenses to it, because of the nature of rare earth."

Royal Oak Inc. is the largest individual common shareholder in Highwood Resources, with 38 per cent of Highwood's common shares.