BRITISH COLUMBIA – Fortune Minerals of London, ON, and partner POSCO Canada have sold their joint venture interest in the Arctos anthracite project to BC Rail for the sum of $18.3 million. The deposit is located in the Klappan area, 150 km northeast of Stewart. The joint venture partners have been granted the right to buy back the 61 coal licences for the same price within a 10-year period.
Fortune president Robin Goad put a positive spin on the sale, saying, "This is a good outcome for Fortune Minerals in the context of the current market. … considering the weak metallurgical coal prices at the present time, it was considered prudent to step back from Arctos and focus our efforts on our near term production assets. The back-in option allows for the repurchase the coal licenses should conditions improve and make development an attractive path forward for the joint venture."
The Arctos project has been hotly contested by aboriginal interests claiming the Klappan area is necessary to their lifestyle, even sacred. Ecologists weigh in on the side of the Tahltan Nation because the Klappan area is the headwaters of three salmon rivers (Stikine, Skeena and Nass). Fortune tried to resolve these issues, but was unsuccessful despite making an honest and expensive attempt.
Nor is the Arctos situation unique. Several mining projects have been halted recently due to the concerns of indigenous communities – Kemess North, Prosperity, New Prosperity, and Morrison. The fallout from the Mount Polley tailings spill is yet to be fully felt, and objections to reopening that mine will probably be made.
One interesting aspect of the Arctos sale is the BC government (after all BC Rail is a Crown corporation) has virtually washed its hands of the problem. According to BC energy and mines minister Bill Bennett, the Tahltan Nation how has a veto over development of these coal licenses. The province has ceded ultimate responsibility. If readers want to see the details of the sale, click here.
Fortune (FortuneMinerals.com), for its part, says it will take its $9 million from the sale of the coal licences and concentrate on its NICO gold-copper-bismuth-copper mine and mill development 160 km northwest of Yellowknife, NT.
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