BUCHANS, N.L. — The old Buchans mine in central Newfoundland was extremely active for several decades prior to closing in 1984.
Now, a company that’s been looking at the site for more than 10 years hopes a Swedish company with mineral expertise and cash holds the key to its future.
Buchans Resources Ltd. recently announced an agreement with Boliden Mineral AB that will see the latter company evaluate its volcanogenic massive sulfide metals property at the site of the old mine. A one-year exclusivity agreement takes effect for the duration of 2021, with Boliden contributing $600,000 to Buchans Resources to maintain the property and conduct ongoing exploration and evaluation programs. Buchans Resources will not entertain any third-party interest in the project during that time, giving Boliden until the end of 2021 to decide whether it wants to negotiate a further deal.
Paul Moore, vice-president of exploration for Buchans Resources and its subsidiary company Buchans Minerals Corporation, said the local company has largely been interested in low-grade ore, poring over old data stored in a provincial government drill core library in Buchans. He admits that work has been challenged by financial and technical resources at their disposal.
“The Boliden part is important simply because their expertise in near-mine site exploration is established,” he said, acknowledging that company’s success in Sweden and Ireland. “For us, we’re partnering with a more technically robust company with the acknowledged experience to help move this project forward in a meaningful way.”
Commodity super cycle
How far forward that project moves will depend on what Boliden sees in the data. The Financial Post recently reported that a number of financial analysts see potential for a new commodity super cycle, with the price for minerals like iron ore moving upwards as fiscal stimulus funds become available in a world recovering from the COVID-19 pandemic.
“If we find resources that are mineable, it would certainly have an impact on Buchans,” Moore said, adding the company hopes this work can lead to significant employment for the area. If exploration were to prove successful, Boliden would have the technical and financial abilities to advance the project, he said.
Ultimately, the hope is if the data looks good, Buchans Resources and Boliden can eventually “explore together in a more substantial way,” Moore said. In this case, the focus will be on locating high-grade ore similar to what was mined in the area previously.
“Most of our work in the last 10 years has been focused on low-grade resources near surface that were left behind by past mining,” Moore explained, noting Buchans Resources has focused a lot of its past efforts on the Lundberg stockwork sulphide deposit.
“These guys, Boliden, are more focused on finding new high-grade deposits. Something large and high-grade that for a company of their size would make a difference to their bottom line. It’s a world-class camp. Among the richest and highest-grade deposits ever mined on the planet in the category of (volcanogenic massive sulfide) deposits.”
Prior to the mine’s closure in 1984, it was a known entity for zinc, lead, copper, silver and gold.
Busy area
Buchans’ mining history is strong and there are other active projects in the area, including Marathon Gold’s Valentine Lake project and Barite Mud Services’ ongoing work to recover barite from the tailings remaining from past mining operations. Mayor Derm Corbett considers Buchans Resources’ exclusivity agreement with Boliden excellent news.
“We’ve been advised and informed for many years now that there is a great deal of ore remaining in this area,” he said. “It’s low-grade ore, but as markets change and markets improve, we see all kinds of possibilities here.”
While life has not always been easy for people living in the community in recent decades, Corbett said continued investment in the mining sector increases the general sense of optimism surrounding Buchans’ future.
Andrew Robinson is a business reporter in St. John's.
