Jericho officially open for business
Brad Darbyshire: Create your own world
De Beers Canada and North Slave Metis Alliance sign Impact Benefit Agreement for Snap Lake
You can’t keep a good mine down
Jericho officially open for business
By Shirley Collingridge
Tahera Diamond Corporation held the official opening ceremony of its Jericho Diamond Mine August 17, 2006, with more than 140 guests in attendance.
Prime Minister Stephen Harper joins in the ribbon-cutting ceremony offically opening Tahera’s mine. (Left to right) Donald Havioyak, James Eetoolook, The Honourable Paul Okalik, Tahera Chairman and CEO Peter Gillin, and Prime Minister Stephen Harper.
“The official opening marks the creation of Canada's newest diamond mine and the first in Nunavut,” said Peter Gillin, Chairman and CEO of Tahera. “We are very pleased with the accomplishments of the Tahera team and look forward to many years of successful mining.”
Company officials say the historic event is the result of a collaborative effort by Tahera and its partners, coupled with the support of the local community and all levels of government. Construction of the Jericho Diamond Mine was substantially completed during 2005, with the first diamonds produced in January 2006. The company declared commercial production July 1, 2006. Consequently, the company was able to report continued improvement in all areas.
“Over the course of [the second quarter – the first one with production each and every month], we enjoyed continued improvements in both the metrics of tonnes processed as well as carats produced,” said Gillin. “The grade values increased as well, and significantly the GDE value subscribed to that production also improved.”
The target was to achieve two thousand tonnes per day, the rate of capacity of the plant. Production was slowed by crusher problems, with the replacement crusher due to be installed by the end of August.
Instead, “We achieved about 85% of that on average,” said Gillin, “about 1600 tonnes per day.”
During the second quarter, processed tonnes rose to 147,000 tonnes and 98,600 carats respectively, from 63,000 tonnes and 28,318 carats in the first quarter.
“One of the sparkling highlights of the quarter was the discovery of a 59-carat gem quality stone,” said Gillin, “very good shape, good colour, good clarity – at a value of in excess of $400 thousand US.”
This remarkable stone, now in the Tiffany facilities in Antwerp, is expected to be auctioned off.
The most recent production parcel from the Jericho Diamond Mine demonstrated an improved size distribution pattern over earlier parcels.
“We had $100 US average for that parcel which is the highest gem valuation we’ve had to date,” said Gillin.
In addition to the spectacular 59-carat gem, “We found two much lesser quality stones – one in the order of 100 carats and the other one slightly more than that – 103, which we suspect were originally one stone that got broken.”
Although the lower quality stones do not have the same integrity, said Gillin, “what is significant is that it confirms the existence of large, higher value stones in the Jericho pipe. So the original feasibility study is being validated.”
“On the exploration side, we completed a 900-tonne mini bulk sample,” he added. “We flew it out to Yellowknife and it has subsequently been shipped to Thunder Bay to the Rio Tinto facilities for processing. We expect results from that analysis later in the year.”
“The preproduction operating costs over the three months were about $12.12 million,” explained Gillin. “The diamonds realized or to be offset against that was about $10 million in the quarter, progressively improving month over month in that time frame, such that by the time we got to June the production value exceeded the related cash costs.” Earlier, the company estimated increased costs of $3 million due winter road problems because Tahera had already received 60% of its planned loads and more than half its planned fuel supply before the shutdown.
“Our fuel consumption rates have been good so that we are comfortable and will be able to get to the next winter road without any costly imports or flying in volumes of fuel oil,” said Gillin.
“We are hopeful that we don’t have the same kind of constraints on the winter road that we had last year,” he added. “We are trying to plan as best we can to maximize our deliveries over the winter road period, whatever that period is.”
Tahera traffic makes up about 3% of the winter road’s traffic.
The company continues its program at the Muskox Kimberlite, after extracting the 900-tonne Muskox kimberlite bulk sample and shipping it to Rio Tinto's diamond laboratory in Thunder Bay, Ontario for processing. Thanks to expenditure costs over the $11 million threshold, Tahera also earned its 50% interest in the Polar Claims through its joint venture arrangement with De Beers. The most prospective kimberlite in that parcel is the Muskox.
