APTN News: Yukon government has confirmed traces of cyanide have been detected at the Eagle Gold mine site near the community of Mayo, though its findings seemly go against an announcement from the mine’s owners earlier in the day that no cyanide had been found.
According to Yukon’s mining minister, elevated levels of cyanide have been detected in a waterway after an equipment failure closed the mine.
John Streicker provided the information at a technical briefing for reporters in Whitehorse Thursday. His announcement came only hours after the company issued its own statement saying it detected no cyanide in surface water after the slide.
Streicker says that elevated cyanide levels of about 40 parts per billion were collected in a creek, a level higher than the allowable five parts per billion, and which “could potentially affect fish.”
“Whether this concentration of cyanide in the water will actually affect fish depends on other chemicals in the water. Water quality sampling is ongoing and fish toxicity testing is underway,” he said.
He said the government had retained experts in aquatic science and water quality to help understand the risk to the aquatic environment.
When asked about the apparent disparity between the results, Streicker said samples were collected from multiple locations and testing would have to continue over an extended period.
“If you see a sample that says, ‘no you don’t have cyanide,’ that doesn’t mean that the risk is gone. This is a serious and significant slide,” he said.
“Over time, we will need to do a lot of monitoring to understand how, where, and when those potential contaminants are moving through either the surface or the groundwater and what that looks like.”
He says the First Nation of Nacho Nyak Dun, located 85 km south, was immediately informed after the results came in Wednesday night.
Chief Dawna Hope told APTN News in an interview on Wednesday she was “very worried” about cyanide and groundwater contamination. She said the First Nation would be moving swiftly if detected.
“We just want to make sure that things are done correctly moving forward to make sure that the utmost is done,” she said. “I recognize that sometimes mining entities, it’s a financial burden on them. But right now, it’s critical that we’re thinking about the environment and that is the bottom line. We want to be partners in that to ensure that we protect the lands and the waters and the wildlife for our people for generations.”
The First Nation said Wednesday it wanted all mining halted on its territory and an independent investigation into what happened at the site.
On Thursday, the Yukon NDP released a statement in support of the First Nation’s requests. However, Streciker was hesitant to speak on the issue directly, calling it “a big question.”
He said the government’s focus now is ensuring the mine site is safe and that it will continue to meet with the First Nation.
“All I’m saying at this point is we’ve heard it and we will consider it,” he said.
Victoria Gold, based in Vancouver, said surface water quality sampling at multiple points downstream of the mine located about 500 km north of Whitehorse had “not detected any cyanide” since the June 24 failure.
The failure occurred at a heap-leach facility, which uses a cyanide solution to percolate through crushed ore and extract gold.
Yukon government officials said at the briefing that ore spilled over an embankment at the base of the facility and the resulting landslide was about 1.5 kilometres long.
They said Victoria Gold had estimated the slide involved about four million tonnes of material and half of that escaped containment.
Yukon’s director of mineral resources, Kelly Constable, said the company moved quickly to build dams to hold back contaminated water that was released and pump it into storage ponds.
Mark Smith, a geotechnical engineer and heap-leach specialist with the government, said his preliminary estimate was that when the two million tonnes of material left containment, it included 300 million litres of cyanide solution.
Challenges of developing the mine
In a promotional video from the Prospectors & Developers Association of Canada, Victoria Gold CEO John McConnell said the mine was a challenging operation to get up and running.
He said Canada’s major banks wouldn’t finance the project and it was challenging to sell investors on a gold mine in the Arctic.
McConnell said in the end, the project was financed with non-traditional lenders and non-traditional equity holders.
“People were skeptical about heap leaching in Canada’s Arctic,” he said in the video. “There were a lot of people concerned that in an Arctic environment everything would freeze up.”
McConnell said when the pandemic hit, the company was worried the territory would put all mining on hold.
“We were at maximum debt,” he said. “The mining operation down would have been devastating.”
In its statement Thursday, Victoria Gold indicated it had received “notices of default” from its lenders under a 2020 credit agreement. According to a July 3 release, the company settled a class action worth $925,000 filed by investors.
“The investors’ claims arise out of alleged misrepresentations in Victoria Gold’s disclosure documents regarding mine operations, volume of production and costs of production of gold at Victoria Gold’s main operating asset, the Eagle Gold Mine,” said the Toronto law firm representing the plaintiffs.
The payment plan was approved by the Supreme Court of British Columbia on Wednesday. The claim is open to any investor who acquired “securities” between July 1, 2020 and November 12, 2020.
The defendants “do not admit any wrongdoing or liability on their part and the Court has not made any findings of wrongdoing or liability in respect of the Defendants,” according to the settlement.
The firm also announced it had received notices of default from its lenders related to a US$200-million credit agreement.
APTN reached out to McConnell for an interview but didn’t hear back before this article was published. If an interview is granted – or statement provided, it will be add to the story.
With files from The Canadian Press
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