By Darren Campbell -- Long considered a pariah, uranium mining is back in vogue and Nunavut’s Kivalliq region is an industry hot spot. Mining companies and the political leadership are keen to cash in on the potential. But concerns about the safety of uranium mining actually may stop the boom before it starts.
Deep in the Canadian Shield, 700 kilometres north of Saskatoon and about 150 metres below ground level, a giant backhoe greedily scoops up ore that’s been blasted loose from an open pit and drops it into the back of a 100-tonne truck, filling its vast holding area in three minutes. Once loaded, the truck winds its way up a circular road to the top of the pit and disappears, headed to an ore processing mill, 14 kilometres away.
The digging and hauling of rock and ore never stops at the McLean Lake uranium mine. The trucks come and go, hour after hour, day after day at this remote spot in northern Saskatchewan. McLean Lake is at the eastern edge of the Athabasca River Basin, home to the richest uranium deposits in the world. And because the end product from mines like McLean Lake – U3O8 (commonly known as yellowcake) – is processed for use as fuel in emission-free nuclear reactors, this endless blasting, digging and hauling could be repeated someday on some yet-unspoiled Nunavut tundra.
For not only is northern Saskatchewan uranium rich, so too are parts of Nunavut – particularly the Kivalliq region where several sedimentary basins are geologically similar to the Athabasca. The mining industry has known this for some time, but with uranium fetching less than $20 (U.S.) per pound until five years ago, and with few nuclear reactors being built, there wasn’t much interest in opening a uranium mine in Nunavut.
The political climate didn’t help, either. A proposed uranium mine near the Kivalliq community of Baker Lake was shot down by a community plebiscite in 1990 and Nunavut Tunngavik Inc. – the organization that owns and administers Inuit lands under the Nunavut Land Claims Agreement – banned uranium mining shortly after that.
But times have changed and so have attitudes in Nunavut. The price per pound of uranium on the spot market shot up to just under $140 (U.S.) in 2007 (it’s now just over $40) and NTI reversed its mining ban that same year. Couple those factors with a host of nuclear reactors being built around the world and it’s clear why companies have cozied up to Inuit organizations, exploring or proposing to explore for uranium in Nunavut. And one company, Areva Resources Canada Inc., is even further along, proposing to build a mine on the same property rejected by Baker Lake residents almost two decades ago.
The steady work and well-paying jobs uranium mining could bring are tempting in a region where the seven communities have unemployment rates as high as 70 per cent. But the industry’s return has also aroused old fears that exploration and mining for uranium will harm the caribou, the land, the water and the people who would work at the mines or live near them. And those concerns could stop the territory’s uranium boom before it gets started.
“I’ll give you a stat,” says Rob Carpenter, president of Vancouver-based Kivalliq Energy Corporation. “Approximately one in 3,000 exploration projects becomes a mine.” Despite the long odds, Carpenter thinks he’s got a winner on his hands. The company’s prize possession is the Angilak property, a 100,000-hectare parcel of land 80 kilometres west of Baker Lake. According to old geological work done by a mining junior called Aberford Resources, Angilak contains 11.6 million pounds of uranium with grades averaging a healthy 1.03 per cent.
However, the work was done before rigorous geological reporting standards were introduced, following the Bre-X Minerals scandal of 1997. So Kivalliq Energy has to prove that what Aberford said was there is in fact there. “If we can prove the deposit is that good, our deposit at one per cent average grade would be a considerably high grade,” Carpenter says. Perhaps even high enough to justify building a mine.
But Kivalliq’s work is just beginning. In 2008 the company spent $2.2-million on Angilak, mostly examining old drill cores and mapping, prospecting and sampling ground geophysics. This summer it plans to drill on site to prove it has a resource big enough to make a mine worthwhile, although Carpenter stresses that’s a long way off. “We need to prove the geology, then go through an environmental assessment, then sign impact benefits agreements and then have the construction phase. I’ve never been involved in a project that went from scratch to a mine and didn’t take at least a decade.”
So a mine isn’t imminent for Kivalliq Energy. But what makes the company notable, besides the potentially sizeable uranium resource it holds, is its business partner, NTI. The company is the first in Canada to sign an agreement with NTI for the right to explore and potentially mine uranium on Inuit-owned lands. To acquire those rights, NTI got a million shares in Kivalliq Energy, and should the company complete a feasibility study on any portion of the Angilak property, NTI has the right to claim either a 25 per cent participating interest or a 7.5 per cent net profit royalty on any resulting mine.
And there could be more deals to come between NTI and uranium miners. In December, NTI signed a memorandum of understanding with Vancouver-based Forum Uranium Corp. The two organizations are now negotiating an exploration agreement for a 218,000 shectare parcel of land in the Kivalliq region.
These deals were made possible by NTI’s September 2007 decision to reverse its ban on uranium mining. The reversal made plenty of headlines and angered groups opposed to uranium mining. But the organization’s leadership says it reversed the ban partly because nuclear power could be a cleaner alternative to greenhouse gas emitting power sources.
There were financial considerations, too. NTI recognized the jobs, business opportunities and royalties that could flow to it and its beneficiaries from exploration and development.
The guiding principles of its policy are noble enough. Exploration and mining must be carried out in a way that doesn’t cause significant adverse effects on people, the environment or wildlife; Inuit must benefit; and the uranium must be used for peaceful and environmentally friendly purposes. “We’ve worked at this for a number of years,” NTI vice-president James Eetoolook says. “It’s a very touchy issue and we want to make sure we do it the right way.”
