All-season road to N.W.T.'s proposed Prairie Creek Mine approved

A company working on opening the N.W.T.'s next mine is hoping to begin construction of a 180-kilometre all-season road to it next winter.

The federal government gave its final approval to the road to the Prairie Creek mine an advanced-stage zinc, lead, and silver mine last week.

"The ideal time to build the road will be[first quarter] in 2020, with production in 2022," said Don MacDonald, president and CEO of NorZinc Ltd., the owner of the mine.

More than half of the road will pass through the Nahanni National Park Reserve. Prairie Creek is located about 250 kilometres west of Fort Simpson.

MacDonald said NorZinc is working with international investors, includinga U.S. investment fund that specializes in medium-sized mining companies, to raise the $280 million required to bring the mine into production.

"The investment timeline for this, though, is really next year, that all the money needs to gel together,"saidMacDonald, who joinedNorZincin June."But we're working on these different fronts at the same time."

Project delays allowed for proper consultation, says CEO

Federal approval for the road came in an Oct. 9 letter from Carolyn Bennett, minister of Crown-Indigenous Relations, to the Mackenzie Valley Review Board. The board approved the project a year agoon the condition that Canadian Zinc carry out 16 measures to reduce the impact the road will have on the environment.

The measures include ongoing monitoring of permafrost along the route, wildlife monitoring incorporating traditional knowledge, and the creation of an independent technical panel to ensure the road's design protects people and the environment.

NorZinc, which was created last year in a restructuring of Canadian Zinc, said last year it was planning to bring the mine into production in 2020. But that deadline got set back when the review of the project was delayed to ensure proper consultation with affected First Nations, including the Liidlii Kue First Nation of Fort Simpson and the Naha Dehe Dene Band of Nahanni Butte.

"I definitely think this delay has helped us and will help make sure we do the best we can with Nahanni Butte and LKFN and the other Dene groups involved in this process," said MacDonald. He said the company is meeting monthly with those two First Nations in an attempt to reach environmental management and traditional land use agreements.

The agreements would have set out the First Nations' involvement in the design, construction, operation and eventual closure of the road. Both sides wanted the minister to order the agreements be finalized before construction of the road begins.

But developments outside the N.W.T. have injected more volatility into world prices, which makes financial forecasting for the project more difficult.

"Particularly with what's been going on between China and the U.S., which has had a volatile effect on our base commodities," said MacDonald.

"For example, lead was up at about $1.20 a pound just a few months ago, when I joined. It went down last week to 85 cents a pound, so a huge drop. Then it went up today to almost 95 cents a pound. Those are colossal swings."