Manitoba to proclaim new mining legislation

In an effort to streamline its mining legislation and create an attractive investment climate in the province, the government of Manitoba is expected to proclaim a new Mines and Minerals Act in 1992.

This new mining legislation is the first, anywhere in Canada, to incorporate the principles of sustainable development.

An exploration incentive program is being offered in 1992 whereby investors can obtain a 25% grant for investments in approved exploration projects. This “flow-through” incentive targets new exploration activities by junior exploration companies.

After years of negotiations, Hudson Bay Mining and Smelting (TSE) and the governments of Canada and Manitoba have announced the $187 million environmental improvement program for the company’s metallurgical plant in Flin Flon. This long awaited development will revitalize base metal exploration in Manitoba, particularly in the prolific Flin Flon-Snow Lake district.

Plant improvements will reduce sulphur dioxide emissions by at least 25% and airborne particles by more than 50%, to comply with environmental legislation to take effect in 1994.

In addition, consumption of heavy oil and coal will be substantially reduced, and carbon dioxide emissions will be lowered by more than 300,000 tonnes per year. Construction during plant improvements will employ up to 230 people. A $10 million, equally shared, 5-year Mineral Development Agreement was formally signed between the federal and manitoba governments on June 28, 1991. The purpose of the agreement is to encourage mineral developments in Manitoba.

Manitoba Energy and Mines has created a marketing branch that is dedicated to promoting the development of the mineral resources of the province. To this end, marketing will work with the exploration and mining industries currently and potentially active in Manitoba, as well as the investment communities of Manitoba, the rest of Canada and the U.S.

Major mining and exploration companies continued to play a leading role in mineral exploration and development in the province in 1991 with an emphasis on base metals. Recent achievements in Manitoba include:

— Discovery of new, deep, high grade sulphide lenses at the Trout Lake Mine — Opening of the Callinan Mine

— Discovery of a base metal-bearing horizon at Leo Lake

— Outlining of the Chisel North deposit

— Production commencing from the West Anomaly deposit at the Ruttan Mine — The sulphide lens at MacBride Lake appearing to thicken at depth — Continued encouraging results from gold exploration at the Monument Bay project

— Despite softening of nickel prices, major capital works projects being conducted by Inco (TSE) at the Thompson operation

— Full production reached at Inco’s Open Pit South

— Active exploration on the southern extension of the Nickel Belt, under Paleozoic cover rocks.

Exploration expenditures have declined since the all time “flow-through” peak in 1987, but new initiatives by the government are designed to reverse this trend.

A more optimistic indicator of greater activity levels are the one million hectares of claims currently in good standing.

In the Flin Flon-Snow Lake belt, and its southern extension beneath the Paleozoic, major exploration efforts continued to be directed at base metals. At the Trout Lake Mine near Flin Flon, exploration drilling by HudBay and partners Granges (TSE) and Manitoba Mineral Resources (MMR) has been successful in the discovery of two new high grade zones, the HIO and Middle zones.

Recent Trout Lake drilling below the 560-metre level focussed mainly in the area of the No. 7 lens of the North zone where a hanging wall structure referred to as the No. 10 lens was encountered. To date, the best result reported from this lens comprises 45.5 metres of 2.47% copper, 9.8% zinc, 3.2 gold and 36.7 grams silver per tonne. HudBay and partners have agreed to develop a crosscut in the hanging wall to explore the deposit down to the 1100-metre level.

At the Callinan Mine just north of Flin Flon, underground exploration drilling continues to add new ore reserves at depth. The mine, put into production in April, 1990, is currently producing at a rate of about 45,000 tonnes per month.

Granges has encountered a complexly folded base metal-bearing horizon at Leo Lake, about 20 km east of Flin Flon. The average weighted grade of 21 core length intercepts is 4.0% copper and 2.7% zinc, with minor gold and silver credits over an estimated horizontal width of 3.6 metres. Mineralization is open in all directions, and the company claims that the possibility exists for a small, but economic base metal deposit. Exploration drilling is expected to continue in 1992.

In November, 1991, at the Manitoba Energy and Mines mineral activities forum, Granges credited the input by provincial mineral deposit geologists into the discovery of this deposit.

Minnova (TSE) completed a 5000-metre drill program at the Big Island property. Although exploration for a faulted extension of the Westfield high grade polymetallic deposit has thus far proven unsuccessful, the property still has potential to contain such an extension.

In the Snow Lake area, HudBay continued to drill in the Chisel Lake area throughout most of 1991. Reserves for Chisel North in late 1990 were in excess of 2.7 million tonnes grading 9.0% zinc and 0.17% copper. In the Dyce Lake-North Moose Lake area, partners Teck (TSE), Consolidated Samarkand Resources (VSE) and TSA Explorations (VSE) completed line cutting, geophysical and diamond drilling on their permit. Recently, the large permit area was reduced in size by claim-staking, and additional drilling is expected in 1992.

Other base metal exploration projects being carried out in the Flin Flon-Snow Lake belt include:

— HudBay at Anderson Lake, Trout Lake, Namew Lake, Snow Lake, Manistikwan Lake, Bear Lake and in the former North Star Mine and the Wim deposit areas — HudBay and Granges at Schist Lake-Westarm Mine

— MMR near McClarty Lake

— Falconbridge at Daly Lake and Cook Lake

— Copperquest (CDN) at Bear Lake.

