Nunavut regulator won’t confirm project certificate transfer to Doris North mine’s future owners
NIRB wants to see proof of sale, financial resources, before transferring certificate from Newmont to TMAC
Newmont Mining Corp. received disappointing news Feb. 13 from the Nunavut Impact Review Board: it won’t have any certainty that the project certificate for the development of the Doris North gold mine at Hope Bay will be transferred to the project’s future owners.
Newmont had written the Nunavut regulator earlier this month saying it wanted confirmation that the NIRB would change the name of the holder of the Doris North gold mine project certificate from Newmont’s Hope Bay Mining Ltd. subsidiary to the future owner of the mine, TMAC Resources Ltd., effective as of the date of the closing of the transfer on March 31.
But without “satisfactory documentation confirming the legal transfer of ownership of the assets governed by the Project Certificate and the financial ability of the proposed new owner to carry out the activities authorized under the Project Certificate,” the NIRB said it can’t guarantee the certificate can or will be transferred.
The NIRB’s executive director Ryan Barry told Chris Hanks, vice-president of environment at Hope Bay Mining Ltd., Feb. 13 that the NIRB can’t predetermine the outcome of a request by “confirming” a particular course of action until it gets that information about the transfer.
The new privately-held firm called TMAC Resources Inc. signed a letter of intent with Newmont Dec. 17 to acquire the Hope Bay mine prior to a deadline of March 31.
Under the deal, Newmont will become a major shareholder in TMAC, which it views as the best vehicle for moving the Doris North gold mine at Hope Bay into production.
Newmont hit the brakes on its activities at Hope Bay early in 2012, putting its completed infrastructure into care and maintenance and sending a big shock wave through the Kitikmeot’s fragile economy, which lost about 150 jobs.
Between 2009 and 2011, Newmont spent about $290 million on Kitikmeot region and Nunavut based businesses, many of them partners or subsidiaries of the Kitikmeot Corp. or the Nunasi Corp.
By the fall of 2012, work on the company’s underground Doris North mine had ground to a halt and numerous vehicles, drills and supplies were being sold or removed.
Newmont wrote off $1.6 billion worth of its investment in the Hope Bay project and announced it would give priority to other projects within its global collection of mining properties.
The entire Hope Bay property which covers an 80-kilometre greenstone belt, is believed to hold at least nine million ounces of gold.
In the NIRB’s letter to Newmont, Barry said the NIRB recognizes the importance to the parties of not having “undue delays between the legal transfer of assets and the transfer of the associated regulatory authorizations,” including the project certificate.
The project certificate reconsideration process would be “efficient and timely,” Barry said.