Construction to start this winter on $40-million site

Miramar Mining Corp. finally has a water licence to operate its Doris North gold mine near Cambridge Bay, after the minister of Northern Affairs, Chuck Strahl, gave his approval Nov. 6.

Construction of the $40 million open-pit mine is to start this winter. The company hopes to open the mine by late 2008. About 150 jobs are expected to be created.

The small mine will likely operate for only two years. But Miramar hopes to use profits to exploit more deposits along 60 kilometres of the mineral-rich Hope Bay.

Nunavut's mining boom got off to a false start when Tahera Diamond Corp.'s Jericho mine opened in August 2006, accompanied by a visit by the prime minister. Since then the company stock has plummeted as Tahera continues to produce disappointing diamond yields.

Investors see more promise in gold. Miramar has been offered a $1.5 billion buy-out by Newmont, one of the largest gold producers on the planet.

And elsewhere in Nunavut, Agnico-Eagle's Meadowbank gold project near Baker Lake is expected to open in 2010.

Besides having the distinction of soon being Nunavut's first gold mine, Doris North has also raised plenty of questions concerning the state of Nunavut's dysfunctional regulatory system.

Critics have charged Doris North received a "rubber stamp" from the Nunavut Water Board, after the Kitikmeot Inuit Association, hungry for jobs, leaned on regulators to ensure the mine received speedy approval.

The mine has been tangled in red tape since 2002. When the water board rejected an application from Miramar in December 2006, citing numerous technical objections, the KIA lashed out with a letter signed by its president, Donald Havioyak. The letter, written in late February, slammed the board's decision as "both unprecedented and unnecessary."

In March the board fired Philippe di Pizzo, who had served as its executive director for the last decade, shortly after reviewing the letter.

By April, the board's entire technical staff resigned in protest. Di Pizzo and some of his former staff now work for the NWT's water board in Yellowknife.