While there were no mine openings in Quebec in 2000, the industry could draw some cheer from the startup, in the latter half of the year, of two major metallurgical plants.
In October, just 32 months after a ground-turning ceremony,
By the end of 2001, the new facility, which employs 700 people, is scheduled to reach its full annual output rate of 400,000 tonnes of primary aluminum.
Alcan completed its mega-merger with Zurich-based Alusuisse Group in late October and now has a market capitalization of US$12.4-billion, 53,000 employees in 37 countries and holdings in nine bauxite mines, eight alumina refineries, and interests in 15 aluminum smelters with a total of 2.2 million tonnes of smelting capacity.
The new Alcan is divided into four business groups: Primary Metal, based in Montreal; Aluminum Fabrication (Europe), based in Zurich; Aluminum Fabrication (Americas and Asia), based in Cleveland, Ohio; and Global Packaging, based in Zurich.
The province’s second major launch occurred in October in the town of Asbestos in the Eastern Townships, where
Magnola produces magnesium metal from serpentine tailings using a proprietary method that was developed at a cost of $68 million at Noranda’s Technology Centre, near Montreal.
When full production capacity is reached, Magnola will be churning out 63,000 tonnes of magnesium metal annually.
The plant, which gives permanent jobs to some 320 people, is 80%-owned and operated by Noranda. Government-owned Socit gnrale de financement holds the remainder.
Noranda had two more notable successes in the province over the past year: First, its Bell Allard zinc-copper mine, near Matagami, reached commercial production rates, replacing production from the Heath Steele mine in New Brunswick, which was closed in the fourth quarter of 1999 following depletion of its reserves. Second, Noranda completed a $124-million upgrading of its CCR copper and precious metals refinery in Montreal. The project was designed to increase productivity, improve the plant environment and reduce unit costs.
Beyond these two world-leading companies, the mining scene in Quebec was fairly bleak, as was perhaps best illustrated by the slow-motion implosion of
The miner was forced into an extensive — and still ongoing — restructuring after it racked up US$33 million in hedging losses when gold prices briefly rallied in October 1999. Cambior entered 2000 with a whopping US$212 million of debt.
Smelling blood, Toronto-based junior copper producer
Wanting to keep their day jobs, Cambior officers strenuously objected to the deal and managed to thwart the offer. Instead, Cambior held a year-long garage sale that served to unbundle most of its key non-gold assets.
In March, Cambior sold its Bouchard-Hbert and Langlois zinc-copper mines in northwestern Quebec to Toronto-based zinc miner
In April, Cambior withdrew from its joint venture with junior
Soon after that, Cambior was thrown a lifeline by the Japanese investment company Jipangu, which privately placed US$5 million in shares and warrants.
Cerro San Pedro
In May, Cambior unloaded its Mexican assets on Reno-based
Glamis also gained the early-stage Santo Nino prospect, in Chihuahua state, a half-interest in the large Metates gold resource in Durango state, assorted joint ventures with
In June, Cambior took out a minimum US$13-million mortgage on its Niobec niobium mine in Chicoutimi. At the time, the mine was equally owned by Cambior and
La Granja
In September, in Cambior’s last big deal of the year, Billiton secured the right to buy Cambior’s majority interest in the La Granja copper property in Peru for US$35 million. Billiton is paying another US$15 million to state-owned Empresa Minera del Peru for a royalty.
Cambior acquired the property, 220 km northeast of Chiclayo, in 1994. It advanced the property through a final feasibility study, spending close to US$60 million. The deposit contains a measured and indicated resource of 2.56 billion tonnes of oxide and sulphide mineralization averaging 0.61% copper, based on a cutoff grade of 0.41% copper.
The sale of La Granja, scheduled for completion in early December, is designed to reduce Cambior’s debt to US$129 million, not including cash holdings of US$10 million.
Meanwhile back in the Abitibi, several junior gold miners had strong success in expanding reserves in spite of shrinking profit margins caused by the chronically low gold price.
Agnico-Eagle
Underground drilling by
And after beginning work in 1996, the company finally completed the sinking of its no. 3 shaft (renamed the Penna shaft, in honour of former president Paul Penna) in 2000, reaching a depth of 2,259 metres. For the moment, it is the deepest mine shaft in the Western Hemisphere.
In October, underground production at LaRonde was ramped up to 4,535 tonnes (5,000 tons) per day, and the mill was modified to accommodate the increase. Recovery rates are in the neighbourhood of 90% for gold, 80% for zinc and below 60% for copper.
Val d’Or-based
In mid-summer, McWatters completed two deals that provided the company with US$27 million in long-term financing. A portion was used to expand the mill at Sigma-Lamaque to 3,000 from 2,000 tonnes per day. A further expansion to 4,000 tonnes is planned for 2001.
A re-thinking of the style of mineralization at Sigma-Lamaque resulted in the swelling of the resource base to 1.8 million contained ounces from 392,000 oz. in late 1999. Resources rose to 18 million tonnes grading 3.05 grams gold per tonne from 3.8 million tonnes of 3.28 grams gold.
Kiena
At its nearby Kiena gold mine, McWatters put a resource figure on a new zone of gold-bearing carbonate veins northeast of current mine workings. The new zone, named NE Dilational, holds resources of 971,000 tonnes grading 4 grams gold per tonne — a grade consistent with the reserves in Kiena’s S-50 and North zones.
In spring 2000,
Aurizon bought the closed mine from
The biggest casualty in 2000 among juniors was
Mining had resumed early in 2000, after a shutdown in November 1999, and the mining method was modified from shrinkage stoping to cut-and-fill, with about $3.6 million spent on underground development in early 2000.
The company had once forecast production of 60,000 oz. gold in 2000 and 90,000 oz. gold (at a cash production cost of US$220 per oz.) in 2001.
Niobec mine
The year closed with industrial-minerals junior
The Quebec City-based company has agreed to pay $40 million for a 50% interest in the mine and another $7 million for Teck’s share of Niobec’s working capital. Mazarin will assume Teck’s role as mine operator, while co-owner Cambior carries on marketing the niobium.
This summer, Cambior and Teck completed a $7-million expansion of the concentrator at Niobec, boosting capacity by about 20%. Today, the mine remains North America’s only producer of ferroniobium, ranking a distant third in size globally behind two large Brazilian open-pit mines.
In a side deal, Mazarin has agreed to pay $3 million for Teck’s option on a 25% interest in
At the governmental level, the year 2000 was the first year of Corem, a mineral research consortium related to the government’s Centre de recherche minerale (CRM), in Ste-Foy.
Quebec’s Ministry of Natural Resources joined with several mining companies to create Corem. Partners include: Agnico-Eagle, Barrick, Cambior, Canadian Salt Co., Falconbridge, Inmet Mining, Iron Ore Co. of Canada, McWatters, Noranda, QIT-Fer et Titane, and Quebec-Cartier Mining.
Corem is now carrying out CRM’s primary research into mineralogy, assaying, processing and environmental management.
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