~Mineral Mining~

Mineral Exploration
The Key to Sustainability
by Paul Neufeld  

Uranium Exploration and Discovery Site, Saskatchewan
(Photo: Eagle Plains Resources Ltd)
www.eagleplains.com

The mining industry is making an impact on our province, and is bringing the attention of the world to Saskatchewan.  At the root of this boom, exploration and development are some of the key contributors to driving and maintaining a sustainable growth for our province.  Both senior and junior companies are at the forefront of this development, and serious dollars are being expended to explore and expand Saskatchewan’s resource sector.  Big risks and big gains.  That is the name of the game for many of these players.  But with all the time and effort, come the positive benefits and spin-offs impacting all of us. This is contributing to the trend of increased investment opportunity, and job creation in our province, of which is showing significant signs of strength and optimism to carry Saskatchewan and its residents forward for many prosperous years to come.  

Saskatchewan is becoming Canada’s newest headquarters for mineral exploration and mining, and several of the world’s largest players are making both a home and imprint here.  Companies like Cameco, AREVA, PCS, and Claude Resources are already located in Saskatoon, and the addition of mining mogul BHP Billiton boasts well for the reality of the expansion of existing mines, along with new greenfields mines being developed in the province.  These companies all have existing exploration programs and ties to other exploration companies in the form of joint ventures.  But in a large part, it is the junior and medium sized companies in town, and coming to our province, that are fueling the growth and aiding to make mining in Saskatchewan more than just a flash in the pan.  Names like Shore Gold, Great West Minerals, Athabasca Potash, Denison Mines, JNR Resources, Golden Band Resources, Hathor Exploration, Pitchstone Exploration, and Titan Uranium to name a few  are quickly becoming linked with the excitement surrounding the mineral and mining explosion occurring in Saskatchewan.  By 2004, the junior companies had surpassed the total exploration expenditures of the more robust senior companies, and in 2006 the junior mining companies in Saskatchewan contributed to well over half of the total exploration expenditures alone on greenfields exploration. There is large investment opportunity that exists, since most of these companies are publicly traded and/or operating in joint ventures with other large industry players.  

Mineral and Explorations Appraisal and Expenditures
(Photo: National Resources Canada)

Estimates of our current reserves project well into the next several hundred years, and the boundaries of our resources have yet to be fully understood and quantified.  Rising world populations and the increasing demand for food, along with the need for clean energy, are main reasons our resources are and will be sought after with such eagerness.  Currently, over 16 million hectares of our province is being explored for minerals.  This equates to 25% of the land in Saskatchewan.  Current estimations peg between 200 and 400 exploration companies in Saskatchewan.  Of the top 10 exploration companies currently in the province, 9 are Saskatchewan based.  Majority of this exploration is occurring in the northern and central portions of the province.  Most activity in the north occurs in the Athabasca Basin, where over 40 companies are actively searching for uranium deposits.    In the northwest region of the province, a looming giant exists in the form of the oil sands development that is currently being explored, and where field testing is being completed to confirm reserve sizes and opportunities for extraction.  Base metal exploration activity is currently being focused in the area west and southwest of Creighton.  In the central and southern part of the province potash is being explored, advancing on the staking rush which occurred over the last several years.  The Saskatchewan government indicated that there are over 130 potash mineral claims, with over one half being entered in 2008.  Diamonds and gold are also being explored in the central and northern parts of the province, while crude oil and coal exploration dominate the south eastern part of the province.  Of note is the Bakken formation, part of the Williston Basin in southern part of the province, which could be sitting on up to an estimated 100 billion barrels of oil.

Major Coal Deposit Discovery
(Photo: Gold Source Mines Inc.)
www.goldsourcemines.com 

Exploration is no easy venture, and there is a high risk involved in the industry since there are never any guaranteed returns.  Large amounts of capital are invested in order to finance the equipment, personnel, and obtain the necessary permitting to advance the exploration program.  Current averages show that it takes approximately 10 to 20 years to transition an exploration discovery into a producing mine, and that length is constantly increasing.  On top of that, it is estimated that fewer than 2% of these discoveries will actually evolve into mines.  So you can imagine how rich the potential is in Saskatchewan when many of these discoveries are leading to serious reviews and implementation plans for new greenfields mine operations.  In fact, Saskatchewan ranked #1 in Canada for greenfields exploration expenditures in both 2006 and 2007.  With high risk, comes big reward.  When a discovery leads to development and production, the potential payday for all of us is monumental.  Keeping in mind that is our duty ensure it is done in an environmentally sensitive and sustainable manner.  

The spin-off of all this exploration and development lies within the job opportunities, both direct and indirect, that benefits countless people in our province. Explorations have evolved from the gold pans and pick axes of days gone by into a highly developed and sophisticated science.   Exploration applies multiple disciplinary principles and processes to scan deep beneath the earth’s surface, and the tools and techniques to implement these processes have become very specialized.  The talent, skills, and organization required to execute and support exploration offer a wide array of employment opportunities.  An estimated 80,000 people will be needed within the next 10 years, with over 120 occupations to choose from.  Whether it is geology and geosciences, engineering, marketing, administration and accounting, the environmental sciences, health and safety, prospecting and drilling, or a limitless list of technicians and trades that interests you, opportunities in each lie within the mining and exploration industry. 

Over $1 Billion dollars has been invested in mineral exploration in Saskatchewan over the past 3 years.  In 2008, these expenditures reached a record of $474 million, with the majority being spent on uranium exploration, with diamonds, gold, base metals, and minerals following suit.  The current expenditures for potash and coal are quickly on their way to topping uranium and diamonds as the top exploration money getter, however due to the economic downturn, the 2009 expected exploration expenditures are slightly down. 

Worry not, because the positive effects and potential benefits of the mining and mineral exploration industry are still being experienced by our province and its people, and even more is in store just around the corner.