One of the world’s largest mining companies is spending millions of dollars to look for copper in northern Saskatchewan — and could commit tens of millions more if its engineers and geologists like what the drill rigs uncover.
Rio Tinto Exploration Canada Inc. spent the summer taking core samples at the Janice Lake copper deposit north of La Ronge after signing an option agreement with Forum Energy Metals Corp., which acquired the property in 2017.
Under the terms of the agreement, Rio Tinto can spend up to $30 million over seven years to acquire an 80 per cent stake in the property, which was staked in the 1960s and bounced between companies before ending up in Forum’s portfolio.
Rick Mazur, who started the Vancouver-based junior in 2004 to explore for uranium in the Athabasca Basin before decided to diversify, said preliminary drill results have been positive and the future for copper mining is strong.
“Copper is going to be the mother of all energy metals with the new electric economy we’re building,” he said, adding that the company “scraped together $400,000 lousy dollars” to drill four holes, the results of which piqued Rio Tinto’s interest.
At the same time, he acknowledged that mineral exploration comes with no guarantees and plenty of risks. Although it was discovered in the 1960s, comparatively little geological work has been done on the property to date, Mazur said.
“We don’t know what’s really there until we get in and drill the hell out of it,” he said of the “sedimentary copper” deposit he figures was, billions of years ago, formed alongside the massive Udokan deposit, which is now in Siberia.
“What Rio Tinto sees in it is size,” he said, adding that only a small portion of the property has been drilled.
If an eventual feasibility study finds the project to be economically sound, Mazur said, the plan would be to build an open pit mine. Asked about possible timelines, he said a typical mining project takes eight years to bring into production.
Rio Tinto, which referred a request for comment back to Forum, is regarded by mining industry insiders and investors as a serious player whose involvement suggests its experts believe there is a real chance the project could come to fruition.
While the risks are considerable and the timelines long, Rio Tinto’s interest is nevertheless welcome news to the mayor of La Ronge, who has seen the northern town affected “big time” by the temporary closures of two Cameco Corp. uranium mines.
Ron Woytowich said any mining project north of La Ronge would be welcome news for the community, because the industry provides good, well-paying jobs and miners’ families also come into and contribute to the local economy.
“This is big for us,” Woytowich said before acknowledging that early-stage exploration projects come with little certainty.
Janice Lake is not the only Saskatchewan project in which Rio Tinto is involved. Two years ago, the company signed a similar deal worth up to $75 million over seven years with Shore Gold Inc., which has since been renamed Star Diamond Corp.