So what, exactly, is driving interest in exploring for and mining uranium in a high-cost Canadian hinterland? In two words, rising demand. The World Nuclear Association says there are now 436 nuclear power reactors in the world producing 372 gigawatts of power. But population increases and rising standards in living in the developing world will increase the demand for energy. The association estimates that by 2030, the world will need at least 550 gigawatts of nuclear energy capacity. Its high estimate is 1,200 gigawatts. Either way, the increase will require far more nuclear reactors and a corresponding increase in nuclear fuel.
Canada is already the world’s largest producer of uranium, providing about one-third of the total. In 2008, Canada produced 9,000 tonnes of uranium. All three of the country’s producing mines are in northern Saskatchewan, including Cameco Corporation’s McArthur River, the world’s largest uranium mine. But with the world needing more uranium and Canada being one of the few countries (Australia and Kazakhstan are the others) with the ability to increase its production, new mines will be needed. This is where the resources in Nunavut enter the picture.
Areva Resources Canada Inc.’s Kiggavik project – located 80 kilometres west of Baker Lake – could very well be one of those mines. The Canadian subsidiary of the French nuclear power giant, Areva, already knows what it has there. Continued ...
The company says the mine – if built – would produce 100 million pounds of uranium with an average grade of 0.3 per cent during its life, which is expected to be between 15 and 20 years. The company filed its mine project proposal with the Nunavut Impact Review Board in the fall of 2008. It is awaiting a recommendation from the regulator to Indian and Northern Affairs Minister Chuck Strahl as to whether the project will have to go through an environmental assessment.
Areva Resources’ point man in this journey is Barry McCallum, the company’s manager of Nunavut affairs. He says the company has big plans for the Kiggavik project. If the project gets regulatory approval, uranium will be taken from five sites; four of them open pits and one an underground operation. Kiggavik would also include all the other facilities one would expect at a mine – haul roads, an airstrip, accommodations for employees, warehouse and maintenance facilities, fuel tanks, water treatment plants, administration buildings and an ore mill. Amid the brutal cold of the long winters and the clouds of black flies during the all-too-short Kivalliq summers, the mine would produce between 2,000 and 4,000 tonnes of yellowcake a year.
Economically, the mine would be a boon for the Inuit that call Baker Lake and the Kivalliq home. Kiggavik would employ between 400 and 600 people from start to finish. At Areva’s mines in Saskatchewan, McCallum says the company has achieved 50 per cent Northern content and 85 per cent of those hires have been aboriginal.
McCallum expects the same percentages would be achieved at Kiggavik, and the Inuit who work there can expect wages of $80,000 a year plus holiday and overtime pay. The benefits would extend beyond the people working at the mine. Areva’s proposal says capital and operating expenditures over the mine’s lifetime will amount to several billion dollars and the proposal states, “There will be opportunities for existing businesses to expand, and for new businesses to form, in response to Project needs for goods and services.” If all goes well during the regulatory process, McCallum says construction could start as early as 2012 with production starting in 2015.
Those numbers seem to have impressed NTI, the Kivalliq Inuit Association and all seven hamlet councils, who are on board with Areva’s proposal and uranium mining in the Kivalliq in general. But one person who is not on board is Joan Scottie. And she says there are plenty more like her.
The Baker Lake resident has a long history with the Kiggavik project. Back in the late 1980s, a company called Urangeselleschaft Canada Ltd. was hot to develop Kiggavik. Scottie helped found the Baker Lake Concerned Citizens Committee to look into the issue and the community didn’t like what it heard. In a plebiscite held in March 1990, 90.2 per cent of voters came out against development of the Kiggavik mine.
Today, the committee Scottie helped found still exists and it’s still fighting uranium mining. But it’s operating in a different environment. Scottie says, in 1990, the committee was well funded by Inuit organizations, had an office and could afford to pay for experts who informed locals about the risks and rewards of uranium mining.
Twenty years later the funding isn’t there. She says requests to KIA for $5,000, so the committee can take part in the screening of the Areva proposal, have been ignored. Recently the committee was forced to make a last-minute request to the Baker Lake hamlet council for $1,000, so it could hold a public meeting to get feedback from young people, elders, and hunters about the proposed mine. The hamlet gave it the money.
Scottie says the lack of financial support is why opposition to Areva and other uranium exploration proposals is muted this time around. And Scottie feels it paints the inaccurate picture that most people in Baker Lake now support uranium mining. “People are not as informed as they were and if you don’t know anything, you’re not going to ask questions,” Scottie says. “But there are still lots of concerns.”
Chief among the concerns expressed at the meeting Scottie helped organize was the effect the mine would have on the Beverly and Qaminirjuaq caribou herds that frequent the region. In particular, the Beverly herd is in serious decline and although the Kiggavik site is 70 to 80 kilometres from the nearest calving grounds, there are worries that the noise from mining activities and potential contamination of water, soil and vegetation could deliver knockout blows to the caribou on which Inuit in the Kivalliq have depended for millennia.
The concerns don’t end there. Scottie says young and old are asking how waste – such as tailings, which include heavy metals, acids and radioactive materials that are produced after mined ore is crushed and milled into yellowcake – created at Kiggavik and other mines will be contained? And how can residents be sure the toxic tailings won’t seep it into the ecosystem, contaminating plants, wildlife and humans?
Areva’s Barry McCallum has heard those concerns. He points out uranium mining has gone on in northern Saskatchewan for 40 years without incident and all the modern measures the company takes to minimize environmental impacts there – the constant monitoring of radiation levels, the in-pit storage of tailings – will be used at Kiggavik. “In northern Saskatchewan, the environment has not been compromised. Worker health and safety has not been compromised. We’re going to make sure we do this right.”
Areva, Kivalliq Energy and other uranium mining companies also have no choice but to do it right. The health of the land and wildlife of the Kivalliq region hang in the balance. One mistake, one misstep by industry could make Nunavut’s gamble on uranium here a losing bet.
