Niocan soars on Oka approval

Shares in Montreal-based Niocan (NIO-T) jumped 25, or around 42%, to 85 in early afternoon trading in Toronto on June 18, after the Administrative Tribunal of Quebec approved the company’s Oka niobium project, about 40 km northwest of Montreal.

The tribunal’s decision followed a 32-day review of the project after a group of local residents voiced opposition to possible radioactivity and water-quality concerns.

The panel’s 156-page review found that the project does not “create a risk of contamination for the sector and its agricultural activities.” The decision also eliminates the need for a monitoring committee for the project, required under a previous decision by the Quebec Agricultural Land Protection Commission. Quebec’s Ministry of the Environment has yet to authorize the project.

Niocan also plans a $1.1-million program designed to train an estimated workforce of 160.

A 1999 feasibility study of Oka proposed mining 892,000 tonnes from underground annually, from which would be produced 4,500 tonnes of ferro-niobium. Capital costs were pegged at $90 million, with an internal rate of return of 15-20%. The study was based on 22,606 metres of drilling in 59 holes in the mid-1990s.

Proven and probable reserves in the main orebody, S-60, are estimated at 10.7 million tonnes grading 0.66% niobium pentoxide (down to 500 metres depth), while reserves in the secondary orebody, HWM-2, are pegged at 1.5 million tonnes of 0.56% niobium pentoxide (to 350 metres depth).