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Cablegate: Uranium Mining in Atlantic Canada: Protests Versus Profit

VZCZCXRO4856
RR RUEHGA RUEHQU RUEHVC
DE RUEHHA #0036/01 1491159
ZNR UUUUU ZZH
R 281159Z MAY 08
FM AMCONSUL HALIFAX
TO RUEHC/SECSTATE WASHDC 1283
RUEHOT/AMEMBASSY OTTAWA 0529
INFO RUCNCAN/ALL CANADIAN POSTS COLLECTIVE
RHMFIUU/DEPT OF ENERGY WASHINGTON DC
RUEHHA/AMCONSUL HALIFAX 1371

UNCLAS SECTION 01 OF 03 HALIFAX 000036

SIPDIS

STATE FOR WHA/CAN AND EB/ESC/IEC
USDOE FOR IA (DEUTSCH)

E.O. 12958: N/A
TAGS: EMIN ENRG ETRD PGOV PHUM CA
SUBJECT: URANIUM MINING IN ATLANTIC CANADA: PROTESTS VERSUS PROFIT

REF: A. 07 OTTAWA 001201; B. HALIFAX 0013

HALIFAX 00000036 001.2 OF 003


-------
SUMMARY
-------

1. Considering there is a vociferous and devoted anti-uranium
lobby in Canada's Atlantic Provinces, it appears unlikely that
the region will be joining the world uranium club any time soon.
There are identified commercial quantities of uranium in three
of the four provinces that could be developed to meet growing
global demand for fuel for nuclear power plants. However,
mining companies have run up against government bans and hostile
citizen groups which could keep the uranium in the ground.
Although this is not the stated policy of any of the governments
involved, politicians are faced with weighing the cost of either
saying no to the anti-uranium forces or to the companies that
want to invest millions in their jurisdictions. END SUMMARY

--------------------------------------------- ---------------
OVERVIEW: URANIUM MINING (OR THE LACK OF) IN ATLANTIC CANADA
--------------------------------------------- ---------------

2. Skyrocketing prices and increasing global demand for clean
energy sources have sparked much interest in Atlantic Canada's
uranium deposits. Except for Prince Edward Island which has
only trace amounts of uranium, there are known commercial
quantities in the other Atlantic Provinces:
Newfoundland-Labrador, Nova Scotia and New Brunswick. The full
size of these deposits is still being determined, but several
companies are keen to start planning for development. At
present there is no mining underway in the region. If the
anti-uranium forces get their way, there never will be.

3. Environmentalists, conservationists and a slew of community
and farming groups in each of the provinces have mounted vocal
protest campaigns against mining companies and business leaders
who want to realize the economic potential from the resource.
Coming down in the middle in the debate are the respective
provincial governments and one newly-established aboriginal
government. So far the politicians have walked a fine line
between the two sides: acknowledging the concerns of the
anti-mining forces, while at the same time endorsing the
industry's assertions that modern technology has lessened the
potential environmental and health impacts of uranium mining.
While the debate shares these commonalities across the region,
the situation in each province is unique and has forced each
government to come up with its own strategy for dealing with the
issues.

--------------------------------------------- ---------------
NEWFOUNDLAND-LABRADOR - STYMIED BY A NEW REGIONAL GOVERNMENT
--------------------------------------------- ---------------

4. The Labrador region of the province holds the most promise
of any potential uranium development in Atlantic Canada. Since
2005 Aurora, a private company owned by Vancouver and St. John's
interests, has been exploring in what is known as the Central
Mineral Belt of Labrador, part of the newly designated Inuit
territory of Nunatsiavut. (Detailed information about the
location and Aurora's activities is available on the company's
web site www.aurora-energy.ca). In 2006 the company identified
a substantial amount of uranium at two locations on the Belt,
Michelin and Jacques Lake. The company followed up those
discoveries with another drilling program in 2007 which saw four
additional satellite deposits identified. Aurora estimates that
the combined deposits contain 133 million pounds of uranium,
making the area one of the largest deposits outside
Saskatchewan, the province where all of Canada's active uranium
mines are currently located (Ref A).

5. Aurora's original development plan called for the company to
begin the regulatory process by the end of 2007 with an expected
start-up date in 2014. However, after a spirited backlash from
the Inuit community, the company postponed filing its plan in
order to provide residents more information on how it would deal
with the problem of drilling waste. But before they could
provide the information, the issue ended up with the Members of
the Territorial Assembly, who were forced to act to stop a
growing rift between those wanting a ban on uranium activities
and those wanting to see the multi-million dollar economic
benefits accrue to the region from mining the ore. The Assembly
failed to resolve the issue. On April 8 the members voted eight
to seven in favor of implementing a three-year moratorium on
uranium mining in the territory, but in consideration of the
exploration activities already underway, the moratorium only
targets development, not exploration.

