Proposed legislation could restrict processing options for Diamond Fields

The government of Newfoundland and Labrador has introduced legislation that could compel Diamond Fields Resources (TSE) to process its ore within the province.

According to an explanatory note included with the bill, “the amendments to the Mineral Act being proposed would permit the government to require, as a condition of a mining lease, that a lessee complete primary production, in whole or in part, in the province, of minerals mined under the lease.” Diamond Fields does not yet have a mining lease, and Newfoundland and Labrador’s assistant deputy minister of Natural Resources, Paul Dean, says passage of the legislation could result in a condition for the in-province processing of ore being attached to Diamond Fields’ lease.

“In the past, the province has lost out on economic benefits because of processing taking place elsewhere,” he says, citing the example of Wabush Mines’ processing of iron ore in Sept Iles, Que.

“The government just wants to make sure that those things don’t happen again, but at the same time, it wants to be fair and reasonable about it.” Dean notes that New Brunswick has enacted similar legislation.

The legislation would provide companies with an opportunity to prove that out-of-province processing is necessary in order to make a given project economically feasible. In such cases, the minister may exempt the company from the new law.

He says the new law could be passed by Christmastime.

Hole Depth Interval Nickel Copper Cobalt

(m) (m) (%) (%) (%)

202 692.8-732.7 39.9 3.36 1.41 0.17

658.6-743.7 85.1 1.91 0.82 0.1

201 747.3-768.2 20.9 3.19 1.54 0.17

774.2-779.4 5.2 3.3 1.54 0.18

728.2-779.4 51.2 2.45 1.12 0.13

overall 655.1-779.4 124.3 1.36 0.61 0.06

199 656.2-684.0 27.7 1.77 0.56 0.07

714.0-723.0 9.0 1.74 0.68 0.09

overall 613.0-732.0 119.0 0.97 0.35 0.04