Inco updates Voisey's Bay situation
As part of its recently released third quarter financial results, Inco
stated that it and its wholly-owned subsidiary, Voisey's Bay Nickel
Company Limited continued their efforts in formulating possible
concepts for the development of the Voisey's Bay project.
Inco stated in a press release that it met with officials from the
Newfoundland government during the summer and early fall of 1999 to
explore, on an informal basis, possible concepts for development of
the Voisey's Bay project.
The Company expects to continue its informal discussions with the
Province which, if successful, would then lead to the submission of a
formal proposal. Assuming successful agreement with the Province by
the end of 1999, the Company would then be in a position, subject to
certain other conditions discussed below, to commence construction
at Voisey's Bay when the ice moves out in June 2000.
Exploration Program
With the initiation of the previously announced new exploration
program focusing on the main claim block area of the Voisey's Bay
deposit, exploration and geophysical operations continued as planned
during the third quarter of 1999.
Four diamond drill rigs have continued in operation, drilling primarily in
the main block area and in certain regional areas in Labrador. Core
drilling during the quarter totalled 12,018 metres, bringing the
accumulated drilling metreage through the first nine months of 1999 to
40,413 metres. More than 165,000 metres of drilling have been
completed on the main claim block and other claim blocks held by
VBNCL in Labrador since August 1996.
A new mineralized zone near Ryan's Pond, about 5 kilometres
southeast of the Ovoid section of the Voisey's Bay deposit, was
intersected by drilling at the base of a troctolite intrusion in a
geological environment similar to that of the Eastern Deeps section of
the deposit.
This zone averaged 1.3 per cent nickel, 0.7 per cent copper, 0.04 per
cent cobalt over 29.5 metres, and occurs about 1,600 metres below
surface. Drilling of this new zone does not extend far north towards the
existing known sections of the Voisey's Bay deposit but is open in all
other directions. It is situated in a large area where there has been
little previous exploration.
A further drilling program is planned to seek extensions to this new
zone with the objective of adding further resources.
A definition drilling program in the Eastern Deeps section of the
Voisey's Bay deposit began late in the third quarter, starting at the
western, shallow end of this section. The program is designed to
expand the Eastern Deeps resource, particularly the higher grade
sections, improve the geological model of the deposit and provide
additional geological and geotechnical data in support of a future
underground exploration program of the Eastern Deeps section.
In early August 1999, the federal and provincial governments
announced their respective responses to the recommendations set
forth in the April 1, 1999 report of the panel created to oversee the
environmental assessment process for the mine, mill and related
facilities and infrastructure in the Voisey's Bay, Labrador area (the
``Mine/Mill Project').
The governments released the Mine/Mill Project from the
environmental assessment process under applicable legislation
subject to certain terms and conditions, including measures intended
to mitigate potential environmental effects relating to the Mine/Mill
Project. Both governments accepted a number of the panel's
recommendations but the Company does not believe that those
recommendations or the terms and conditions of the releases
stipulated by the governments will create unduly burdensome financial
or other restrictions on the Mine/Mill Project.
With these releases by both governments, the next stage in the
regulatory approval process for the Mine/Mill Project will be the
issuance by the federal and provincial governments of the necessary
licenses and permits, including the mining lease under applicable
provincial legislation amended in late 1998, before any construction
and related activities could proceed.
The governments are currently negotiating a consultation agreement to
develop a project specific environmental management mechanism
which would involve the Labrador Inuit Association (``LIA') and Innu
Nation in the process relating to the issuance of the necessary
governmental licenses and permits.
In early September 1999, separate court actions were filed in the
Canadian federal courts by the LIA and Innu Nation asserting that the
federal government should have imposed additional conditions to, and
did not meet certain consultative and other requirements in arriving at,
its decision to release the Mine/Mill Project from the environmental
assessment process. At the request of the two aboriginal groups, the
federal court agreed to stay these actions until the end of November
1999 pending the outcome of the ongoing negotiations of impacts and
benefits agreements referred to below.
In addition, in mid-October 1999 another aboriginal group, the Nunavik
Inuit, filed an action against a federal minister in the Canadian federal
courts, asserting that its rights had not been properly considered or
protected in land claims negotiations and the agreement in principle
on land claims reached in May 1999 between the federal government
and the LIA.
Inco said it believes that, at this time, none of these court actions will
have an adverse effect on the timing or development of the Voisey's
Bay project. In August 1999, VBNCL and the LIA and Innu Nation
restarted separate negotiations on impacts and benefits agreements
(``IBAs') with each aboriginal group with the objective of reaching
mutually acceptable IBAs by late 1999.
The Company has previously stated that, in addition to receipt of the
necessary environmental clearances, in order for the overall project to
proceed the following areas had to be adequately addressed on a
timely basis: (1) the Company reaching mutually acceptable IBAs with
the LIA and Innu Nation; (2) the Company reaching agreement with the
Province on key issues relating to the project's scope; and (3) the
Company being satisfied that the project is appropriately dealt with
under the arrangements reached on land claims between the federal
and provincial governments and the LIA and Innu Nation.
Inco said it continues to believe that, if the interested parties work
together, recognizing the economic, technical and other realities that
must be taken into account, then these key issues can be addressed
to meet the needs and objectives of the Company, the governments
and aboriginal groups. |
