Uranium rush floods western Nunavut
Huge jump in price, demand has juniors racing to stake claims
Michael Gunning, president and CEO of Triex Minerals Corp., has all of the necessary licences and permits for a drilling exploration program outside Kugluktuk this spring, “so we’re off to the races, so to speak,” he says.
It’s an apt metaphor, because the Vancouver-based exploration company is just one of several junior mining companies rushing to find uranium in Nunavut.
“The last time we ran the mining symposium in Iqaluit [in 2004], there may have been a uranium company there, but not that I was aware of. In Rankin Inlet the next year, there were six uranium companies,” says a Government of Nunavut employee.
At the most recent Nunavut mining symposium, held in Cambridge Bay in March, uranium was on the agenda – so much so that one mining executive who attended referred to the event as “a two-day convention focused on uranium.”
Five years ago, uranium was worth about $7 per pound. Today, it’s worth about $42 a pound – a six-fold increase.
As politicians and countries grow more concerned about greenhouse gases produced by burning gas and oil, and countries grow more accepting, or apathetic, about nuclear power, the demand for nuclear fuel – uranium — will continue to rise.
That will only add to world demand.
Last year, western Nunavut saw at least eight uranium exploration projects, according to the Mining and Exploration Overview 2005 published by Indian and Northern Affairs Canada, and there appears to be even more activity planned this year.
Triex started their search in earnest in 2004. Last week, the company set up a camp at their Mountain Lake Deposit, 100 km southwest of Kugluktuk, where they plan to spend six to eight weeks, and $2.1 million, to find out just how much uranium exists on their eight mineral claims.
That uranium is there, they already know, because like other companies joining the scramble, Triex is exploring a site that was discovered back in the 1970s, when uranium was a hot commodity in great demand as fuel for the CANDU nuclear reactors that Canada was exporting around the world.
Mountain Lake is in the Hornby Bay basin in the Coronation Gulf, a site that is geologically similar to the Athabasca Basin in northern Saskatchewan, which holds the world’s richest and largest uranium deposits.
That explains why another company, called Hornby Bay Exploration Ltd., is also planning to further explore its claims in the area this year. They plan to spend about $6 million on exploration from April to September this year, said George Bell, the company’s president and CEO in Vancouver.
That work follows on a three-month exploration program Hornby launched in 2004, and continues the work from last year’s field camp, which housed about 38 geologists, geophysicists, helicopter pilots and camp staff at its peak.
Majescor Resources Inc. is another company on the hunt. They hold claims in the Thelon basin about 50 km just west of Baker Lake – another region that was already explored in the previous uranium boom.
They recently adjusted the number of their claims for uranium from 13 to 19, and are considering further exploration of the Kiggavik uranium deposit.
Titan Uranium is also hunting. They went public in June last year. This summer, they plan to drill on eight mineral claims in the Thelon basin near Aberdeen lake northwest of Baker Lake.
Philip E. Olson, Titan’s president in Saskatchewan, is aware that the uranium scramble is running at a fast pace, and in his case, near a community that defiantly opposed uranium mining in the early 1990s.
“We want to make sure that we’re moving at a pace that is not too intimidating to the people of the region,” he said. “It’s obviously got to be a bit of a cultural shock.”
At the exploration stage, there are no rules that require Titan to consult with the community, but all three mining executives interviewed for this article said they had met with community leaders and elders, in part to avoid trampling areas of cultural significance.
Both Hornby Bay and Triex report warm relations with hamlet representatives in Kugluktuk, and with the handful of local Inuit they’ve hired to work in their exploration camps.
Titan’s Olson said he received a warm welcome from Baker Lake mayor David Aksawnee and the hamlet council during a visit last summer, all of whom recognized the need for economic development.
“When we walked around and talked to people on the street, we really saw in Baker Lake that people were looking for work,” Olson said.
The urgent need for economic development makes Nunavut a more welcoming place for miners than it was when 90 per cent of community members in Baker Lake voted against a proposed uranium mine in 1990.
The jobs look likely to appear if the demand for uranium continues to rise, as it has recently.
As of January, there were 441 nuclear power plants in 31 countries around the world, which consume about 170 million pounds of uranium per year, even though the world’s uranium mines produce only about 100 million pounds of uranium per year.
While high prices fuel exploration, there is no guarantee it will lead to any mines. A typical permitting process can take nine to 20 years, and even then, there is no guarantee a mine will go ahead.
Uranium is a radioactive mineral used for fuel in nuclear reactors, and in nuclear bombs. In Canada, it is closely regulated by the federal government.
The Government of Nunavut is working on an exploration and mining policy, which Olayuk Akesuk, as minister responsible for mines, has promised to deliver before the next session of the legislature.
That strategy, however, contains no special provisions for uranium mining or exploration, said the director of minerals and petroleum, Gordon Mackay.