Guy Quenneville
Northern News Services
Published Monday, July 07, 2008
KINNGUAK/BATHURST INLET - The biggest potential financial backer of the Bathurst Inlet Port and Road project (BIPAR) is pulling out and building its own road west of Bathurst Inlet.
Australia-based Zinifex Ltd., which hopes to have its Izok Lake zinc and copper mine ready for operation by 2014, has decided to construct a road that will go through all its eastern Kitikmeot development projects, including the Lupin, Ulu, High Lake and Izok mines, and end at Grays Bay.
"It's the same idea as our project. It's just specifically tailored to their requirements," said Bob Gilroy of Nuna Logistics, the Inuit-owned company developing BIPAR.
"We're disappointed in the decision, but it doesn't really change the purpose of the project" - or the prospect of it moving forward, he added.
Nuna still plans to build a port at Bathurst Inlet capable of housing and shipping crucial mining supplies like fuel, as well as an accompanying all-weather road south to Contwoyto Lake.
Andrew Mitchell, development manager of Canadian operations for Zinifex, said the enormous cost of the project, estimated at $270 million, and the absence of other formally committed contributors, played a hand in the company's decision.
"We absolutely need a road, and if other participants cannot be formally pinned down, what is the cost going to be? That defines the risk to us," said Mitchell.
Operational factors also accounted for part of the decision.
"The system we've selected has no lake crossings," he said.
"The BIPAR system crosses Contwoyto Lake, so that restricts your operational seasons to the winter when there's ice and the summer when you can pull a barge across the lake. That would have eliminated about three or four months of operation."
With Zinifex now out of the picture, Nuna is talking to other companies with projects in the area, including junior exploration company Sabina Silver Corp., which is currently developing its Hackett River mine in the region.
The zinc-copper-lead mine, located east of Tahera Diamond Corp.'s Jericho diamond mine, has an expected mine life of 14 years and will also require an all-season road supply system.
Sabina is considering BIPAR as a method of shipping concentrate out of Hackett River, according to Harvey Klatt, vice president of exploration for the company.
"We need some kind of connection to the coast, otherwise we have no project," said Klatt.
"There's a lack of infrastructure in Nunavut. Maybe BIPAR can solve that for us."
BIPAR is further advanced in the process than anything else out there, making it the most attractive option at the moment, he added.
Zinifex's decision to pull out of BIPAR doesn't sit well with Charlie Lyall, president and CEO of the Kitikmeot Corp.
"(Their road) will benefit one organization and one organization only, and that is Zinifex. BIPAR stood to benefit the whole region," said Lyall.
Mitchell said Zinifex will seek workers from Kugluktuk and Cambridge Bay, and possibly the western Kitikmeot region, to operate its port and road. Lyall will hold the company to its promise.
"They'll be bringing in people from the United States, they'll be brining in people from New Zealand," said Lyall. "By God, they better be recruiting people from the rest of the (Kitikmeot) region."
Zinifex recently opened an office in Kugluktuk staffed by a stakeholder relations officer, Donald Havioyak, former president of the Kitikmeot Inuit Association, who will facilitate communications with the communities.
Earlier this year, BIPAR was dealt a setback upon learning that five parties were seeking intervener funding from Indian and Northern Affairs Canada to make a case against the project.
According to Gilroy, the Nunavut Impact Review Board - which was set to begin the technical review of BIPAR's feasibility study in January - will hold off on the review until the parties receive their funding.
Despite the delay, Gilroy said the road and port project is still on schedule to open in 2012.
