The Snow Lake Mine is debatably the most storied property in the history of Northern Manitoba; its high tonnage, low-grade orebody has spawned countless companies and resulted in multiple lives spanning six decades, two separate centuries and a couple of millenniums.
It's also held four different names during this era. Initially dubbed the Nor-Acme Gold Mine, the property has been also known as the Britannia Mine, the New Britannia Mine, and most recently, the Snow Lake Mine, although Britannia was never an official name.
As local folks know, this mine that brought the community of Snow Lake into being back in 1947, and is once again in the process of being sold. With that sale, hope for another incarnation has emerged. One of the major players in the still pending deal is David Rigg, president and CEO of Toronto-based Northern Sun Mining, the company purchasing the mine. Rigg is also no stranger to Snow Lake or this legendary orebody.
According to QMX Gold's website, the bearded, middle-aged mining executive has over 30 years of experience in the mining industry, including work on exploration and mine development programs in Ontario and Quebec. The website says that most recently he was president and CEO of the former Alexis Minerals Corporation (now QMX Gold) and president and CEO of Liberty Mines (now Northern Sun Mining).
He contributed to the discovery of the Musselwhite Mine and was a member of the Laronde Mine discovery team awarded Prospector of the Year by the Quebec Prospectors Association in 1995. Rigg holds a B.A. and M.A. from King's College, Cambridge University, England (1978) and a M.Sc. from Queens University (1980).
Reached by e-mail early in April, Rigg was asked about the status of the deal. He explained that the sale of the Snow Lake Mine and property by QMX Gold to Northern Sun Mining has yet to close. "We now expect all approvals for the transaction by mid-April, with closing at the end of April," he said. "Approvals are required in Canada and in China, because Jien International Investments Ltd. ('JIIL') owns 60 per cent of Northern Sun's equity," he added.
Once the acquisition is completed, Rigg expects that the project will require three or four months to finalize financing before getting the final go-ahead. He notes that Northern Sun currently has parties interested in both debt and equity financing and that majority shareholder JIIL have also reaffirmed their commitment to maintain a 60 per cent interest in any future equity financings. "We anticipate the 18-month program to reopen the Snow Lake Mine, identified in the QMX feasibility study, will commence in late summer," he confirmed. "This program will start milling after approximately 12 months, ramping up to full production as the various areas in the 3 Zone, Birch Zone, and Main Mine are developed."
When Inco Gold began work dewatering the Nor-Acme mine back in 1988, it is said the water was up to, or very near, the shaft collar. It took months, with mine pumps going round the clock, to empty the workings of the water that had accumulated over the three decades it was closed. Similarly, the pumps for the then New Britannia Mine were shut down shortly after it closed in January of 2005, and not much of anything to do with the underground infrastructure was ventured after the mine was cleared of equipment and fixtures.
Rigg, however, says that he is confident the water underground is nowhere near those levels. "The Snow Lake Mine is reported to be a very dry mine," wrote Rigg. "Estimates for the level of water in the mine are that it will be currently near the bottom of the shaft at the 3000 level. The 600 feet of the mine vertically below this and accessible by ramp, are probably flooded. Access to these deeper levels in the development schedule is required only after 22 months, so there is ample time to confirm this and proceed with dewatering. The principal area of focus in the Main Mine is above the 1780 level, considerably higher in the mine."
Rigg says that 3 Zone, which was previously accessed by ramp, is known to be flooded. He advises that the ramp will be dewatered during the first few months (of their 18-month reopening period) to restart production and that the company will also develop a small open pit on the Birch Zone, located North of 3 Zone, during this (18-month) period.
