Pine Point’s new owner is signaling an aggressive push towards getting the site’s lead-zinc stores estimated and the financial feasibility of the project defined.
Osisko Metals Inc. announced it had acquired Pine Point Mining Ltd. on Feb. 23, obtaining all outstanding shares of the company and exchanging already-held shares in Pine Point for shares in Osisko.
K’atlodeeche First Nation, which inked exploration agreements with Pine Point Mining Ltd. last fall – along with Deninu Kue First Nation and the Fort Resolution Métis Council – has been meeting regularly with the new owners, says Chief Roy Fabian.
“They’re just keeping us abreast of what they’re doing,” says Fabian. “They’re consulting with us on a regular basis and letting us know what kind of work they’re doing.”
While Fabian says most of the project is on Deninu Kue traditional territory, exploration will eventually cross over into KFN traditional territory. As well, if a mine does start up, the KFN will be looking to develop an impact and benefits agreement. The exploration agreements were the first step towards that.
“For us, we’re putting a plan together on how we want to deal with the Pine Point Mine. If it ever gets to a point of production,” says Fabian.
He said the First Nation is looking at putting together a small conference for the community on what kinds of benefits, and work and business opportunities, are available when a mine is built in the area.
“We hope to have that conference sometime soon so we can educate our people, build a little capacity so that (if the mine) gets to the point of production, we’ve done some preparation work and we can look at what sort of businesses we want to get into,” says Fabian,
In a press release, Osisko president and CEO Jeff Hussey stated the junior miner is looking to drill 50,000 metres in 2018 at over 40 historic deposits, hoping to “rapidly convert” what’s known to be there historically into a NI43-101 compliant mineral resource estimate – the official instrument used to legally define a mineral resource in Canada.
After that, the company can use that information as well as market information on demand and price of commodities – now and what’s projected – to determine with certainty whether the profit margins are there to start mining.
Hussey did not respond to requests for additional comment by press time.
Osisko is an exploration and development company with a focus on zinc, and has other properties in New Brunswick and Quebec.
Hussey stated the acquisition of Pine Point is helping Osisko Metals “advance its goal of becoming a leading base metal mining company in Canada.”
Last year, Pine Point Mining Ltd. undertook a preliminary economic assessment of the project, which estimated it would have a 13-year mine life, producing 1.35 billion pounds of zinc and 536 million of lead, with a total estimated pre-tax income of $908 million. Capital costs to get the mine started up were pegged at $153.8 million, with ongoing costs of $117.5 million over the life of the mine, which it estimated it could afford through the money being brought in.