Voisey’s Bay is scheduled to come on-stream in 2006. Initial development there involves the construction of an open-pit mine and 6,000-tonne-per-day concentrator. It’s a much smaller and much more straightforward project than Goro. “While Voisey’s Bay’s distance from our other Canadian operations creates some logistical challenges, they are not unique,” says Inco Chairman Scott Hand.
The project lies along the northern coast of Labrador, 335 km northwest of Happy Valley-Goose Bay. It is on a peninsula bordered to the north by Anaktalak Bay and to the south by Voisey’s Bay, 35 km southwest of Nain and 80 km northwest of Utshimassits. The project area offers challenges consistent with a remote, sub-arctic environment. Inco has experienced somewhat similar working conditions at its operations in Thompson, Man.
Through its wholly owned subsidiary, Voisey’s Bay Nickel Company (VBNC), Inco owns a 100% interest in 2,705 mineral claims covering three separate claim blocks totalling 676 sq. km, including the mineral claims comprising the Voisey’s Bay deposits.
The deposits contain a total resource of 142 million tonnes, including a proven reserve of 31 million tonnes grading 2.88% nickel, 1.69% copper and 0.14% cobalt in the Ovoid zone that will be mined by open-pit methods. The Ovoid is a bowl-shaped deposit measuring 800 by 350 metres, and it is more than 100 metres thick at the centre. The top of the deposit sits 2.5-30 metres below surface. The proposed pit will be 1 km long, 500 metres wide and 125 metres deep.
The Ovoid deposit consists of roughly 70% crystalline massive sulphide minerals. It is believed to represent a depression on the bottom of a troctolite sheet, where sulphide magma collected during the emplacement of the troctolite.
Most of the remaining, 111-million-tonne resource is contained at depth in the Eastern Deeps zone and the Western extension, which includes the Discovery Hill and Reid Brook zones. The indicated portion of this resource is estimated at 97 million tonnes grading 1.29% nickel, 0.61% copper and 0.08% cobalt. A further 14 million tonnes grading 1% nickel, 0.7% copper and 0.06% cobalt are inferred.
The Eastern Deeps zone is 1 km southeast of the Ovoid. The deposit is ribbon-shaped and lies at the base of a large troctolite intrusion. Mineralization consists of an upper disseminated sulphide zone and a basal massive sulphide zone. The deposit begins at about 500 metres below surface and extends to depths of 1,000 metres. It measures 1,000 metres long, 100-200 metres wide and 20-100 metres thick, and plunges east-southeast at 20.
The Discovery Hill and Reid Brook zones in the Western Extension occur 1 and 2 km west of the Ovoid, respectively. They are thin lenses of massive sulphide in a narrow sheet of steeply dipping troctolite. The Western Extension mineralization extends from near-surface to at least 800 metres in depth. The mineralized zone is discontinuous, measuring 1,600 metres long, 150 metres wide and 20-70 metres thick.
Before it closed down its exploration camp at Voisey’s Bay in September 2001, Inco had spent $100 million, bringing total expenditures to about $160 million when combined with previous exploration expenses of Diamond Fields Resources. Five-hundred and fifty-five holes, representing 350,000 metres, have been completed.
Ryan’s Pond
Several promising targets in the main claim block warrant additional drilling, including the Ryan’s Pond prospect, 4 km west of, and along strike with, the Eastern Deeps zone. Ryan’s Pond is defined over a 400-metre strike length. In a company report, Inco stated that “the drilling in 2001 at Ryan’s Pond continued to be encouraging.”
The Voisey’s Bay nickel project will entail an estimated total investment of $2.9 billion over a mine life of 30 years, including sustaining capital expenditures. This investment breaks down roughly as follows:
q $710 million to build an open-pit mine and concentrator at Voisey’s Bay;
q a $180-million hydrometallurgical process research and development program, which will entail construction and operation of a demonstration plant at Argentia on the southeastern corner of Newfoundland;
q a $670-800-million nickel processing plant that will produce London-Metal-Exchange-grade electrolytic nickel.
At the end of 1977, Inco submitted an environmental impact statement to regulatory authorities for the development of a proposed 20,000-tonne-per-day mine and mill complex plus related infrastructure. Following the initial public review, Inco was asked to provide additional information, which it completed and submitted in June 1998.
In April 1999, the environmental assessment panel recommended that the project be allowed to proceed, subject to more than 100 recommendations, one of these being that production levels should ensure a mine life of at least 20-25 years. Inco complied by proposing a 6,000-tonne-per-day operation with a mine life of about 30 years. A comprehensive bankable feasibility study for the proposed mine and concentrator is due in early 2003. It is expected to provide capital and operating cost estimates, which are required in order to arrange financing.
Other recommendations called for the completion of impact and benefits agreements with both the Innu Nation and Labrador Inuit Association. The development of Voisey’s Bay is taking place on land that is claimed by both groups.
“In Canada, aboriginal peoples such as the Labrador Innu and Inuit have been clearly recognized as having rights with regards to such lands,” says Thomas Paddon, VBNC’s manager of Labrador and aboriginal affairs.