Base metal exploration activity in the Lynn Lake belt showed signs of resurgence in 1991. Exploration drill programs were conducted by: MMR at Arbour Lake, Granges at Eldon Lake, HudBay in the Rat River area, Goldbelt Mines (VSE) south of the Ruttan Mine, and Eastmin Resources (VSE) and partner Bellex Mining (VSE) at MacBride Lake.

At MacBride Lake, 65 km east of Lynn Lake, Eastmin and Bellex are conducting a drill program to explore the Knobby Lake zinc-copper deposit at depth. Eastmin optioned the property early in 1991 from majority holder Kancana Ventures (VSE) and is attempting to earn an 80% interest in the property. Knobby Lake drill results released in December, 1991, include 6.1 metres of 10.08% zinc and 0.30% copper at a vertical depth of 275 metres. Bellex claims this drilling indicates a thickening of the sulphide lens at depth. At the Ruttan Mine, near Leaf Rapids, HudBay commenced production from the newly confirmed West Anomaly deposit. Ramps from the 660-metre level have been completed up to the 630-metre level and down to the 690-metre and 740-metre levels; development of these levels continues.

An exploration drilling program is underway to investigate the deposit between the 320-metre level and 550-metre level. Diluted, proven and probable reserves of the West Anomaly deposit are stated at 5.78 million tonnes grading 1.34% copper and 2.13% zinc.

In the Thompson Nickel Belt, Inco Exploration and Technical Services conducted geophysical and drilling programs at Ospwagan Lake, Burntwood Lake, Paint Lake, Nichols Lake and in the Birchtree Mine area.

Capital development projects at Inco’s Manitoba Division are continually being reviewed in response to nickel market conditions.

Development programs currently under way will maintain scheduled Divisional production requirements. Development in 1991 at the new l-D orebody consisted of level advance on the 1600, 2400 and 3600 levels, as well as ramp development from the 2580 level. Development on the 3600 level exploration drift was started. Limited production is expected from the 1-D beginning in 1994. Development work at the Thompson mine 1-C orebody continued and production of 1450 tonnes per day is expected by 1993 increasing to 1650 tonnes by 1995.

Full production at Inco’s Open Pit South was reached in 1991. Average production throughout the year was 21,500 tonnes of total material per day. The waste to ore ratio is approximately 3.1.

Average production from the Birchtree Mine increased from 1,450 tonnes per day in 1990 to 1,800 tonnes per day in 1991. New development consisted of installation of the 2100 level tram system, as well as ramp, sub-level and drawpoint development. The proposed $78 million shaft deepening program is expected to commence in 1993.

Exploration on the southern extension of the Thompson Nickel Belt was extremely active in 1991. Falconbridge conducted airborne geophysical surveys at Cedar Lake and in the Wabowden area, and ground geophysical surveys at Minago River and South Moose Lake, in addition to diamond drilling at Cedar Lake, William Lake, Hargrave River and near Ponton.

MMR conducted geophysical and drilling programs on their permits in the Minago River and Talbot Lake areas. Black Hawk carried out additional drilling on the Minago deposit. Further south, Cominco (TSE) conducted geophysical and drilling on their Special Permit at Lake Winnipegosis. This activity is expected to continue in 1992 because many geophysical targets have not yet been tested.

The most promising gold exploration in Manitoba is in the northeastern part of the Superior Province. Here, Noranda (TSE) has obtained further encouraging results on the Monument Bay project and adjacent areas. In the Flin Flon-Snow Lake belt, drill programs were conducted by HudBay at Third Cranberry Lake and by Granges at Second Cranberry Lake. Reconnaissance mapping and prospecting programs were conducted by Cameco (TSE) at Elbow Lake and Reed Lake, Noranda at Wekusko Lake, and A.L. Parres Ltd. near Naosap Lake.

TVX Gold (TSE) has sold its 34.1% stake in High River Gold Mines (TSE) to Restech International of Australia. High River controls the Nor-Acme deposit, a former producer at Snow Lake that contains proven, probable and possible reserves of 3.8 million tonnes grading 6.5 grams gold and remains open at depth and along strike. Restech plans to expand on TVX’s $6 million of exploration work.

In the Lynn Lake Belt, MMR conducted geophysical, geological mapping and drilling programs at Beaucage Lake, 55 km southeast of Lynn Lake. MMR optioned the property from Mid-North Resources in 1990 and has a conditional right to earn up to 100% interest by spending $2.5 million on exploration. In addition, Cameco conducted line cutting, geophysical surveys and geological mapping at Counsell Lake.

In the Gods Lake greenstone belt, in northeastern Manitoba, Noranda Exploration was involved in several prospecting, geophysical and drilling programs. The company and project partner Bellex were particularly active on the Monument Bay property where further encouraging drilling results have been obtained.

Previous drilling there revealed three gold-bearing zones which are estimated to contain preliminary reserves of 2.4 million tonnes at 2.74 grams, 472,000 tonnes at 15.77 grams and 590,000 tonnes at 9.94 grams, respectively. In the Rice Lake belt, in southeastern Manitoba, overburden drilling, prospecting, geophysical surveys and diamond drilling were carried out. Companies active in the area included International Falcon Resources (VSE), Cominco, Rodren Drilling, Cameco and a few individual prospectors. Exploration drilling for pegmatites was carried out by Tantalum Mining Corp. of Canada in the Bird River area.

D.E. Prouse is Resident Geologist, The Pas, and Bruno Esposito is Assessment Geologist, Winnipeg, Manitoba Energy and Mines.