Over its years of operation as New Britannia, owners of the mine contributed to the Town of Snow Lake's tax base on a payment-in-lieu (PIL) basis. This was a set amount, negotiated by the company and the town that was paid annually in lieu of levied taxes. This process carried on, albeit at lower levels, until 2012. That was when QMX Gold elected to go under an assessment system rather than the PIL. The move resulted in taxes of $243,088.87 being levied on the mine, which was over four times as much as their 2011 PIL. The taxes were in arrears as of 2013 and Rigg was asked if that liability would be transferred to Northern Sun or paid prior to the deal concluding. "I understand that the Municipal tax bill has been paid, or will be fully paid, prior to closure of the acquisition," Rigg said.
Mayor Clarence Fisher rather cryptically confirmed this, stating: "Now that Northern Sun is working under an assessment structure, instead of a payment-in-lieu structure, I need to make certain that I am following the rules of the Municipal Act. Draw your own conclusions from the fact that the act states that I am not allowed to discuss any properties that do not have arrears of over a year."
Citing the mine's long-standing and historical commitment to Snow Lake, Rigg noted that there has always been a strong, favourable relationship between the mine and the community. "This has been a long-term relationship with the residents and the municipality of Snow Lake that extends back to mining during the 1950s and 1960s as the Nor-Acme Mine, and during the period of 1996-2006 as the New Britannia Mine.
"The objective of maintaining these relationships has not changed since QMX acquired the Mine in 2010 and, under Northern Sun, we will strive to maintain strong and positive working relationships into the future." Having said that, Rigg also noted that there is a long history behind the payment-in lieu approach to municipal taxes in Snow Lake, which has only recently been changed to the assessment approach. "Northern Sun remains open to discuss either approach," he offered. "The municipality has been very understanding of the work and financing required, to advance the project by Garson Gold; then QMX, and in the future by Northern Sun."
It has long been known that when the Snow Lake Mine begins to develop and operate, accommodations will be required for their workforce. The camp concept has long been a sore spot to many Snow Lakers, but from a company perspective it is understandable, if there are no apartments or rental accommodations, in order to staff a mine, there is no other alternative. "We have seen the construction of a camp near the Snow Lake Mine Site for workers building the Lalor Mine," Rigg observed. "We recognize that with the work force required for the Snow Lake Mine and the new Lalor Mine, that there is a scarcity of accommodation in the area. We anticipate there may be the need for an additional 100-man camp. The location, size and timing for a camp will be reviewed in the early stages of our development programs and in light of the needs of the employees and the community."
The topic of corporate relationships was also broached with Rigg during the interview, as was the fact that Hudbay has a strong presence in the community and BacTech Environmental Corporation is working towards establishing one. He was asked about his company's ties with these two companies, as well as the Town of Snow Lake. Rigg reaffirmed his company's relationship with the town, noting that the community and people of Snow Lake are of great importance to them. "We strive to work with the local community and see the Snow Lake Mine back in full production," said the CEO. "This has had, and will have, significant positive impact in the area and will add to the gains already seen with the discovery and development of the Lalor deposit."
In respect to other area corporations, Rigg said Northern Sun remains very open to developments and the potential to work with BacTech Environmental Corporation and Hudbay. "The best way to offer assistance to BacTech is to offer them access to our mill," said Rigg. "This however can only come when the mill is operational and after successful negotiations on commercial rates. The mining industry is a relatively small industry. Although we may be in competition with other companies on several business fronts, there are always areas where we can work together or provide assistance when and where the need arises."
To conclude the interview, the CEO was asked if there were any final things that he wanted to say or to relay to the people of Snow Lake.
"During my first visit to the New Britannia Mine in 2010, Rigg said, "as the former president and CEO of Alexis Minerals, I was very encouraged by the potential in the mine and the prospect for the mine to reopen as a commercial mining operation," he wrote. "Unfortunately with the very difficult financial markets since 2008, Alexis and QMX gold have been unable to raise the required capital to resume operations. The acquisition of these assets by Northern Sun will substantially improve our ability to put the financing in place to support the reopening of the Snow Lake Mine. I look forward to participating in this work and in the continued growth of the Snow Lake area."
