Wolfden devours Nunavut properties

Ontario-based Wolfden Resources is making its mark in Canada's far north, and the company's acquisition of Lupin gold mine from Kinross could significantly lower the costs of its other projects in Nunavut. Almost simultaneously with the announcement in mid-February of the deal with Kinross, Wolfden also signed a letter of intent with Inmet Mining to acquire the nearby Izok, Hood and Gondor base metal deposits in Nunavut.

Lupin has produced more than 3 million ounces of gold since 1982, and there may be potential for further near-term production, according to Wolfden, but the primary planned use of the mine is for the processing of ore from Izok, Hood and Gondor, and possibly from another of Wolfden's properties, the Ulu gold deposit. Wolfden intends to perform underground drilling and drifting on Ulu's mineralized zones this year. Without the acquisition of Lupin and its mill, Wolfden would have had to build a mill at Izok.

Wolfden believes Izok has potential

Wolfden believes that Izok is one of the world's highest-grade undeveloped base metal deposits, with an indicated resource of 16.5 million metric tons grading 2.2 percent copper, 11.4 percent zinc and 60 grams per ton gold - as estimated in 1994. Historical studies have shown that the majority of the Izok deposit can be mined using low-cost open pit methods.

This year Wolfden is also continuing its exploration and development program at the High Lake polymetallic property, its most northern project in Nunavut. Most of the volcanic belts in the region have not been surveyed from the air, according to Wolfden's president and CEO, Ewan Downie, and the company hopes that multiple VMS, volcanogenic massive sulfide, discoveries are still to be made.

"By owning infrastructure, a port and a road, we'd really be the major player of the entire belt, and that's something you can't put a value on, is what a port and a road system in the north is worth," Downie said in a presentation at the BMO Nesbitt Burns Global Resources Conference in Tampa, Fla., Feb. 27. "You can't say it's worth X in your share price, but it's something you can be assured will be a huge plus, as local communities and governments will be wanting to use our shipping ports throughout the year, and that will be a huge value added for our company."

Two Inuit groups have offered support

Wolfden has been approached by two Inuit groups that have offered support for the company's proposed port site, and there are signs that the Nunavut government may also shift to backing the company's plan rather than an alternative site in Bathurst Inlet. The proposed 300 kilometer road would run from the Grays Bay port site to Nunavut's border with Northwest Territories.

"Fuel supply is a huge benefit, we could potentially become a fuel supply hub for the diamond mines, Jericho, Diavik and Ekati," Downie said. "This year's been a trying year for those mines at getting supplies in because of warm weather down to the south, and they're having a hard time getting (an ice road) in, so a northern road is something they'd always thought would be an advantage to the diamond projects, and bringing fuel in by ship would be considerably cheaper than trucking it up to Yellowknife and then again trucking it up to the site."