The Toronto company is now six weeks late in paying the balance owing on a $17.6 million mine cleanup security bond ordered by the Nunavut Water Board (NWB).

The security was due Dec. 11, but the discussion about how much of it is outstanding remains in the air.

Executive director of NWB, Phillip Depizzo, said last week that after deducting $5 million paid prior to the mine shutting down, the company still has to ante up $12.6 million.

Breakwater claims it paid $6 million in earlier instalments and disagrees with the NWB's $17.6 million cleanup estimate.

Breakwater's Bill Heath said the company estimates it will cost just $9.2 million.

Using that figure, Breakwater claims the security owing is just $3.2 million after deducting its earlier payments.

That is news to the NWB, said Depizzo.

The director said last week that Breakwater has not asked the NWB to review its $17.6 cleanup assessment, nor did the company ask the board for an extension to the now missed Dec. 11 deadline.

"To my knowledge only $5 million has been paid to date -- a $1 million instalment due last July was missed -- and $12.6 million is outstanding."

Heath said last week that negotiations are continuing with DIAND over what form (cash, securities, promissory note, letter of credit, etc.) the security will take.

"It is kind of hard to make a payment if you don't know what form that will take."

"There are a whole range of forms that can be used," said Steve Traynor of DIAND. "Right now I can't disclose the exact form that we are discussing with the company."

Looming in the background is Breakwater's well-publicized financial troubles.

Hammered by low metal markets, the firm posted a $16.9 million net loss in the third quarter of 2002. For the same nine months in 2001 the company lost $97.5 million.

Breakwater has yet to release its year-end results for 2002.

The company owns six other mines located in Quebec, New Brunswick, Tunisia, Honduras and Chile.

Two of the mines (in New Brunswick and Quebec) are currently under "care and maintenance."

Traynor said DIAND is looking to complete negotiations with the company as quickly as possible.

"We are trying hard to manage the situation and make the best of it.

"The company has worked very hard at their debt refinancing and we've had to take that into account in our negotiations as well."

In December, Breakwater announced a restructured debt plan that will remain in place through Jan. 2, 2004.

Meanwhile, Arctic Bay mayor Joanasie Akumalik said residents of the community want to see a cleanup plan in place so decisions can be made on alternate uses for mine-site buildings. The community hopes to see Nanisivik -- including houses, school, health and rec centre, and other buildings -- turned into a territorial training centre.

"It's frustrating," said Akumalik. "People here want to see this moving forward."

The GN's Department of Sustainable Development is looking closely at how Nanisivik might be used down the road.

"We have hired a consultant to assess all of the ideas that are out there," said the GN's Bernie MacIsaac.

"That includes use as a training centre or as an accommodation complex with tourist possibilities, or to support mineral exploration, or with some military participation.

Another possibility is moving some of the existing housing by barge or truck to Arctic Bay, he said.

"The first predication for any of this is the mine reclamation. The site has first to be determined to be safe and healthy for an alternate use, whatever that might be."