Agnico Eagle cautiously optimistic about second Nunavut gold mine – by David Murphy (Nunatsiaq News – April 10, 2014)

“Feasibility and permitting are really the critical part for us now”

Depending on gold prices, the approval of certain permits and the results of a feasibility study due later this year, the prospects for Agnico Eagle’s Meliadine gold mine project are looking good, a company manager said April 8.

“I believe very strongly that the project will move forward,” Nancy Guay, Meliadine’s general program manager, said during a project update session at the Nunavut Mining Symposium in Iqaluit April 8.

Last year, Agnico Eagle slashed $80 million from the project’s capital budget, leaving just $45 million to spend in 2014. Gold prices slumped in 2013 to about $1,300 an ounce and the company coped with one-time problems at its Kittila mine in Finland and at other projects.

The price of gold has improved a little this year. As of April 8, gold was listed at $1,428 per ounce on But at another April 8 presentation at the mining symposium, Scotiabank’s commodity specialist, Patricia Mohr, said she expects gold prices to settle in at around $1,350 per ounce by 2015.

“It’s a question of commodity prices. Feasibility and permitting are really the critical part for us now,” Guay said.

A “big part” of Meliadine’s $45 million 2014 budget will go towards working on permits and completing a feasibility study, she said.

Guay said that if the project gets up and running, the mine will operate for 10 to 15 years at least.

“But we believe that it can be more than that,” she said.

That’s because the project’s mining camp stretches for nearly 80 kilometres, and much of the area is still under exploration.

A final environment impact assessment will be completed at the end of April, Guay said.

Then comes a final public hearing on the project, as well as a memorandum of understanding for an Inuit Impact and Benefits Agreement — both scheduled for August 2014.

The company hopes the Nunavut Impact Review Board will decide in September 2014 whether to give Meliadine the green light.

After that, the federal aboriginal affairs and northern development minister would likely issue a project certificate in early 2015 and construction of the mine could begin in the summer of 2016, Guay said.

That means the mine has the potential to replace revenue that will be lost when Agnico Eagle’s Meadowbank gold mine stops operating in 2018, Guay said.

“It is strategic to [Agnico Eagle Mine’s] overall plan that it replace the Meadowbank operation with another mine with a similar cash flow profile,” Guay said.

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