'It's a favourable political &#39c;limate;,' miner says

Mining-friendly Kitikmeot impresses Newmont

By JANE GEORGE

CAMBRIDGE BAY – During his one-day visit to Cambridge Bay last week, John Mudge wanted to see what his employer, the mining giant Newmont Mining Corp., had bought into.

Earlier this month Newmont, the second largest gold producer in the world, paid $1.5 billion for Miramar Mining Corp., the junior mining company that owned Doris North, a gold mine being developed 160 kilometres southwest of Cambridge Bay.

Mudge, who attended a community feast and visited Inuit organizations while in Cambridge Bay, said he was impressed by the positive attitude towards mining development.

"It's a favourable political climate," said Mudge, the regional director of environment and social responsibility for Newmont.

Mudge said he found the attitude towards mining in the Kitikmeot much different than in Peru, where Newmont has been embroiled in a series of political, environmental and social disputes for years.

In August 2006, Newmont had to shut down operations at its mine Yanacocha in northern Peru, the world's second-largest gold mine, when about 200 protesters blocked the main route to the site over an expansion project that they feared would affect water quality in streams and lakes.

In 2004, a class action lawsuit was filed in the United States against Newmont on behalf of 1,100 residents of a farming village where 332 pounds of mercury spilled from a truck subcontracted by Newmont in June 2000.

The residents, unaware of the dangers, collected the mercury and took it home, where they say it led to symptoms of acute mercury poisoning, from blindness to brain damage, heart defects, physical deformities and lesser ailments.

Critics of Newmont say the troubles started back in the 1990s when the Peruvian government gave the go-ahead to Minera Yanachoca, the joint-venture that operates the mine, after allegedly accepting bribes and without consulting with local communities.

Doris North received its water license Sept. 20, and Newmont hopes to have the mine operational by late 2008. With only a couple of minor permits still to be approved, Mudge said Doris North is nearly "100 per cent sure" to go into production – otherwise, Newmont wouldn't have paid $1.5 billion for Miramar's properties.

Mudge said Newmont also wants to make sure it has the informal "social license" to operate in the Kitikmeot.

To prepare for the busy season ahead at Doris North, Newmont is said to be negotiating the purchase of a Cambridge Bay triplex for company staff housing.

The Government of Nunavut decided not to lease the triplex, which had been built three years ago by the Kitikmeot Corp. to ensure housing for future health centre workers. A later GN offer to purchase the triplex fell apart when Newmont made the development corporation a better offer for the property.

During the intense two-year lifespan of Doris North, 150 workers will be mining gold underground. When mining starts at its larger Madrid property, several hundred more jobs are expected to open. Cambridge Bay, whose airport needs an $18 million upgrade, will serve as the transportation hub for Newmont.

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