Sabina wants Bennett to delay response to Nunavut board’s gold mine report

This map shows the location of Sabina’s proposed Back River gold project. (FILE IMAGE)

The Sabina Gold and Silver Corp. wants Carolyn Bennett, the minister of Indigenous and Northern Affairs, to give them more time to respond to the Nunavut Impact Review Board’s recommendation that their Back River gold project not be allowed to proceed right now.

Sabina’s president and CEO, Bruce McLeod, sent that message to Bennett in a letter dated June 16, saying they need more time to study the NIRB’s 347-page report.

“We are writing to respectfully request that you defer any decision in response to the report until we have had a chance to review the report in detail, to determine if we wish to make any submissions to you in response to the report,” McLeod said in the letter.

That’s because one option the company is looking at — described in a Sabina news release aimed at shareholders — is to ask Bennett to hand the report back to the NIRB “for further consideration.”

“The report is over 300 pages long and it will take some time for us to review and analyze the report in detail,” McLeod said in the company news release.

Following news of NIRB’s recommendation, the company’s stock price — which stood at $1.73 at the TSX close of trading June 15 — fell 34.6 per cent to $1.13 by 4 p.m. June 16.

This past May 20, Sabina had sold $32 million worth of shares to a group of investment banks at $1.63 to raise cash to pay for further development of the project, including costs associated with a water licence application to the Nunavut Water Board.

But without a positive recommendation from the NIRB, or an intervention by the INAC minister, it’s unlikely that further licencing or permitting of the project can occur.

Article 12 of the Nunavut Land Claims Agreement contains two sections that give the INAC minister the power to either reject a public hearing report or ask for more work to be done on it, in cases where NIRB recommends a project not proceed.

One section, 12.5.7(d), says the federal minister may reject a NIRB recommendation if the government deems the project to be in the national or regional interest.

Another section, 12.5.7(e) says that when a NIRB report is “deficient with respect to ecosystemic and socio-economic issues,” the minister may refer the report back to NIRB for further review or more public hearings.

Although NIRB recommendations are highly influential, the Nunavut Land Claims Agreement is designed to ensure that government ministers get the ultimate power to decide if any given project should or should not proceed.

In its 347-page final hearing report, the Nunavut board said Sabina’s Back River gold project could potentially produce ecosystemic and socio-economic impacts that cannot be mitigated.

And they said the dangers posed to the region’s dwindling caribou herds, and other species, combined with the effects of climate change, create too much uncertainty.

To that end, the NIRB recommended the project should not proceed “at this time.”

But they also said Sabina would be free to resubmit a project proposal if in the future there is “increased certainty regarding effects, predictions and mitigation measures.”

McLeod seized on that in Sabina’s company press release.

“We remain confident that the concerns of the Board can be addressed and resolved through further consultation and collaboration with stakeholders,” McLeod said.

McLeod also said the company received “broad support” from the Kitikmeot Inuit Association, Kitikmeot communities and federal and territorial government agencies” and support for the economic benefits the project might produce.

But at the public hearing and community roundtable held April 25 to April 30 in Cambridge Bay, many stakeholders, including the governments of Nunavut and the Northwest Territories, raised questions about the company’s ability to mitigate damage to caribou.

And the NIRB questioned whether Sabina has the financial capacity to “to bring the Project forward in a manner that reflects all of the commitments made as well as continuing to fulfill the mitigation, monitoring, and “adaptive management that would have been required to carry out the Project.”

McLeod said, however, that the company will consider the project’s environmental issues carefully when it reviews NIRB’s report.

“We fully appreciate the central importance of caribou in the North,” McLeod said.

“Obviously, climate change is a matter that impacts everyone, and northern Canada is more heavily impacted than other places. These are values and concerns we share,” he said.

Sabina hoped to produced about 200,000 ounces of gold per year for about 11 years by operating a chain of open pit and underground mines at its Goose property, located 400 kilometres south of Cambridge Bay and 520 km north of Yellowknife.

That would have required an initial investment of $415 million, the company said.

In an earlier decision, the NIRB on June 13 recommended approval of TMAC Resources Inc.’s Doris North gold project.

Sabina letter to INAC minister Carolyn Bennett by NunatsiaqNews