Economy
South Slave

Pine Point could be worth $5.6B over 12 years, new estimate states


Reopening the NWT’s Pine Point mine could lead to $5.6 billion in gross revenue after royalties, says the company trying to restart zinc and lead mining there.

Osisko Metals this month released estimates that give the mine a net present value of around $600 million, with a 12-year mine life and billion in potential earnings at current market prices.

Pine Point is entering environmental assessment, a key stage in which regulators will scrutinize the proposed mine’s potential impacts on the surrounding environment and peoples.

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A key issue for Pine Point has been the amount of dewatering required to mine up to 47 open pits, alongside eight underground deposits.

Osisko now says a new approach has reduced forecast dewatering by 30 percent, which saves money and energy and reduces greenhouse gas emissions.

The company now forecasts $653 million, including a contingency of $106.6 million, will be required to build the mine.

Osisko says projected emissions are down three percent on its last forecast, even though the mine is now expected to stay open for two years more than was previously planned. The company did not, however, provide any more detail – such as figures in kilotonnes – about the mine’s anticipated emissions.

According to this month’s preliminary economic assessment, the mine’s production is estimated at 329 million pounds of zinc annually and 141 million pounds of lead annually.

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In a statement, Osisko Metals chief executive Robert Wares said the assessment showed “a very robust zinc project with viable economic metrics … as well as significantly increased resources.”

A previous assessment, in 2020, had projected mining of significantly less material and gross revenue of $4.4 billion, more than $1 billion lower than the new figure.

Wares said Pine Point could become “a top-10 global zinc-lead producer.”

Even so, environmental assessment ordinarily takes many months and the opening of any mine, if a further feasibility study return a positive result and funding is found, would be years away.

Pine Point, located between Hay River and Fort Resolution, is currently little more than the footprint of its former mining town. The community was once home to almost 2,000 people but disappeared when the first mine, which opened in 1964, ceased operations in 1988.

The initial mine produced more than 64 million tonnes of zinc-lead ore and was considered a world-class producer at the time.

While Pine Point would not create the same employment as the NWT’s largest diamond mines, Osisko says it would still be a major job creator for the South Slave.

Documents submitted by the company to trigger the environmental assessment process claimed construction will employ at least 280 people at the mine, with a peak of 500, while the operational mine would need about 460 people in two shifts of 230.

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