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Meadowbank plan languishes in bureaucratic limbo

Frustrated proponent warns cumbersome system could scare away investors

JIM BELL

Officials with Cumberland Resources Ltd. are ready to move on their lucrative Meadowbank gold mine proposal near Baker Lake, but can't act on their plans because a key document is languishing in bureaucratic limbo.

The document, called a "project description report," is now sitting with the Department of Fisheries and Oceans in Iqaluit.

"This isn't even the beginning of the process. We're still sitting in the waiting room waiting for our proposal to be officially received," said Craig Goodings, an environmental consultant from Vancouver on contract with Cumberland.

DFO officials are supposed to look at the project description, and send it to the Nunavut Planning Commission. NPC officials would then read it to ensure the proposal conforms to the Kivalliq region's land use plan, then send it to the Nunavut Impact Review Board. NIRB staff would also read it, and in turn send it to the DIAND minister with a recommendation on how to do an environmental review.

Only after that can the first bureaucratic process actually begin - the production of an environmental impact statement by the company, and an examination of it by a long of list of government departments, management boards and Inuit organizations.

Goodings says Cumberland thought this preliminary stage would take only three weeks. That's the advice the company got from NIRB, in a set of guidelines for developers.

But it's now mid-July, three months later, and Cumberland fears that its entire schedule could be thrown off by one year at least.

"A delay of only a week can set you back for a year. It doesn't seem like that's a common consideration for the regulators. It's come up again and again and again every time," Goodings said.

When Nunatsiaq News contacted the DFO for comment this week, Winston Fillatre, the acting area manager, was not able to offer any comment.

Fillatre said the two DFO employees who know the Meadowbank file are not in the office this week. One is on sick leave and the other is on vacation.

Goodings said, however, that an NPC official told him this week that NPC has yet to receive the Meadowbank project description from DFO.

Goodings warned that if Nunavut gets a reputation for having a cumbersome bureaucracy, global investors won't put their money into Nunavut mining projects.

Cumberland needs to receive a project certificate, and permits, before it can go to investment bankers in financial centres like Toronto, New York, Paris and London to raise the $200 million it needs to build the mine.

"To get that money we compete with all other mines all over the world in South America, Africa, Russia. These are sophisticated investors and they look at everything, not just how much gold you've got, but who the government is and what the bureaucrats are doing and how the other mines are doing," Goodings said.

One possible reason for the hold-up is an earlier misunderstanding between DFO and DIAND over which department should handle the Meadowbank project description. Goodings said a DFO employee apparently thought DIAND should handle it, and sat on the file.

"There was a misunderstanding, but it's been resolved," said Craig Stevens, DIAND's acting operations manager. "It's a complicated process and this was the first project in an area that has an approved land use plan. Everybody's sort of feeling their way along."

DIAND is not actually involved right now because the land that Meadowbank wants to use is Inuit-owned, administered by the Kivalliq Inuit Association, Stevens said. It's KIA who will eventually be responsible for issuing permits to the company.

NPC is involved because the Kivalliq is the only region in Nunavut with a land use plan.

DFO is involved because the mine would affect fish habitat. The Meadowbank project includes three open pits that extend over partially drained lakes.

Goodings said Cumberland is looking at a glorious opportunity for developing a mine at Meadowbank. The price of gold on world markets now stands at around $360 an ounce. Cumberland believes it can produce gold at Meadowbank for $168 an ounce.

"Right now, this is the time to strike. The investors love those kinds of numbers," Goodings said.

About $30 million has already been invested in exploration at the site, which lies about 70 km north of Baker Lake. This year, the company is spending $12 million on exploration, and 21 of the 44 employees at its camp are Inuit from Baker Lake, Arviat and Rankin Inlet.

But that is small change when compared with the money, jobs and business opportunities that could be generated within if the mine goes into production.

Goodings said about 300 people would be employed in construction of the mine, while the mine itself would employ about 250 people.

When prospectors first discovered the gold-bearing formation at Meadowbank in 1989, they were able to determine that at least a few hundred ounces of gold lay beneath the surface there.

Since 1995, when Cumberland took over the site, the company has proven that there are at least 3.5 million ounces of gold there, which it is hoping to raise to four million ounces by the end of this year's exploration season.

That's enough to keep a mine going for at least 10 years, and perhaps longer, Goodings said.

He said Cumberland has already held numerous community meetings, done traditional knowledge and other environmental studies, and feels that it has won the support of the community.

But as other mining industry people have been murmuring these days, Goodings said, Nunavut's promised mining boom could be lost if the territory gets a reputation for having an unreliable bureaucracy.

"We tell people that this is a great place to be, but we have to make sure that what we say is true, and that the bureaucracy doesn't just pile up on you and stop you from doing stuff for years and years and years, because otherwise the investors are going to go away and they won't come back for a long time," he said.

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