First-half mine openings, closings in near-balance

Among the trends that can be traced through this mining year is a significant rise in the number of gold operations reopened and base metal mines suspended (see Table 1) as of July 1.

With 16 openings and 17 closures expected in 1993, there is a near-balance for the first time since the beginning of 1990.

Nearly all gold mine openings and reopenings, as well as gold mine closures and suspensions, are expected to occur in Quebec and Ontario. Most base metal closures and suspensions will likely occur in Manitoba and the Yukon (see Table 2).

During the first half of 1993, eight mines opened and the same number closed. One new gold mine came on-stream and seven mines reopened — four gold, one base metal and two coal. During the same period, one gold mine and one copper-zinc mine closed; another two gold mines and four base-metal (lead-zinc and zinc-copper) mines suspended operations.

In the second half of 1993, eight openings and nine closures are expected. The openings include a new palladium-platinum mine, a new gold tailings operation and six gold mine reopenings. Two gold and five base metal mines are scheduled to close, and a copper and a nickel-copper operation are expected to suspend operations.

As a result of persistently low base metal prices and high world base metal inventories, it is unlikely any new base metal mines will be opened. Nor is it likely that any old ones will be reactivated before the end of 1993 (although several were scheduled to do so). There have already been postponements and delays in new base metal mine openings and reopenings. In contrast, still other gold mines may reopen before year-end, because of the improvement in the price of gold since April (and barring a significant drop in the price for the remainder of 1993).

All closures in 1993 will result from ore depletion whereas most mine suspensions are likely to be due to low metal prices.

From a regional perspective, in 1993, five provinces and the Yukon were affected by openings and closures (see Table 2). The Bathurst area of northern New Brunswick is expected to see permanent closure of one base metal operation. With six openings (four gold, one platinum metals and one base metal) and two suspensions (one gold and one base metal), Ontario is expected to fare best among the provinces and territories. With six openings (all gold) and five closures (three gold and two base metal), the decline in mine openings in northwestern Quebec that began in the second half of 1989 has finally halted. With four openings (two gold and two coal) and three suspensions (one gold and two base metal), British Columbia also halted its decline in mine openings, which began in 1990. However, with the suspension of all three base metal mines in the Yukon, and the expected closures of three more in the Flin Flon-Snow Lake region of northern Manitoba, and no mine openings expected before year-end, both these regions will be the hardest-hit mining areas in 1993.

This year, new and reopened mines will add 49,300 tonnes of daily ore production capacity and more than 2,260 jobs, while mine closures and suspensions will remove 63,700 tonnes of daily capacity and some 2,400 jobs, resulting in net losses of 14,400 tonnes of daily capacity and 140 jobs — the smallest annual net losses since 1989. Some 80% of the capacity losses and 45% of the employment losses resulting from mine closures and suspensions were related to mine suspensions. In contrast, only 10% of the capacity gains and 5% of the employment gains due to new and reopened mines were from new operations.

The largest mines contributing to capacity and employment gains are the Copper Rand gold-copper mine in Quebec and the Elkview (formerly Balmer) and Greenhills coal mines in southeastern British Columbia. The most significant contributors to losses are the Similco copper mine in British Columbia and the Faro and Vangorda zinc-lead-silver mines in the Yukon.

The most important expansion programs announced in 1993 were in Ontario and British Columbia. These are: (1) the mine reopening and expansion program at Inco’s (TSE) Garson nickel-copper mine at Sudbury, Ont.; (2) the expansion plan for Placer Dome’s (TSE) Dome gold mine in Timmins, Ont.; and (3) the expansion plan for the Gibraltar copper mine of Gibraltar Mines (TSE) in British Columbia. Gibraltar is planning a major expansion at its McLeese Lake open-pit operation, to raise copper production by 49% to 105 million lb. by 1996, and thereby reduce operating costs. Mill expansion is to be completed in 1995. Major expansions at Lac Minerals’ (TSE) Est-Malartic gold mill and its Bousquet No. 2 gold mine, which started in 1989, both near Malartic, Que., are now near completion. An expansion program at Inco’s Birchtree nickel-copper mine at Thompson, Man., will continue throughout 1993. Expansion is also continuing at Deak Resources’ (TSE) 3-circuit Kerr mill, which, in addition to treating ore from the company’s Kerr and Astoria gold mines, custom-mills ore from several nearby mines. The Quinsam coal mine at Campbell River, B.C., which doubled its coal production in 1992, will increase production to 600,000 tonnes in 1993, up from 500,000 tonnes in 1992. The company’s latest plan is to increase production further, to one million tonnes annually by 1994.

— Lo-Sun Jen is a mineral economist with the mining sector of the Department of Natural Resources Canada.

Table 2. Mine openings and closures in Canada

in 1993, by province.

OPENINGS REOPENINGS SUSPENSIONS CLOSURES

New Brunswick 1

Quebec 1 5 5

Ontario 1 5 2

Manitoba 3

British Columbia 1 3 3

Yukon 3

Total 3 13 8 9

Table 1. Mine openings and closures in Canada

in 1993, by commodity type.

COMMODITY NEW

TYPE MINES REOPENINGS SUSPENSIONS CLOSURES

Precious metal 3 10 2 3

Base metal — 1 6 6

Other commodities — 2 — —

Total 3 13 8 9