by Jeff Colbourne
Northern News Services

NNSL (Apr 08/98) - BHP is slashing its exploration budget in the NWT, and it is blaming the decrease in part on the debate over a secondary diamond industry.

The value-added issue may even lead to reduced interest and less mining exploration and development in the North, according to Jim Rothwell, BHP's group general manager.

Speaking to the NWT Chamber of Commerce last weekend, Rothwell said the debate and the way it has been handled by various parties is hurting the investment climate in the North.

"I have been advised that BHP's exploration group will be reducing its exploration spending in the North in the next fiscal year," said Rothwell.

This is due to a number of factors, he said, including budget issues at BHP, depressed gold market and a perceived deterioration in the investment climate, he said.

"Our Ekati diamond mine development and other proposed diamond mines resulted from exploration started in the early 1990s was fostered by a positive and encouraging atmosphere toward development," he said.

Premier Don Morin said he is not worried about Rothwell's comments or about the future of Northern exploration.

"I don't think there will be decreased exploration in the NWT," said Morin. Our job as government is to look after Northerners' interest.... BHP's job is to look after the interest of their company and to ensure they mine diamonds in the most economic way they can."

When it comes to value-added industries Morin said he's pleased to be working in a partnership with BHP to achieve this goal.

"I found Jim Rothwell very straightforward to talk to and I think it's safe to say his priorities and what they want to achieve in the end is basically the same as we want to achieve," said Morin.

The GNWT said it is committed to working with BHP to ensure that Northerners get jobs in secondary industries but Morin said that will not happen overnight.

"I don't think we are going to have secondary industries up and running by fall but I can't really foretell the future. It depends on the quality of people that come into the North and work in the private sector."

"As long as we have a commitment then we'll work together to achieve it. If it takes five years to achieve, that's fine as long as we can achieve it so that Northerners can benefit and the jobs are in the North," said Morin.