New St. Lawrence mine owners promising big things for fluorspar, including a return to the deeps

The new and deep-pocketed owners of the St. Lawrence mine are promising to avoid the mistakes of the past, and they saythe operation can supply high-purity acid grade fluorsparto a hungry market and contribute to the Burin Peninsula's struggling economy for the next three decades.

Part of that strategy includes a return some time in the future to underground mining, an activity that has not occurred in St. Lawrence in nearly half a century.

"We think there'sa lot of extension potential into underground," Willem Jacobs, managing director of mining and energy for Toronto-based advisory firm Clariti, told CBC News.

Jacobs is in charge of getting the idled siteback into production for the newowners,a Singapore-based private equity group calledAfrican Minerals Exploration & Development Funds, or AMED, for short. Andhe revealed fresh and ambitious details this weekduring a telephone interview from Cape Town.

The plan, he said, is to spend about $100 million over the next three years, with about half of that coming in the next 12 months.

He said the confidence to invest so heavily in the mine emerged following a closer examination of the fluorspar deposit, which he said is much richer than previously thought, and confidence in the long-term market for fluorspar, a key material used in the production process of lithium batteries, solar panels and steel.

Previously, the life-of-mine estimate was just six years. But Jacobs now believes there's enough ore in the ground tooperate the mine for between 20 and 30 years.

"The trick is now going to be to to balance open pit source with underground potential," he said.

Bigger trucks, bigger volumes

The first major contract will be awarded in a few months, said Jacobs, when a company is selected to mine the open pits. He said the contract calls for much larger haul trucks and excavatorsthan were used in the past.

"We have to mine faster and we have to mine much bigger volumes," he said, adding fluorspar production is scheduled to resume next year.

"In 2025 we'll be selling fluorspar, but we'll be making a very big cash loss because we're spending an enormous amount of money toget the pits resized," said Jacobs.

The owners arealso hiring a company to design a new port facility at nearby Blue Beach, which will come witha price tagof between $10 and $13 million, he said.

WATCH | Why there's now so much optimism around the St. Lawrence fluorspar mine:

Momentum and ambition abound for St. Lawrence fluorspar mine

8 months ago

Duration 2:40

The new owners of the fluorspar mine in St. Lawrence say they will invest $100 million over the next three years. After closure, hundreds of job losses, and debts, there is optimism around the project. The CBCs Terry Roberts reports.

Attempts by the previous owners to ship ore from Blue Beach were challenged by the area's exposure to heavy seas, so the mine had to transport it 42 kilometres to a port facility in Marystown, which eroded the mine's profitability.

There arecurrently 20 employees at the site, and the company says the workforce will eventually peak at roughly 200.

Jacobs said the mining contractor will be required to hire local workers "as much as they can."

Previous owners left a 'bad state of affairs'

The mineclosed two years ago after the previous owners, Canada Fluorspar, ran out of cash, resulting in the loss of roughly 280 jobs. The mine closure also left a trail of unpaid debts to dozens of suppliers and lenders, including a default on a $17-million loan from the provincial government.

Last June, AMEDFunds acquired the operation through a court-approved insolvency sale for $25 million, with experts from Clariti advising the new owners through the acquisition process.

Clariti is also shepherding the mine restart process, and in a swipe at the previous owners, Jacobs said theycreated a "bad state of affairs" by chasing after the high-grade fluorsparavailable in the open pits.

That won't be his approach, said Jacobs.

The plan for the next two-plus years is to strip away the rock and soil that covers the fluorspar known in the industry as "overburden" in order to access the valuable ore underneath and develop themine to its fullest potential.

"It's a long job ahead of us to get the pits reopened in an optimal way," he explained.

Fluorspar has a checkered past

Beyond that, Jacobs said, the plan is to optimize the operation by reopening mine shafts that were sealed in the late 1970s and go after the fluorspar deposits beneath the surface.

"We most certainly will be starting the feasibility work shortly," said Jacobs.

Fluorspar mining on the Burin Peninsula has a checkered past because of its links to both economic growth and industrial disease, and the cycle of boom and bust times.

Commercial mining began in the 1930s, withSt. Lawrence boasting one of the largest fluorspar deposits in North America.

Minewill be an 'engine of wealth'

So why should area residents have confidence in the latest attempt to operate a mine in St. Lawrence?

AMED Funds's website says the equity grouphas a proven history of developing tier-1 mineral projects in Africaand operates in more than 20 countries across the continent.

The equity group has more than $1.4 billion US in assets under management, including a "significant" investment in a South Africa-based fluorspar operation.

And Jacobshas a 30-year background in the mining, engineering and construction industries, most recently as chief operating officer for Africa and the Middle East with Toronto-based Barrick Gold, an international leader in gold and copper production.

Jacobs says the mining industry is a tough businessbut he's confident there's a bright future in St. Lawrence.

"It's a huge opportunity for everybody that's involved," said Jacobs, adding the mine will be an "engine of wealth" for the shareholders, employeesand the provincial economy.

Jacobs also plans to rebuild relationships that were fractured by the mine's failure in 2022.

"All I can tell you is look at my behaviour. You'regoing to see, hopefully, somebody that what we say is what we do," he said.

• St. Lawrence, a boom-bust N.L. town, endures another hit as fluorspar mine flames out
• How shipping challenges and a cash-flow crunch have pushed a St. Lawrence mine to the brink

St. Lawrence Mayor Kevin Pittman, meanwhile, says he's cautiously optimisticand looks forward to an upcoming meeting with mine officials to discuss matters such as a tax agreement and local benefits.

"The most important thing for me as a town right now is to get people back to work," said Pittman.

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