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Gold mine looms large north of Terrace, B.C.

A PROPOSED massive gold mine north of here has the potential to help BC Hydro recoup some of the $736 million it’s spending to build the Northwest Transmission Line.

Seabridge Gold, now nearly two months into a 180-day governmental environmental review of its  Kerr-Sulphurets-Mitchell (KSM) project near Stewart, would need approximately 177 megawatts of power to run its mine.

That’s nearly half of the 375 megawatts BC Hydro says its transmission line can supply when scheduled to be completed next year.

While Seabridge plans to supply some power from a small hydroelectric plant on its property, it would still need approximately 171 megawatts from BC Hydro.

Under a special tariff approved last year, BC Hydro will charge companies a dollar amount proportionate to the amount of power they’ll take from the line. They’ll still need to pay for the power itself.

BC Hydro is subtracting the $130 million federal grant it’s receiving to defray costs and the $180 million it will get from AltaGas so it can flow power to the line from three run of river projects it’s building in the area.

But that leaves $426 million BC Hydro needs from other companies to break even on a project which has had a steadily-increasing price tag since construction began.

At Seabridge’s planned power demand, the amount it would then pay works out to approximately $195 million.

While Seabridge chairman Rudi Fronk said it would be premature to discuss costs because it is still in discussion with BC Hydro, BC Hydro officials confirmed the basics of the tariff structure.

“However, project loads sometimes change as the project develops,” added BC Hydro officials in an email, “so we cannot comment on the KSM load or, by extension, on the amount that would be paid through the … tariff if the KSM project proceeds.”

Fronk did say Seabridge has been in discussion with BC Hydro since 2009 and that it did pay for a  study to set out how a Seabridge power line from its mine site would tie into the transmission line.

“Since then, BC Hydro has ordered intertie structures and are proceeding with engineering and purchases …,” said Fronk.

BC Hydro said doing that connection work now is cheaper than doing it after the transmission line is completed.

The size and duration of Seabridge’s mine has one Terrace city councillor urging people to learn more about the project.

“This project is massive,” said Brian Downie who toured the project Sept. 9. “There are reserves there for 52 years of mine life. That’s multi-generational. That’s as many as three generations.”

In addition to gold, Seabridge said the KSM location holds silver, copper and molybdenum.

Downie said the company would need several thousand  workers during the construction phase.

Seabridge has been using Smithers as a base for an office but Downie said company officials have told him that should a mine go ahead, the company would open an office here.

The Kerr-Sulphurets-Mitchell property had been explored before but Seabridge began an intensive drilling program after acquiring it in 2006.

Seabridge is also looking for a project partner with the kind of deep pockets that would be needed to finance construction.

Seabridge and the Nisga’a Lisims Government have also announced what they call an “agreement in principle on material components of a benefits agreement” for jobs and economic opportunities stemming from the proposed mine.

Details were not released.

The tailings pond area of the project is within Nisga’a traditional territory but not within the core lands provided the Nisga’a as part of their 2000 land claims agreement.

The Tahltan and other first nations in the area have asserted claims over all or part of the project area.

Seabridge is holding an information session Oct. 1 at the Northwest Community College from 4:30 p.m. to 8 p.m.

 

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