$70-million nickel mine opens at Namew Lake

Hudson Bay Mining and Smelting Co., (TSE) and Outokumpu Mines have formally commissioned a new nickel/copper mine at Namew Lake in northern Manitoba.

The $70 million project, the first new underground nickel mine in Canada in nearly a decade, is expected to produce nickel at a cost of about $1.60(US) per lb. By the end of the 1989 first quarter, the mine is expected to be producing at a rate of 525,000 short tons of ore annually, yielding 64,500 short tons of nickel concentrate and 13,500 short tons of copper concentrate.

An advanced-technology mill constructed at the site is expected to produce 23.1 million lb of nickel in concentrate and 7.7 million lb of copper in concentrate annually.

Hudson Bay, which discovered the high grade deposit about 40 miles south of its metallurgical complex at Flin Flon, Man., owns 60% of the project and is the operator. Outokumpu, which designed and constructed the 2,100-ton-per- day, computer-controlled mill, owns the remaining 40%.

The mine, with ore grades are significantly higher than that of an average nickel discovery, currently contains 2.82 million tons of proven and probable reserves, grading 2.44% nickel and 0.90% copper with small amounts of platinum group metals.

The Namew Lake discovery is the first economically viable nickel deposit in the area, which is known for its copper-zinc deposits. The orebody was discovered following an airborne electromagnetic survey of the area between 1979 and 1980 using Hudson Bay’s own system. A number of geophysical anomalies were detected, and ground follow-up led to the drilling in April 1984 of the discovery hole at Namew Lake. In early 1985, a major drilling program further outlined the deposit.

A 1,350-ft exploratory shaft was sunk at the site between 1985 and 1987 to gain access to the orebody, which lies about 2,000 ft from the shore and under Namew Lake. Construction of the on-site concentrator began in late 1987.

The copper concentrate, containing between 25% and 85% copper, will be trucked to Hudson Bays’ Flin Flon smelter for treatment. Hudson Bays’ share of nickel concentrate, grading between 15% and 18% nickel, will be sent to Sherritt Gordon Limited’s refinery at Edmonton, Alta. Outokumpu’s share of nickel concentrate will be trucked to Inco’s refinery at Thompson, Man.

Hudson Bay is a subsidiary of New York-based Inspiration Resources (TSE), a diversified natural resources company. Hudson Bay mines and processes metals (primarily copper, zinc, gold and silver) at Flin Flon, Snow Lake and Leaf Rapids, all in Manitoba and has other natural resource operations in Canada.

Outokumpu Mines Ltd. is a subsidiary of Outokumpu Oy of Finland, an integrated multi-metal company with extensive international operations., Outokumpu’s other Canadian interests include joint venture participation in the Trout Lake copper/zinc mine in northern Manitoba and precious and base met als exploration activities throughout Canada.