Nunavik iron mine may change tiny Aupaluk’s future

This map shows where three iron-rich deposits lie along Nunavik’s Ungava Bay. (IMAGE/ OCEANIC IRON ORE)

Six years ago mining interests from the United Arab Emirates were encouraging residents of Aupaluk to dream of a mega-mine employing 10,000 workers.

The size of the mine’s workforce would rival the entire population of Nunavik, and be nearly 100 times larger than tiny Aupaluk, they said.

Today, Oceanic Iron Ore. Corp., which now owns three iron-rich properties between Aupaluk and Kangirsuk, isn’t talking about the number of jobs that could some day arrive in Nunavik’s smallest community.

But its chief financial officer, Irfan Shariff, says “we’ve made some good progress.”

Oceanic is looking into the feasibility of a mine and a port, and it’s fast-tracked a preliminary economic assessment on the complex — due in October — to determine whether the mine wouldl be economically feasible.

Oceanic hired AMEC Limited and the FedNav Group to produce “a marine facility study” that will consider the future mine’s need for onshore infrastructure, port facilities and ocean transportation logistics.

Secor, an international strategic consulting firm, will produce an economic impact study to show officials in Quebec City and Nunavik how the mine’s development could dovetail with Plan Nord, Quebec’s 25-plan to promote mining and economic development in northern Quebec.

This summer Oceanic is sinking more that $12 million into drilling and other exploration activities to get a better idea of the size of the iron deposits.

“There’s no doubt that iron ore exists,” Shariff said — but no one is sure how much.

Aupaluk is located at the northern reaches of the Labrador Trough, which is so rich in iron deposits that the presence of iron in the soil is visible even to the untrained eye. The meaning of Aupaluk’s name in Inuttitut refers to the reddish colour of its soil.

In the 1960s, an iron mine closed down not far from the location of the original community of Aupaluk.

Then, during negotiations leading up to the James Bay and Northern Quebec Agreement in 1975, Quebec wanted to reserve the mine site as “category three” lands, where there could be mining.

Oceanic’s goal now is to pinpoint a billion tonnes of iron ore with a grade between 30 and 35 per cent by the end of 2011 — although past exploration shows there could be as much as 2.6 billion tonnes of iron ore on Oceanic’s properties.

The iron deposits range from the Roberts Lake area north of Kangirsuk to the Morgan Lake area, about 50 kilometres from both villages, to Hopes Advance Bay in the south, which lies only 10 km from Aupaluk.

Oceanic plans to mine Hopes Advance first.

As for the cost of a mine, whatever its size, the capital investment to build all the infrastructure required will be “significant,” Shariff said.

But the benefit is that the company doesn’t have to build a railway, like the one in store for the Mary River project, if it moves ahead.

After Oceanic receives its preliminary economic assessment, the Vancouver-based company will make a decision on whether to move ahead with the project, which could change Aupaluk’s future.

To finance the mine’s infrastructure, Oceanic may partner with European, Indian, Middle Eastern or Chinese steel mills or “go it alone.”