“We are happy with the outcome at this stage and we look forward to continued improvement in these results as the year carries on,” said Gillin.
Tahera Diamond Corporation (TAH:TSX) is a Canadian diamond mining company headquartered in Toronto, Ontario. The Jericho diamond mine, forecast to produce 500,000+ carats per annum over the mine-life, is located in Nunavut approximately 400 kilometres northeast of Yellowknife, NWT.
Brad Darbyshire: Create your own world
By Shirley Collingridge
Today, Brad Darbyshire manages Points Athabasca Contracting Ltd. (PACL) but five years ago, the Cree man who grew up in Buffalo Narrows was out of work. He had just received his papers as a journeyman heavy-duty mechanic when he received a second piece of paper: a lay-off notice from his job at the Cluff Lake Mine in northern Saskatchewan. Darbyshire viewed the lay-off as an opportunity.
Brad Darbyshire
While working at miscellaneous jobs in Saskatoon, he began developing business plans.
“I was doing applications through ABC, through the Métis Society, et cetera and I was accepted at most of those for funding,” he said. The time had come to make a decision.
“I phoned up the vice president of Graham Construction, Brian Lueken,” explained Darbyshire. “I had met him in previous years once or twice and learned that he was fairly high up in the construction company. I asked him for insight and his thoughts on my business plans.”
Not only did Lueken advise Darbyshire on the business plans, he offered him a job. Lueken was looking for “an entrepreneurial type person with a First Nations background from the north who especially knows equipment and the mining industry,” said Darbyshire. “I kind of fit the bill for this new company they were getting into, called Points Athabasca Contracting, a partnership between the Athabasca Group, Athabasca Basin Development Limited Partnership, and Graham Construction. They needed a manager.”
Darbyshire knew he was qualified except:– he had no management skills. “I never went to school for management, had never taken supervisory courses,” he said.
Darbyshire applied anyway. After three interviews, he became impatient: he had more immediate options. “I got an offer to go work at Fort McMurray at Syncrude as a mechanic,” he said, “they typically look for First Nations people. So I gave [PACL] the option: hire me today or I am going to Fort McMurray.”
PACL hired him. “That was five years ago,” said Darbyshire.
Since then, the manager has improved his management skills. “I have taken different leadership courses that they sent me to in Edmonton. I have taken the Business Administration (BAC) Certificate through the University of Saskatchewan, Commerce division,” he said. “As well, I am taking a Project Management Professional course in January through the University, which will qualify me to write the PMI - Project Management Institute - exam. That is a sought-after designation in the construction and business world right now.”
Darbyshire shouldered some of the training time and costs himself; PACL covered the rest. Even though he had left Buffalo Narrows at age 11, Darbyshire was already aware of the opportunities presented by the mining industry.
“It plays a big part in the north,” he said, “so I was familiar with it somewhat. Growing up, most of our fathers worked in the mine. Mine still does. He did then; he does now.
“Out of high school, I worked as a summer student at Cluff Lake as well, doing their warehousing and things like that,” he added. “It is a good opportunity and obviously the income is there and the future is good with that industry.”
Now he is “strictly management. “When I went into this position, I got out of the hands-on and started doing the hiring of mechanics,” he said.
So today, Darbyshire considers himself a hobby mechanic – rebuilding his own engines and transmissions at home. “I have a full set of tools that I don’t let collect too much dust. So the trade stays with me,” he said.
In the early days at PACL, Darbyshire spent a lot of time away from home.
“The first four years, I spent upwards of probably 70% of my time up north. As the years progress, it is less and less,” he said. “The second year was probably 50%, third year was probably 40/45%.”
Now the PACL has a human resources department, Darbyshire has five employees under his supervision, and he has built important relationships in the north, making his job far easier.
“Today I go up north every two weeks, probably for overnight,” he added.
Darbyshire would unwilling to leave his growing family in Saskatoon for long periods away. “I have one son that is a year and a half and I have another due next month. It has made my drive in my job even stronger, based on having those commitments and responsibilities,” he said. “If I cannot go home at night, – it does not have to be every night - but I would have to make a career change. I have to have a balance.”
