Recent project rejections call into question both the system and the understanding of that system by British Columbia’s mining companies. If these rejections stand, a great deal of money has been wasted.
The most recent problem arose this week, on September 25. Imperial Metals reports that the Federal Court of Canada ruled that the Federal environmental assessment of the Red Chris project was procedurally incorrect and should have been carried out by way of a comprehensive study review and not as a screening level review. The Court found the Department of Fisheries and Oceans and Natural Resources Canada, as the ‘Responsible Authorities’ did not have the authority under the Canadian Environmental Assessment Act (CEAA), to re-scope the project to a screening level review after the Responsible Authorities had determined they would proceed by comprehensive study review.
The judgment sets aside the Federal environmental assessment completed in May 2006 which determined the Red Chris project was not likely to cause significant adverse environmental effects. As a result of this judgment, the Responsible Authorities will be required to revisit the environmental assessment of the project under CEAA.
The decision of the Federal Court does not affect the Environmental Assessment Certificate issued by the Province of British Columbia in August 2005 following a thorough environmental assessment that concluded the Red Chris Project is not likely to cause significant adverse impacts.
Imperial says it “sees this decision as a setback for environmental review of projects in Canada by significantly limiting the ability of Federal and Provincial authorities to harmonize their respective review processes and avoid costly duplication and uncertainty. The company will be conferring with the Responsible Authorities to determine how they wish to proceed.”
Imperial acquired bcMetals Corporation in February 2007 at a cost of about $68.4 million. bcMetals’ main asset was the Red Chris property, located in northwest British Columbia, 18 km southeast of the village of Iskut and 80 km south of Dease Lake on the north facing Todagin Plateau. The Red Chris project had received Federal and Provincial environmental approvals for mine development. A 2004 feasibility study on the property indicates a 25 year mine life at 30,000 t/d with reserves of 276 Mt grading 0.349% Cu and 0.266 g/t Au.
Not long ago, Northgate had its plans to develop a second pit to the north of its existing Kemess Mine, located more than 400 km northwest of Prince George, rejected. Northgate was proposing to dump its tailings beneath a local lake, and that seems to have been the major stumbling block. The Kemess North project is of significant importance to Northgate because it has the potential to increase the productive life of its existing infrastructure by over 11 years. Since 2000, Northgate has invested almost $8 million in exploration and development to expand its resources base by over 800%. On the basis of a feasibility study completed in the third quarter of 2004, Northgate moved 4 Moz of the resources at Kemess North into the Proven and Probable reserve category.
Northgate reported on September 17 that the Panel was “satisfied, taking into account its commitments and proposed mitigation and compensation measures, that the project would not likely result in significant adverse environmental effects. The panel also concludes that Duncan (Amazay) Lake is the only waste disposal alternative which is environmentally effective, and technically and economically feasible. In spite of these conclusions, the panel has recommended to the Federal and Provincial Ministers of the Environment that the project not be approved as proposed, but also acknowledges that the Ministers could disagree with the Panel’s advice and approve the Project. Over the next several days, Northgate will be reviewing the details of the report and speaking with the federal and provincial authorities in order to more fully understand the Panel’s decision and determine how to proceed.
