Exploration licence issued on Bell Island

Ed Byrne, Minister of Natural Resources, today announced an exploration licence has been issued to a company interested in seeking markets for the stockpiled iron ore on Bell Island.

Earlier this year, the Department of Natural Resources received a request from Provincial Energy Ventures Ltd. (PEV) to undertake advanced exploration work involving the removal of the iron ore that had been stockpiled near the former mine site, which had been abandoned in 1966. As a result of the expressed interest, the department was required by its legislation to issue a Call for Proposals, since the area in question had been designated Exempt Mineral Lands under the Mineral Act in 1977. The Call for Proposals was required in order for government to approve any exploration activity on Exempt Mineral Lands.

The Call issuance resulted in one proposal being received from R. Mercer Exploration and Development Inc. on behalf of PEV. Primarily, the company proposes to evaluate the potential for producing saleable iron ore from existing stockpiles. This evaluation will consist of a sampling program, during which the company will employ five people; the evaluation will cost approximately $155,000.

At this time, Minister Byrne indicated the company has only received a licence for exploration, which would permit the company to have the iron ore tested to evaluate the market potential of the stockpiled ore. Should this prove feasible, the company would then be required to seek a mining lease, the minister explained. As with any mining project in the province, the project will be administered under the Mining Act, and the company will be required to submit a development plan and a rehabilitation and closure plan containing a financial assurance proposal.

"I am pleased to see that a company does have interest in the iron ore of Bell Island," said Minister Byrne. "I look forward to seeing the results of this sampling program, which would determine whether there is potential for producing marketable iron ore from existing stockpiles on Bell Island."

Media contacts: Carmel Turpin, Communications (709) 729-5282, (709) 685-4624

Rod Mercer, R. Mercer Exploration and Development Inc., (709) 786-0428

2004 09 29             1:10 p.m.