Instead, he spends most working hours in his Saskatoon office. “A typical day here is a lot of human resource management based on a mandate within Points Athabasca in hiring First Nations and specifically Athabasca residents from the seven impact communities,” said Darbyshire. “There is a focus on that, a lot of discussions with the Athabasca Group and Athabasca Labour Services on a daily and weekly basis. [Our] human resource department does the hiring now but they need guidance on what to do. That takes up a good portion of my day,” he said.
He also spends much his day planning projects like the precast project in Points North Landing, site services contracts, and most recently, a road maintenance contract to maintain Cigar Lake’s new 57-kilometre road from highway 905.
“We have a lot of initiatives on the go,” he said. “Right now at Points Athabasca Contracting, we have around 320 people working.”
For those interested in a career with PACL, Darbyshire advises, “What we look for is not somebody that is necessarily highly trained in a certain technical area. Just work hard and be open to try anything. If you can do that, people notice. It is no different than the role I came into. I did not have management experience. They said, ‘You have 50% of the equation; the other fifty we think you can learn.’”
So, added Darbyshire, “You come into an interview, you show confidence and you show you are willing to work. It will get you in the door right away.”
“I believe you can create your own world, he concluded. “You do not have to have it brought to you. It can be put in place by your own actions. It is similar to where I am now – comes all the way back to having that drive where I said I am going to open my own business. Even though I didn’t, I am running a business. And if I was to leave here today, I would open a business. I would still be managing.”
Alcan enjoys banner year
By Shirley Collingridge
Alcan Inc. is enjoying a banner year and it is sharing the wealth. Among its successes, the company can count its highest quarter in history for the second consecutive time, new alliances, and major renovations at its Kitimat, BC smelter.
Aluminum Smelter Upgrade to Create Three Thousand Jobs
Alcan Inc. plans to spend US$1.8 billion to upgrade its aluminum smelter in Kitimat, creating 2,000 temporary and 1,000 stable, full-time jobs in the community near Prince Rupert in northern B.C.
The upgrade will raise production of the plant by more than 60 per cent, up to 400,000 tonnes from 245,000 tonnes annually. It will also increase the company's annual production of primary aluminum by more than four per cent.
Subject to company and regulatory approvals, the smelter is due to come on stream in 2009. Once the project is complete, the Kitimat facility will be one of the three largest aluminum smelters in North America.
The project “would make Kitimat a world-class aluminum production facility for the next 35 years and beyond,” said Marco Palmieri, president of Alcan's regional primary metal group. “Alcan's intention to invest in British Columbia reflects the province's competitive business climate, one which will contribute to Kitimat's economic vitality.”
Sustainable Waste Solution for Nuclear Industry
The question of safe nuclear waste disposal has plagued the industry for decades. Alcan’s recent agreement with Ceradyne Canada to supply boron composite may facilitate the solution. The agreement is for the supply, distribution and technical assistance of BoronMMC (a unique boron carbide metal matrix composite) from Alcan’s Dubuc Works. The material, say company officials, safely packages spent nuclear waste material. The agreement also provides for the exploration of other markets for metal matrix composites produced at Dubuc Works, which focuses on the production of high value-added aluminum products.
“Alcan is proud to have developed a sustainable, innovative, safe solution for packaging nuclear waste through the use of its high value-added composite like BoronMMC, improved and commercialised here in Saguenay-Lac-Saint-Jean region,” said Jean Simon, president of Alcan Primary Metal, Quebec and United States.
“Alcan’s industrial development office served as a catalyst between the partners,” added Julien Gendron, director, Regional Industrial Development, Alcan Primary Metal Group. “Ceradyne is not only investing a considerable amount and creating jobs, it will also enable the Saguenay–Lac-Saint-Jean region to consolidate its presence in the area of aluminum fabrication,” he added.
Ceradyne Inc. (NASDAQ: CRDN) is an American company specialized in developing, producing and marketing advanced technical ceramic products and components.
Product Exhibits Exceptional Strength, Ductibility
Recently, Alcan Inc. also announced a joint marketing and manufacturing agreement in principal with Mercury Castings.
“Alcan will make, sell and distribute Mercalloy through its existing domestic and global distribution network,” said Jean-Francois Laplante, Director, North American Foundry Products, Alcan Primary Metal Group.
