July 17, 2006

Minister refers Alcan, Wuskwatim projects, requires comprehensive study for Galore Creek mine proposal

Federal Environment Minister Rona Ambrose has referred Alcan's proposed spent pot lining project back to Industry Canada, the responsible federal authority, for appropriate action, having concluded that the project is unlikely to cause significant adverse environmental effects.

Her decision was based on the findings, conclusions and recommendations contained in a comprehensive study report submitted by Industry Canada, along with public comments received during a 24-day consultation period and the department's response. The Minister concluded that the mitigation measures and follow-up program described in the comprehensive study report are appropriate for the proposed project.

Ambrose has further recommended that Industry Canada, as the responsible authority, ensure that the mitigation measures described in the report are put in place and that the department carry out the follow-up program (also described in the report). This will help determine the effectiveness of the measures taken to minimize any adverse environmental effects and will verify the accuracy of the project environmental assessment (EA).

The proposed project is intended to demonstrate the effectiveness of "Low Concentration Caustic Leaching and Liming," a chemical process developed by the proponent, Alcan Primary Metal Group. The process converts spent pot lining, a byproduct of aluminum production, into non-hazardous waste and recyclable materials.

Industry Canada is the responsible federal authority by virtue of the fact that Alcan has sought funding from the department to support the construction and operation of a pilot plant in JonquiËre, Quebec. The plant would have a processing capacity of up to 80,000 tonnes per year of spent pot lining, brought from Alcan's stockpiles in Québec, as well as from sources around the world.

Alcan's proposed project was the subject of a provincial EA by Quebec's Office of Public Hearings on the Environment (BAPE), which concluded that the project would have a marginal impact on the environment.

Ambrose has also referred the proposed Wuskwatim hydro generation project in northern Manitoba back to the two responsible federal authorities, Fisheries and Oceans Canada (DFO) and Transport Canada (TC), for appropriate action, after concluding that the project does not require further assessment by a review panel or mediator under the Canadian Environmental Assessment Act.

As with the Alcan project, the Minister's decision was based on the comprehensive study report by DFO and TC, with the conclusions and recommendations, input during the public consultation and the response from the responsible authorities, and implementation of all mitigation measures and the follow-up program.

The development, proposed by Manitoba Hydro in partnership with the Nisichawayasihk Cree Nation (NCN), includes a 200-megawatt generating station, plus construction of transmission facilities to deliver power to the Manitoba Hydro system, a camp to house workers, an access road. It is expected to take about six years to build the $1.1-billion facility, to be located on the Burntwood River, about 45 km southwest of Thompson and 35 km southeast of the NCN community of Nelson House.

The Minister's EA decision statements for both these projects may be viewed on the Canadian Environmental Assessment Agency Web site, www.ceaa-acee.gc.ca.

As a result of the Wuskwatim project decision, the Manitoba government has issued two licences for its construction. Conservation Minister Stan Struthers said the move also follows from the NCN's recent endorsement of the project, as well as a recommendation that the licences be granted, made by the province's Clean Environment Commission in October 2004. The Commission's report recommended that an environmental licence for the project be granted, subject to a number of hydrological requirements and environmental protection plan requirements.

In accordance with the requirements of Manitoba's Environment Act, the province has approved:

*a generating station licence for the Wuskwatim Power Limited Partnership permitting the construction, operation and maintenance of the Wuskwatim generating station and related dams, dikes, channels, control structures and infrastructure, including roads; and

*a transmission project licence for Manitoba Hydro permitting the construction, operation and maintenance of the Wuskwatim transmission project consisting of three transmission line segments, new transmission station developments at Wuskwatim and Birchtree near Thompson and modifications to the existing Herblet Lake and Rall's Island transmission stations at Snow Lake and The Pas.

A third water power licence by Manitoba Water Stewardship is expected to be approved shortly. The water power licence would allow the Wuskwatim Power Limited Partnership to use water to operate the Wuskwatim generating station within regulated flows and levels.

In a third major project decision, federal Minister Ambrose has called for a comprehensive study as the most appropriate type of EA for the proposed Galore Creek Copper-Gold-Silver Mine Project in British Columbia. This decision was based on a scoping report and recommendation submitted by Natural Resources Canada (NRCan) on behalf of the responsible authorities (DFO and TC, as well as NRCan).

In addition to being subject to a comprehensive study EA under the Canadian Environmental Assessment Act, the project also requires an EA certificate under BC's Environmental Assessment Act. Accordingly, a co-operative EA is being carried out under the Canada-BC Agreement on Environmental Assessment Co-operation.

NovaGold Resources is proposing to construct and operate an open-pit mine, approximately 350 km northwest of Terrace, to extract copper, gold and silver. The proposed project would include an access road, ore concentrate slurry pipeline, transmission line, processing plant, airstrip, waste rock storage and supporting infrastructure.

At the same time, the Canadian Environmental Assessment Agency has awarded $30,000 through its participant funding program to the Iskut Band Council to help it take part in the Galore Creek project EA. The funding will support the Council's involvement in the comprehensive study process and/or the review of the comprehensive study report on the project, once the document has been submitted by the responsible authorities.

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