‘Too soon’?: Quebec miners expect high costs, lower production as sector stirs back to life

After spending much of his career travelling to remote and primarily tropical corners of Africa, Gary Kobinger finally boarded a plane bound for the frigid tundra in Nunavut two weeks ago.

It was early April and Agnico Eagle Mines Ltd. had recruited Kobinger, an infectious disease expert with nearly a decade of experience at the Public Health Agency of Canada, to set up a mobile lab so it can test for COVID-19 at Meliadine, its largest mine in Nunavut.

In March, the company scaled back operations at the mine after local residents staged a roadblock to protest the risks posed by flying workers in. Since then, the Nunavut-based workforce is no longer coming to the mine and the workers that are flown-in are not interacting with the community.

But with no date in sight for when the coronavirus threat will pass, the company is laying the groundwork for an eventual resumption of operations.

• Barrick Gold buys 800,000 COVID-19 antibody test kits
• Gold miners usually shine during a crisis — but not when they can’t work their mines
• Rio Tinto says its operations in Quebec to slow in response to COVID-19 measures

Instead of waiting for COVID-19 test samples to travel thousands of kilometres to a lab in lower Canada, the company can know within a matter of hours if someone on the site is infected. So far, after taking upwards of 700 tests, Kobinger said there have been no cases of coronavirus in the remote mining camp.

“It doesn’t mean there won’t be any cases,” Kobinger, director of the Research Centre on Infectious Diseases at Université Laval, told the Financial Post. “I wouldn’t be surprised if we have one or two, actually I expect it. But if we find something, we’ll be there, as opposed to waiting 10 days.”

Kobinger estimated the test is costing the company $100,000 per month, and as the lab’s qualified as a diagnostic facility, it has enabled the company to obtain online the necessary chemical reagents to conduct tests, and from public health labs in Ontario and Quebec. Now, he is in the process of expanding testing to other mines around Canada.

Even the most accurate tests still miss some cases, however, and medical experts in Nunavut have warned that tests should not inspire false confidence or substitute for self-isolation and quarantine.

It’s one example of how the sector is powering through the pandemic, often accepting higher costs and operating at reduced capacities, and occasionally leading to friction with the local communities about the risks. Mining companies have already experienced outbreaks of COVID-19 at sites, contained infections and faced close calls. Yet operations are already scaling up in Canada.

This week, the Quebec government followed Ontario and British Columbia’s lead and designated mining as “essential.” It means that mines across the province, including a handful of gold mines near Val d’Or, Que. — a region where more than 138 cases of COVID-19 have been confirmed — are gradually reopening.

George Burns, chief executive of Eldorado Gold Corp., which operates a mine in Quebec, said his company was forced to put its mine on care and maintenance for about three weeks. But there was a lot of dialogue with provincial authorities and industry groups about reopening mines in the area again, and many companies plan to rely exclusively on their local workforce at least initially.

“I think all that constructive dialogue resulted in the decision to allow the mines to restart,” said Burns. “As an industry, we did a really good job of sharing safety practices.”

His company, like many others, is using thermal cameras to check temperatures of workers when they arrive, and has a questionnaire to screen out potential infected individuals.

Still, there have been objections to the restart of mining in Quebec.

Ghislain Picard, chief of the Assembly of First Nations Quebec and Labrador, said the restart feels “too soon,” and he would like to have seen the infection curve flatten more.

Picard said several dozen Indigenous communities have shut down access to outsiders in an effort to keep the virus out, but mines where workforces are being flown in pose new threats.

He noted there’s a variety of opinions in most communities about how long current lockdown conditions need to last. Many Indigenous leaders feel torn between the responsibility to protect the most vulnerable members of their community, and pressure to help out single parents or others for whom the lockdown has been extremely trying.

“It’s been difficult,” Picard said, “There’s a lot of pressure on the leaders to convince everyone that this is the only way to stop the spread of COVID-19.”

Still, most mining executives agree with him on one thing: It’s not clear how or when conditions will ease.

Across the country, situations vary widely. Some mines are located in remote camps where shifts last days, while others rely on workers that return to their homes each night.

Tony Makuch, chief executive of Kirkland Lake Gold Inc., which operates mines near the Quebec-Ontario border, said the restrictions on interprovincial travel have reduced the available workforce. As a result, the company is still mining gold, but it has had to postpone major operations, including the sinking of a new shaft at its Macassa mine.

The company is staggering shifts, so it can send more people underground without crowding everyone into confined spaces, particularly the elevator on the way down, he said.

Meanwhile, its remote camp, Detour, has been operating at around 70 per cent capacity even though the number of people has been reduced from around 1,100 pre-pandemic to just about 300. Makuch said some employees have elected to stay at the remote camp for a month, taking a few days off but deciding it was safer there than heading back home.

The company also operates a mine in Australia, and Makuch questioned whether he would be able to travel there as much as in the past.

“Am I going to fly to Australia six times a year? Probably not,” he said.

Barrick Gold Corp.’s chief executive Mark Bristow said his past experience dealing with outbreaks in Africa of Ebola, tuberculosis and malaria helped him prepare for the current pandemic. The company also has been purchasing protective equipment, and antibody testing kits.

“I think we’re only partway through it,” said Bristow, “It’s a long haul.”

Still, he said the company has been managing ably, and is “within range” of the guidance it issued at the start of the year in terms of its production and costs.

Wesdome Gold Mines Ltd. operates a mining camp in Wawa, Ont., which remains open, but its advanced exploration project near Val D’Or remains closed and could reopen in May, said chief executive Duncan Middlemiss.

So far there haven’t been COVID-19 outbreaks within the company, but it’s been confusing as infected people may be asymptomatic but still contagious.

“We’re always worried about the second wave,” said Middlemiss. “We were talking today, you know when will we get back to normal? I’m sure we will, but I’m just not sure when.”

Financial Post

• Email: [email protected] | Twitter: GabeFriedz