6. The Nunatsiavut government officials plan to use the

HALIFAX 00000036 002.2 OF 003


moratorium to develop expertise on how to evaluate the impact of
such a large scale project. According to our local contacts,
however, the Assembly could revisit the issue before the end of
the moratorium, especially given the narrow margin of the vote.
Aurora is pledging to work collaboratively with government and
community leaders on assessing the impact of a development
program, which could go a long way in addressing the concerns of
the anti-mining side. For its part, the Newfoundland-Labrador
provincial government is not getting involved in the issue other
than to endorse the Nunatsiavut assembly's right to enact the
ban under the terms of its establishment in 2005. They also
stress that the current federal and provincial regulatory
regimes (which would still apply to any development plan) are
stringent enough to ensure that any drilling project will get a
full environmental assessment.

--------------------------------------------- ------
NOVA SCOTIA - UNDER PRESSURE TO SCRAP A 25-YEAR BAN
--------------------------------------------- ------

7. The province of Nova Scotia has had a moratorium on uranium
exploration and mining since 1982, when a small but influential
protest group convinced the government of the day to stop a
company from mining in a location in central Nova Scotia.
Subsequently, world uranium prices slumped and the issue
remained dormant until 2005 when a new local company called
Tripple Uranium Resources (www.capellaresources.com) started
prospecting on acreage near the abandoned site. Despite having
the word "Uranium" in its name, the company (a subsidiary of
Vancouver-based Capella Resources) asserts that it is not
looking for uranium at all, but iron ore, copper and gold. In
fact, the company readily acknowledges that under the terms of
the 1982 ban, it will have to stop its exploration work if it
encounters any mineral deposits exceeding 100 parts per million
of uranium.

8. Coincident with the resurrected interest in uranium was the
revival of the anti-uranium protestors who are now asking the
question of what will happen to the ban if Tripple hits a large
amount of uranium. The protestors allege that Tripple is
already pressuring the provincial government to lift the ban in
anticipation of finding commercial quantities of uranium. The
government has made no secret that senior officials have met
with Tripple representatives, but as one of our senior
government contacts told us officials are always willing to meet
with any company interested in developing the province's mineral
resources. For now the government's policy is an expressed
desire that both sides engage in an informed debate on the
issue; however, an all-party committee of the provincial
legislature recommended that the government maintain the ban.
The committee recommendation reinforces the lobbyists' position
that the government should enshrine the ban in legislation.
Currently it is contained in a cabinet decision which mining
opponents assert could be easily be rescinded.

--------------------------------------------- ----------------
New Brunswick - Demands for a Ban in a Nuke-Friendly Province
--------------------------------------------- ----------------

9. Tripple Uranium is also one of the companies involved in
uranium exploration in New Brunswick, along with CVRD-Inco. The
two companies are in competing prospecting activities in
southern New Brunswick. Both are keeping the results of their
respective exploration programs secret for proprietary reasons,
but the anti-uranium forces in that province have already
started pushing the provincial government for a ban on further
exploration and future development. That appears unlikely given
the province already has signed exploration agreements with the
companies involved. Furthermore, New Brunswick has the region's
only nuclear power station and is actively considering building
another one (Ref B). Nonetheless, the government is attempting
to respond to the opposition forces by holding public
information sessions beginning in June. That announcement on May
8 did little to placate the lobbyists who have already condemned
the province for deciding to hold the sessions after various
exploration programs are already underway.

-----------------------------------
COMMENT - OH THE POLITICS OF IT ALL
-----------------------------------

10. In the end it will no doubt be politics, not exploration
results, which will determine the speed of development of the
region's uranium resources. As our senior Nova Scotia
government contact commented, there is a certain political
timidness in governments even talking about these issues, and
for good reason. Any government leader who comes down on the
wrong side of the issue could expect to pay a heavy political

HALIFAX 00000036 003.2 OF 003


price at the ballot box. On the other side, companies have
already invested millions of dollars in exploration work so far
and will want to do more than just look at prospecting results.
Also, the governments are cognizant of how barriers to uranium
development might be perceived in the mining industry as a
whole, given that there is growing demand for the region's other
minerals.

11. For the immediate future, areas to watch will be: how
Aurora fares in its consultative work with the Nunatsiavut
Assembly in Newfoundland-Labrador and if that will result in
another vote on a ban; whether there are any moves to make Nova
Scotia's ban permanent; and in New Brunswick, how the government
fares in its upcoming information sessions. As these events
unfold, they should shed some light on when Atlantic Canada
might be joining the world uranium club, if at all. END COMMENT
FOSTER

© Scoop Media

 
 
 
 
 
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