Darrell Greer
Northern News Services

RANKIN INLET (Jan 27/99) - Australian-based WMC International Ltd.'s Meliadine West gold project, just outside of Rankin Inlet, may have been slowed by low gold prices, a 10-year mine life expectancy projection and the company's commitment to more developed projects, but it definitely hasn't been put on hold, said site manager Joe Campbell at a public information session in Rankin earlier this month.

Since beginning exploration in 1995, more than 20 per cent (about $5.5 million) of the almost $30 million spent on Meliadine exploration has been spent directly on wages, services and supplies from within the Kivalliq Region or to an Inuit-owned company. The company is also running a smaller gold exploration project at Peter Lake.

Presentations detailed the company's intention during the next year to continue working at Meliadine to find more ore and Campbell said he's confident more will be found. He said economic projections for the project were made when gold was below $300 US an ounce and the company still believes the Meliadine site will prove itself to be economically viable.

"There's no doubt if the price of gold were to go up it would make this project a lot more attractive, but we're not held hostage by the price of gold anymore than any other project in the world," said Campbell. "Everybody is suffering with lower gold prices. The prices are lower than they have been in 20 years."

Campbell said WMC would like to see a projected mine life span of about 20 years before proceeding, double that projected now, but quickly added that doesn't mean open pit mining will be the only way to go. Open pit mining extends the life of a mineral deposit site because, basically, more of the mineral can be accessed than through underground mining.

"We will be focusing on ways of doubling the mine's projected life span without necessarily committing to open pit and that's what we'll be doing with our exploration this year, focusing on finding deposits in the zones we haven't discovered yet. From doing that, that gives us more higher-grade material we can access to increase mine life that way.

"Our schedule right now is to do our test mining in the 1999-2000 period and, after that, we would make a decision on whether to go into a feasibility study, which is a complete design of the mine. After that, you would be into construction."

Campbell said a feasibility study would take from nine months to a year and would include the engineer's studies to determine where the pits would actually be, equipment needed to run them, number of employees, where the office structure will be and the costs associated with the work.

"We're looking at another year of exploration, a year after that of testing and a feasibility study and then, if everything shows it's economically feasible, we would go to construction. So, we're looking at, at least, two years from this point."

For a pre-construction level, Campbell said Meliadine is still the top-ranked project for WMC, but is competing with projects already in construction and expansions on mines already in operation, which are eating up huge amounts of WMC's capital.

"This project hasn't reached that level of expenditure yet. Once the company gets over the hump of financing the larger projects, we're the next in line."