Mercalloy is a patented family of alloys developed for the die-cast and permanent mold industries. Among its applications, Mercalloy is found in aluminum propellers and Verado engine drive shaft housings, designed to ensure maximum design life and performance.
“The joint-commercialization of Mercalloy will offer existing Alcan die-casting customers a new high-value product range and application opportunities,” said Laplante.
“Mercalloy exhibits exceptional strength, ductility and part integrity,” said Dave Olson, Mercury Castings General Manager, “and through Alcan’s global reach and technical excellence, we will be able to introduce Mercalloy into markets beyond the marine industry, such as automotive, aerospace structural, and agricultural vehicles.”Mercury Castings is a part of Mercury Marine, a division of Brunswick Corporation. Headquartered in Lake Forest, Illinois.
Record First-Quarter Earnings Sustained in Second Quarter
In May, Alcan Inc. announced exceptional earnings – the highest in the company’s history.
“High prices for aluminum and excellent operating performances across most of our businesses combined to make this an outstanding [first] quarter for Alcan,” reported Dick Evans, President and Chief Executive Officer, Alcan Inc. “By any measure, earnings for the period were the highest in the company’s history.”
Benefactors Share in Alcan’s Success
The company is pleased to share the wealth not only with investors, but with its more than 65,000 employees worldwide, and benefactors. Benefactors include the free outdoor program for the 2006 Festival International de Jazz de Montréal, and Australia’s Charles Darwin University, which received an AU$600,000 grant. Alcan (NYSE, TSX: AL) is a leading global materials company, delivering high quality products, engineered solutions and services worldwide. In September 2005, the company was selected as a Super-Sector Leader on the Dow Jones Sustainability World Index (DJSW World). It was the fifth time in six years that Alcan has been selected as a member of DJSI World, a ranking that tracks the performance of global companies leading in the field of sustainability. For more information, visit: www.alcan.com.
De Beers Canada and North Slave Metis Alliance sign Impact Benefit Agreement for Snap Lake
The North Slave Metis Alliance and De Beers Canada Inc. are pleased to announce that they have signed an Impact Benefit Agreement for the Snap Lake Project in the Northwest Territories.
This agreement formalizes the NSMA’s participation in the Snap Lake Mine through the establishment of business contracts, training and employment opportunities, scholarships and financial benefits.
“Our vision is to ensure our businesses are creating opportunities for our People,” said Bill Enge, President of the North Slave Metis Alliance. “In negotiating this agreement, our focus was on supporting the development and growth of business opportunities, with a view to investing a significant portion of the profits earned by our businesses into scholarships, training and educational opportunities for our members.”
“Concluding this Impact Benefit Agreement clearly establishes how the North Slave Metis Alliance will participate in and enjoy the success of the Snap Lake diamond mine,” said Mr. Chantal Lavoie, Vice President–NWT Projects. “Our Agreement enables the North Slave Metis Alliance to move forward with their new shotcrete business, and we look forward to being their first major customer.”
Speaking to members of the Board of Directors of the North Slave Metis Alliance, De Beers President and CEO Jim Gowans said, “Our business relationship will bring benefits to both organizations and will support the long term aspirations of the North Slave Metis Alliance. That is something both negotiation teams can be proud of today.”
This is the third Impact Benefit Agreement concluded by De Beers for the Snap Lake Project. The first one was completed with the Yellowknives Dene First Nation in November 2005 and the other with the Tlicho Government in March 2006.
The Snap Lake mine will employ 500 people during full production and will produce 1.5 million carats per year. It will be the first completely underground diamond mine in Canada and De Beers’ first mine outside of Africa. The project is under construction and scheduled to begin production in October 2007.
You can’t keep a good mine down
By Shirley Collingridge
“Despite all the challenges created by the premature ice road closure, mining and construction activities are moving forward as planned,” said Mark Anderson, President pf Diavik Diamond Mines Inc. (DDMI). “This is due in no small part to our hard working and creative workforce, but we have been helped tremendously by a major airlift program.”
