Tulsequah mine's opening plans revived
The Tulsequah Chief mining site in northwestern British Columbia may be on track towards a mine opening there, thanks to a new owner.
Work on the copper-gold-zinc-lead-silver underground mining project, located 120 kilometres southwest of Atlin, B.C., was halted in December 2008 by its previous owner, Redfern Resources Ltd., as the result of the global financial crisis.
Facing $175 million in debt, about $91 million of which was tied up in the failed asset-backed commercial paper market, Redfern filed for creditor protection months later.
Redfern ex-president Terry Chandler teamed up with new partners, creating Chieftain Metals Inc., this past fall. The new company purchased the Tulsequah Chief site out of bankruptcy and now owns it debt-free, Chandler told CBC News.
Fontaine on company's board
Toronto-based Chieftain boasts Phil Fontaine, former grand chief of the Assembly of First Nations, as one of its prominent board members.
Chandler said he hopes Fontaine will help the company navigate the turbulent political landscape as it tries to obtain the necessary permits and financing to open a mine.
"Obviously, Phil Fontaine brings a wealth of experience," Chandler, who is Chieftain's executive vice-president, said in an interview.
"We haven't yet had an opportunity to really advance discussions with the [Taku River Tlingit] First Nation, but we're hoping that that will happen later this year."
Chieftain's other board members include Raymond Mah, chief operating officer of Yukon Zinc Corp., which owns the Wolverine zinc mine in Yukon.
The Tulsequah property includes two previously producing mines, the Tulsequah Chief deposit and the Big Bull deposit. Those sites operated between 1951 and 1957, according to Chieftain's website.
Barge proposal under review
The Tulsequah Chief project sparked controversy when environmental groups and the Taku River Tlingit First Nation opposed Redfern's plan to build a 160-kilometre access road through the northern B.C. wilderness from Atlin to the mine site.
The company instead proposed to use an air-cushioned river barge, pulled by a tugboat, to haul supplies and ore along the Taku River, which flows into Alaska.
But the barge proposal raised more concerns about the potential impacts on salmon in the river.
"We are back to the drawing board looking at the access. Certainly there are some some difficulties associated with barging, and it isn't the solution that some people thought it would be," Chandler said.
"There are problems, both operational and environmental … so that has to be looked at hard in this part of this exercise over the next year."
Meanwhile, the new company is obligated to clean up the Tulsequah Chief site, which has been leaking pollutants into the Tulsequah River. Chandler said the company plans to build a $5-million water treatment plant this summer.
"It's going be a fair amount of expense, but we hope that we could have it operational by late fall of 2011," he said.
If all goes as planned for the new company, Chandler said it will be looking for construction financing next year.