Most of the vast Canadian Shield that blankets the country from the Maritimes, Quebec, Ontario to Saskatchewan and the northern territories remains unexplored for mineral wealth.
Mineral wealth has been tapped mainly in regions close to denser populations.
The northern third of Saskatchewan, covered by Canadian Shield rocks, is no exception. Aside from uranium miming in the 1950s around Uranium City, the high-grade Athabasca Basin uranium mines and some gold near La Ronge, mining in the north has been a relatively small sector.
That scenario could be changing with two companies developing copper and zinc orebodies.
Both companies are drilling in the same types of rocks that have been found in northern Manitoba and developed into clusters of mines near Flin Flon and Snow Lake.
The most advanced of the two, Foran Mining, has outlined deposits at McIlvena Bay, three hours drive by connecting highway from Flin Flon and a critical smelter plant.
Since 1988, Foran's drilling near Hanson Lake has outlined a significant resource of copper and zinc with minor values of lead, gold and silver.
Resources – 13.9 million tonnes indicated 13.95 percent zinc,1.96 percent copper, and 11.3 million tonnes 13.52 percent zinc and 2.01 per cent copper – need extensive drilling to upgrade to proven and probable resources.
A 2014 preliminary economic assessment, based on slightly higher copper and zinc prices, determined the mine would produce 58.9 million pounds of zinc and 37.6 million pounds of copper annually.
Silver and gold content sale to a royalty trust could offset some of the equity needed for the $250 million underground mine.
Equity help might come from global miner Glencore. Glencore agreed to finance development from the preliminary economic assessment to feasibility study for the right to buy all production. Having an assured market will ease the financing process.
That deal may seem odd but global analysts predict a supply deficit in copper and zinc in 2020 getting worse right through to 2030.
This year, Foran plans on drilling to upgrade resources with a feasibility study updating costs later this year. A production decision is expected in 2020, with production in about two years.
The other company, Murchison Minerals, has outlined 2.9 million tonnes indicated 9.98 percent zinc and 7.6 million tonnes 6.29 percent zinc at Brabant Lake, two hours northeast of La Ronge near Highway 102. Minor amounts of nickel, copper and cobalt exist as well.
The company has tripled leased acreage to 70,000 acres for future drilling with plans to develop a deposit with between 10 million tonnes and 15 million tonnes of viable ore.
Foran shares, recently trading around 30 cents, and Murchison, around 8.5 cents, could turn into 10-baggers for patient speculators over the years ahead. Meanwhile risk of extracting the metal, and all other mining exploration risks from commodity prices to financing and mine construction make these shares risky.
CAUTION: Remember when investing, consult your adviser and do your homework before buying any security. Bizworld does not recommend investments.
Ron Walter can be reached at ronjoy@sasktel.net
