Toronto firm wins Faro mine contract

Denison Environmental Services, a division of Denison Mines Inc., has won a three-year, $21.6 million contract for care and maintenance at the Faro Mine Complex in the Yukon.

A subsidiary of Canadian uranium producer Denison Mines Corp., the company was chosen after a six-month competitive bidding process overseen by the Yukon government of Yukon.

Ontario-based Denison Environmental will provide care and maintenance services at the Faro Mine Complex, including: the ongoing collection and treatment of contaminated water, the management of uncontaminated runoff; the inspection and maintenance of dams and diversion channels; the monitoring of water quality; general maintenance and site security.

The contract also includes provisions for training and employment opportunities for affected Yukon First Nations and Yukon residents.

"The award of this contract is an important recognition of the technical expertise and experience of Denison Environmental Services and expands the reach of our rehabilitation efforts across the country," Denison Environmental manager Ian Ludgate, said in a statement Aug. 5.

Faro was an open-pit lead-zinc-gold-silver mine that was a mainstay of the central Yukon economy for several decades. The Canadian government declared the Faro mine abandoned after Anvil Range Mining Corp. ceased production in February 1998 because of financial problems.

Since then, Canada has paid for care and maintenance of the site, which this year will total about C$16 million. A court-appointed interim receiver, Deloitte and Touche, has managed the mine's care and maintenance, including water treatment so that water flowing from the site meets acceptable standards. It also includes regular inspection and maintenance of all structures on the site.

In January 2003, the federal and territorial governments acknowledged that the Faro Mine complex would not reopen. The governments then entered a joint agreement with the Ross River Dena Council (on behalf of the Kaska Nation) and Selkirk First Nation to work together on the development of a closure and remediation plan for the entire site.

Denison Environmental will take over the care and maintenance responsibilities in March 2009, after a transition period with Deloitte and Touche.

Denison Environmental was formed to assist the mining industry and governments with the final stages of the mining cycle. Its goal is to lead the industry in cost effective decommissioning solutions to mine closure issues, focusing on infrastructure, tailings rehabilitation, sale of mine assets and especially long term-care and maintenance of closed sites.