The Key Lake Project Table of Contents
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ca91109ll L. INlS-mf —12933 THE KEY LAKE PROJECT TABLE OF CONTENTS Page Summary 1 Project Overview 3 Work Force 5 Mining 6 Mill Process 10 Tailings Storage 21 Permanent Camp 24 Environmental Features 25 Worker Health and Safety 2 7 Economic Benefits 29 Appendix 1: Historical Background 30 Appendix 2: Summary of Construction Projects 32 Appendix 3: Comparison of Western World Uranium 33 Mines Appendix 4: Mining Statistics 34 Appendix 5: Northern Saskatchewan Surface Lease 37 Overview Appendix 6: Key Lake Development and the Regulatory 42 Agencies SUMMARY LOCATION: Key Lake is located in the Athabasca sandstone basin. 640 kilometers (400 miles) north of Saskatoon, Saskatchewan in western Canada OWNERSHIP: The project is owned by Saskatchewan Mining Development Corporation (SMDC), 50%; Uranerz Exploration and Mining Limited, 33 1/3%; and Eldor Resources Limited. 16 2/3%. SMDC is a commercial corporation owned by the Government of Saskatchewan, Ucanerz a wholly- owned subsidiary of Uranerzbergbau Cmbh. of Germany and Eldor, a wholly-owned subsidiary of Eldorado Nuclear Limited, a commercial corporation owned by the Government of Canada. The history of the ownership of the project is quite complex. Its early beginnings go back to 1968 when Uranerz Exploration and Mining Limited, joined with Inexco Mining Ltd. and seven other companies to form a joint venture to explore the Athabasca sandstone region of northern Saskatchewan. By 1970, when the market price of uranium was about $6 a pound, six companies dropped out, leaving Uranerz, Bell oil and Inexco. all with equal shares. By 1974, discouraging results led Bell Oil Co. to decide to leave the joint venture. The other t;-;o partners (Uranerz and Inexco) offered Bell's one-third share to the Saskatchewan government who established SMDC to act as its agent. In 1978, Inexco decided to sell its 1/3 share to SMDC which sold one-half of this share to Eldor Resources Limited. Thus the partnership came to be the present arrangement of SMDC: one-half; Uranerz: one-third; Eldor; one-sixth. OPERATOR: Key Lake Mining Corporation (KLMC). wholly owned by the joint venture partners, is the operator of the project. OREBODY STATISTICS: The three sources of ore at Key Lake contain 70,100 tonnes U or 182,400,000 pounds U,0o, J o consisting of the following: CO o o o O O o o o o 2a m o o o o D o o o o W o o o o rH in CO E CJ D a 8 o O o o CO o o o o r~ c C CM 0 (Nl EH o n m w Q CTl IN o o o o o o o o o o o o 01 13 o o o o C o o o o u o o o o Po o r~ in (N en us o r* PI r- 1 r-l 'S r-H o O o o in o o o o 0) o o o o c hi c 'J* r- r~ CO o H H CO rH EH CO rH m in O W 8 EH PROJECT OVERVIEW The Key Lake uranium deposits in northern Saskatchewan are high in grade and near the surface. The first deposit was discovered in 1975. Uranerz Exploration and Mining Limited, the operator in a joint venture exploration project, struck high-grade uranium ore in a diamond drill hole near Key Lake. Subsequent drilling outlined the Gaertner orebody. Continued diamond drilling in the Key Lake region resulted in the discovery, about one year later, of a second discrete high-grade uranium deposit, the Deilmann orebody. Development of the project proceeded to the stage where an Environmental Impact Statement was prepared and filed with the Saskatchewan Department of the Environment in late 1979. The Key Lake Boad of Inquiry was commissioned in December, 1979 and completed public hearings on the site-specific environmental and socio-economic aspects of the project by the end of 1980. In February, 1981 the Board recommended that the project proceed, subject to conditions which would protect employees and the environment and increase the benefits to residents of northern Saskatchewan. The provincial government accepted the Board's report and subsequently signed a surface lease agreement with KLMC on August 27, 1981 covering a 21-year period. For a brief historical background see Appendix 1. On site construction began immediately under the supervision of the engineering, procurement, construction and management consultant. Wright Commonwealth Joint Venture. For a more detailed summary see Appendix 2. Ore is extracted by open pit mining methods with separate pit development for each deposit. The mill is designed to process 700 tonnes (780 tons) of ore per day and employs conventional separation and extraction techniques to process the high-grade ore. Overall uranium recovery will be greater than 97% and annual production capacity will be 5.440 tonnes U O (12 million pounds U O ). 