For the first time in its 20-year history, the ice road closed prematurely. The 568-kilometre road runs over a series of lakes interconnected by 64 portages; 75 to 85 percent is built over water. It serves as the main supply road for the Diavik diamond mine as well as several other mines and exploration projects. Companies typically ship a full year’s supplies over the winter road. Despite innovative efforts, the road never did reach its usual 42-inch thickness, which meant traffic had to slow, putting deliveries behind schedule. Undelivered loads had to be placed into storage, returned to tankage, or shipped south for repackaging and later delivered by air.
The company developed an Ice Road Recovery Plan around a major airlift program, as well as a conservation program to reduce the amount of supplies needing airlifting, especially fuel. One planned strategy was to preserve 2.6 million litres of fuel burned in part by idling vehicles. The company also developed a three-part plan to fly in essential supplies.
Part one of the plan was to replace a critical piece of equipment.
“We lost a ‘shovel’ to a fire at Christmas,” said Anderson.
The massive shovel was one of only two at the minesite. Replacing it would be no easy task because this equipment is in high demand and low supply. Fortune smiled on Diavik when another company cancelled its order for a Terex O&K RH200 shovel coming off the assembly line in Germany. Boat, rail and regular road brought the 500-tonne hydraulic excavator as far as Yellowknife, only to be foiled by the impassable winter road. No aircraft was large enough to carry the massive shovel into camp.
“Thanks to some very dedicated workers, cutting torches, welding machines and a unique helicopter, we now have a brand new shovel operating. This is a remarkable piece of work, never done before, and ahead of schedule with no accidents,” said Anderson.
Diavik’s team cut the shovel into helicopter-sized loads, and then used the world’s largest helicopter, a Russian Mi-26 to fly the pieces to site. By late June, the reconstructed shovel was busily digging rock in the open pit.
Part two of the airlift program entailed flying in hundreds of large bags of cement and bentonite required to keep the A418 dike construction on schedule. Diavik contracted Canadian North’s Boeing 737 and a Russian Antonov AN12 to fly around the clock. The dike construction is right on schedule.
Phase three entailed flying in diesel fuel, bags of ammonium nitrate to make explosives, and the myriad of other supplies required to keep operations going for the rest of the year.
In the meantime, the project needed to keep its employment numbers on target in the fiercely competitive human resource market. Nearly 70% of Diavik’s workforce currently comes from northern communities. Anderson feels the company is on track but needs to keep up the progress.
“We are tackling this with a number of training program investments,” said Anderson. “One of our upcoming challenges will be to find northerners ready, willing and able to work underground.”
The company recently launched a second Aboriginal Leadership Development Training program, developed in partnership with SAIT. For the first time, Diavik also offered an Underground Miner Training (UMT) program. All UMT graduates were hired by the company’s mining development contractor, Kitikmeot Cementation Mining and Development.
“Seven new Aboriginal and Inuit graduates are showing us the way forward and, with their formal training behind them, have now been hired as miners on our underground feasibility program,” said Anderson.
Water licensing delays also plagued the company as the Tlicho’s Wek’eezhii Land and
Water Board delayed public hearings by two months so that the board can request additional information from DDMI.
Despite this quarter’s challenges, the company continues to see success.
“Throughout the operation, everyone’s focus on safety has boosted us ahead of our goals this quarter and our attention to safety has paid off in another way, as our Mine Rescue Team won the Mine Rescue Underground Competition for their first time,” said Anderson.
Even though the team was technically a winner, Diavik did not get to take home the gold The Diavik mine rescue team, competed against the Ekati team in the underground portion of the 40th Annual Mine Rescue Competition and the teams tied for first on points. One event was picked from a hat to break the tie; as luck would have it, the event chosen was one in which the Ekati team had scored best.
“It’s been a good three months,” Anderson concluded, “with many new challenges faced and overcome. I’m very proud of how our Diavik workforce has risen to the challenges.” The successful second quarter once again proves: you can’t keep a good mine down.
The Diavik Diamond Mine, located 300 kilometres northeast of Yellowknife, Northwest Territories, is an unincorporated joint venture between DDMI (60%) and Aber Diamond Limited Partnership (40%). Both companies are headquartered in Yellowknife, Canada. DDMI is a wholly owned subsidiary of Rio Tinto plc of London, England, and Aber Diamond Limited Partnership is wholly-owned by Aber Diamond Corporation of Toronto, Ontario. DDMI is the operator of the project. For more information, visit www.diavik.ca.