During the third quarter of 2002, Inco entered into agreements with both aboriginal groups that will provide financial compensation and specific employment and training opportunities. While the content of the impact and benefits agreements remains confidential, Paddon says they resemble those that have been negotiated at the Raglan project in northern Quebec and the Ekati and Diavik diamond mines in the Northwest Territories.
Site preparation work at Voisey’s Bay began in July 2002, after Inco reached a definitive deal with the government of Newfoundland and Labrador that provided the overall framework for the development of Voisey’s Bay. Inco crews have been clearing the land where the concentrator will be built, and constructing temporary dock facilities at Edwards Cove, in Anaktalak Bay. A 760-metre-long temporary airstrip and 12.5 km of access roads, connecting the dock to the mine site, are now complete. Most of the equipment and supplies for the project will arrive at Edwards Cove by barge.
Aboriginal joint-venture companies were awarded 13 development contracts valued at a total of $30 million. The Voisey’s Bay camp was expanded to house about 240 workers this year.
Construction of the mine, concentrator and support infrastructure will begin in earnest in 2003 and be completed in 2006. At its peak, the construction phase will create 550 jobs.
Equipment procurement will begin in 2003 and carry on through early 2005. Commissioning will begin in late 2005, and the first concentrate is planned for mid-2006.
The 6,000-tonne-per-day concentrator is designed to produce, on an annual basis, 110 million lbs. of nickel contained-in-concentrate, 15 million lbs. copper and 5 million lbs. cobalt. The plant will produce two separate concentrates: a copper concentrate, to be sold on the open market, and a nickel-copper-cobalt concentrate, which initially will be processed at Inco’s operations in Ontario and Manitoba until a processing plant is constructed at Argentia, no later than the end of 2011. Inco has guaranteed it will replace the concentrate shipped out of province from one or more sources worldwide.
Port storage
The Voisey’s Bay mill will utilize conventional grinding and flotation. The tailings will be disposed under water in Headwater Pond to prevent acid generation, and the concentrate will be trucked the port storage facility to await shipping to a final destination.
Some of the infrastructure required to support the operation will include a diesel-powered generating plant for electrical needs, various service and haulage roads, and an airstrip. There will also be a port to serve marine transportation needs and provisions for bulk fuel storage and concentrate storage.
Given the fly-in/fly-out nature of the operation, a full service accommodation complex will be built, including maintenance shops and a warehouse facility. The operation is expected to employ 400 people during the open-pit stage.
During construction of the open-pit operation, Inco will proceed with a first phase, 4-year, $20-million exploration program designed to investigate known underground resources. The underground resource needs further definition drilling, engineering work and metallurgical studies before a mining plan can be developed. This past summer, Inco conducted a 3-month drilling campaign to collect a bulk sample for metallurgical testing. The underground exploration program is expected to have a total cost of $95 million.
The long-term plan calls for the mill to be expanded and for underground mine development to begin in 2018 at a projected cost of $750 million. The underground operation will add another 400 jobs.
Concurrently with the construction at Voisey’s Bay, Inco will be conducting a hydrometallurgical research program, which will culminate in the design, engineering and building of a demonstration hydromet pilot plant at Argentia by 2006.
“Assuming the technical and economical viability of this program, we will begin building a commercial hydromet plant in 2009,” said Robert Kelly, a VBCN representative who spoke to delegates at a recent conference of the Newfoundland branch of the Canadian Institute of Mining, Metallurgy and Petroleum, in St. John’s.
Hydromet research
Inco is committed to constructing a nickel processing plant in the province. The type of plant will be determined by the outcome of the hydromet research and development program. By mid-November 2008, Inco will inform the provincial government of its decision whether or not to build a hydrometallurgical processing plant at a capital cost of $800 million. Should the proposed hydromet processing prove neither technically or economically feasible, Inco will construct a commercial electrolytic refinery or other such plant using proven technology to produce a finished nickel cathode product.
The hydromet research program is already under way, and the design of the pilot plant is nearing completion.
“We are currently in the process of registering the demonstration plant for environmental assessment and we’re also finalizing site access agreements at Argentia,” said Kelly.
Preliminary site work is scheduled to begin shortly. Approximately 200 people will be employed during the research and development phase.
Inco will spend at least $55 million on site preparation at Voisey’s Bay and Argentia by the end of March 2003. In addition, Inco intends to spend $10 million establishing an Inco Innovation Centre in St. John’s, in conjunction with Memorial University of Newfoundland. The centre will focus on education and research in mineral exploration, mining and metallurgy. Inco will provide an annual endowment of $1 million over a 10-year period to cover operational costs.
Mines and Energy Deputy Minister Brian Maynard expects Voisey’s Bay will be a major catalyst in the economic growth of the province.
“The Voisey’s Bay project will not only provide 76,000 direct and indirect person years of employment for the next 30 years,” he says, “it will inject $11 billion into the province’s gross domestic product. It will also promote the advancement of the aboriginal people of Labrador and put us at the forefront in the development of the hydromet technology for sulphide ore deposits.”
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