3 8 3 8 Although the maximum output capacity is among the largest by world standards, the design of the mill and the high grade of the ore permit efficient production at lower levels. This provides flexibility for the operator to respond to market conditions and customer requirements. For comparison to other uranium mines see Appendix 3. Access to Key Lake is by air and road. A gravel airstrip has been constructed and an all-weather road to the mine site has been completed. THE WORK FORCE The Key Lake project employs 450 people. Following a study of employee turnover at similarly remote mines and taking into consideration the social fabric of the native people working at the project, it was decided not to establish a townsite at Key Lake. Instead, a 7-day in, 7-day out commuter system is in effect. Under this system, employees are flown from six northern designated pickup points (La Ronge, Pinehouse, lie a la Crosse, Buffalo Narrows, Cumberland House and Pelican Narrows) to the mine, where they work an 11-hour shift each day for seven days. They then return home for a seven-day period, while their replacements are working at the project site. Thus at any one time only half the work force is on site. This work schedule has proven successful in other uranium operations in northern Saskatchewan. It avoids social problems that. frequently arise in small, remote development-based communities. Since northerners comprise a substantial part of the Key Lake work force, this schedule should be less disruptive to their community lifestyle. For those who are accustomed to making their living by trapping and fishing, the routine of being away from home several days at a time is not new. MINING KARL ERNST LAKE COBBLE ORE BASEMENT ROCK GRAPHITE GNEISS »SANDSTONO A MHOT E PIT FLOOR / p i ca 1 — Cross Section ofGacriner Deposit (Looking Northeast) Overburden The Gaertner pit is estimated to contain approximately 7.7 million cubic metres of overburden material (sand and till), varying in depth from 20 to 60 metres. Scrapers first, then shovels and trucks began removing overburdern from an area approximately one-third the ultimate surface area of the pit. The material has been transported to the waste storage area. Removal of overburden covering the Deilmann orebody will begin at a suitable time to provide continuity of flow of ore to the mill. The overburden from the Deilmann area is estimated to amount to 21 million cubic metres, almost three times the volume covering the Gaertner orebody. Removal of this material will generally follow the procedures used in developing the Gaertner pit. Grour.-awat.er The terrain in the Key Lake area, composed largely of glacial sand and till, results in ground water levels that are close to the land surface. Precipitation tends to seep into this glacial material, in part because of the porous nature of sand and in part because of the scarcity of vegetative ground cover owing to poor soil conditions. Therefore, it was necessary to lower the ground water level while the overburdern is being removed and throughout the period of mining, keeping the ground water level below the bottom of the pit. KLMC sank a series of wells around the perimeter of the Gaertner pit so that ground water could be pumped from the production areas into the natural water drainage system leading to the Wheeler River. The mining of ore at Key Lake began in May, 1983 and will continue until at least the year 2000. Standard open pit mining techniques are employed. Rock containing the ore is broken using a 8 bulldozer and, when required, by conventional drilling and blasting. The ore is loaded onto trucks and transported to the primary crusher, which reduces it to a small, fairly uniform size. The crushed ore is transported to the stockpile area, where it is blended in order to achieve a uniformly graded material for metallurical processing. Most mining activities will be worked two shifts a day. seven days a week. 12 months a year. The ore zone, however, will probably be worked one shift a day, seven days a week. 10-12 months a year. Once the Key Lake orebodies have been mined out, natural ground water levels will be restored in the area. The dump areas used to store the overburden will have an average height of approximately 20 metres above general topography, similar to the existing undulating terrain in the immediate vicinity. For further information and statistics see Appendix 4. a. O X (/) LU LU I THE MINE SHOPS FACILITY HOUSES THE FOLLOWING: - Mine mobile equipment repair shops and washdown facilities (Decontamination Bay) i - Lube Bay - area where oil changes and lubrications are done i - Repair Bays - areas where the main repair work is done - Machine Shop - area where the lathes, milling machines, etc.