The Nechalacho rare metals mining project has received a boost, as the company running the mine announced its first partnership.
This project would provide renewed economic output from a mining industry that is largely past its peak in the territory, according to economic analysis.
Avalon Mining, who own the project but have handed off operations to Australian mining company Vital Metals Limited — has received funding from Norwegian mineral extraction company REETecAs, in exchange for the near-surface resources on the property.
The deal is worth $5 million dollars. The mine will gather from deposits of rare earth minerals, including lithium, zirconium, beryllium, niobium and tantalum.
A feasibility study into Nechalacho was conducted in 2013, but the mine is yet to begin operations.
Don Bubar, president of Avalon Mining says there have been a number of delays in getting the project running, because of the territory’s “cumbersome and unpredictable regulatory process.”
“The regulatory system in Northwest Territories is a major disincentive for any mining company to invest in the Northwest Territories,” said Don Bubar, chief executive officer of Avalon.
Bubar said the regulatory system could discourage companies from pursuing future projects in the territory, including discouraging exploration activities.
In a statement when the partnership was announced, Bubar said he was delighted to see progress towards “initiating a new rare earths supply chain in Canada.”
We look forward to working with the team towards expanding production at Nechalacho, as demand for these critical materials continues to grow around the world,” Bubar said in a statement.