Saskatchewan sees golden potential for precious metals mining and more
JOEL SCHLESINGER, POSTMEDIA CONTENT WORKS
Published on: January 8, 2018 | Last Updated: January 8, 2018 1:52 PM PST
The Santoy gold deposit at the Seabee Gold Operation in northern Saskatchewan attracted Vancouver-based mining company SSR Mining, which purchased the operation in 2016.
SSR Mining may be a Vancouver-headquartered company, but lately its attention has been firmly focused on a large stretch of land in the middle of the wilderness in northern Saskatchewan.
That’s because the mid-tier mining company with two other operations in Nevada and Argentina sees a golden opportunity in the prairie province — literally.
Its recent purchase of Saskatchewan’s only gold mining operation speaks to SSR Mining’s confidence of what lies beneath the Land of Living Skies.
The company acquired Claude Resources, and with this the Seabee Gold Operation, for approximately C$337 million, the largest single investment in precious metal mining in the province’s history.
“The previous company had operated the Seabee mine for about 25 years,” says SSR Mining’s president and chief executive officer Paul Benson. “The first 23 years were quite routine, mining lower grade deposits.”
But then exploration efforts uncovered a nearby deposit of much higher quality gold ore, and that caught the attention of SSR Mining, prompting the friendly takeover.
Today, the company is mining the higher-grade Santoy deposit, just a short trucking distance from the original Seabee mine and mill complex.
“By far the majority of the gold is in the Santoy deposit,” he says, adding the operation currently has total mineral resources of over one million ounces of gold.
Saskatchewan is a heavyweight in the mining world. Being the No. 1 producer of potash globally and No. 2 for uranium, the province has a long history of mining innovation while providing highly skilled people adept at extracting minerals from the earth.
Yet the province has largely flown under the radar when it comes to base and precious metals and other valuable minerals, including diamonds. That, however, is changing rapidly as exploration and mining companies turn their attention to the province’s bounty underground, especially after SSR Mining made its big splash last year.
“We believe we have significant unrealized potential for other mineral commodities such as base and precious metals and also diamonds,” says Gary Delaney, chief geologist at the Ministry of the Economy for the Government of Saskatchewan.
That’s in large part why the province has devoted considerable resources to help interested mining firms explore its potential.
Efforts include scanning millions of pages of historic industry technical reports and maps, as well as geoscience publications prepared by the provincial government, over several decades. All of this information is available through the government’s recently launched Mining and Petroleum GeoAtlas: “A one-stop shop to get all the technical geological information for the industry,” says Delaney.
It’s this kind of support that exploration and mining firms find helpful when looking for investment opportunities.
“Rather than reinvent the wheel, companies want to build on existing data and these resources provide an important foundation.”
“With precious metals, there have been several past gold mines in what’s known as the La Ronge Gold Belt,” Delaney says, although their size and scale have been modest by today’s standards.
Moreover, SSR Mining’s Seabee operation has produced more than 1.3 million ounces of gold since it was founded in 1991.
A little farther east, at the border with Manitoba, the Creighton/Flin Flon area hosts some of Canada’s richest deposits of base metals — copper and zinc — which also contain significant concentrations of gold and/or silver.
“The largest of those ore bodies, the Flin Flon mine, which straddled the border of Saskatchewan and Manitoba, not only had significant base metal, but the Saskatchewan part of the deposit contained about 3.6 million ounces of gold,” Delaney says.
In fact, the first gold discovery in the province occurred just southwest of Creighton in 1916 near Amisk Lake. The potential bounty in the ground, however, doesn’t just include precious and base metals.
Potentially rich deposits of diamonds near Prince Albert in central Saskatchewan have attracted interest from large mining multinationals.
However, the region generating the most buzz these days has been in and around the Seabee and Santoy mines.
“It’s not just the million ounces in resources we’ve identified so far,” Benson says.
SSR Mining has teamed up with another company, Eagle Plains Resources, to explore the 34,000-hectare Fisher project south of its Santoy property.
Should their efforts bear fruit, they will benefit from an incentive program previously put in place by the province to reduce the cost of development, by offering a 10-year royalty holiday on new base and precious metal mines.
Delaney says activity thus far is merely scratching the surface (pun intended).
“We’re frequently going to places like China, actively promoting investment opportunities here,” Delaney says.
“That’s because we feel we have significant unrealized potential in base and precious metals, and we would love to see that potential realized someday soon.”