“There's gold in them thar hills!” So local prospectors and a Toronto-based company that have found a significant gold deposit outside of St. Stephen are saying. If the company determines that it makes economic sense to mine the gold and if necessary provincial and federal permits are obtained, a gold-mining operation could employ several hundred people in the area.
     The Clarence Stream gold project site is near Rollingdam, about 13 miles northeast of St. Stephen, and covers about 255 square miles, with Galway Metals drilling holes in the area and discovering new deposits.
     "There's a lot of gold there," says Michael Sutton, chief geologist for Galway Metals. "I think it's minable." He says the discovery "is really significant, if we can show it's economic to mine. It's the first big gold deposit in New Brunswick. It opens up the whole coastline."
     A year and a half ago, the company's estimate of the resource was 677,000 ounces, but since then the company has drilled at least 90 more holes with two new discoveries, including the George Murphy Zone. In a recent release, Galway Metals President Robert Hinchcliffe stated that "the discovery at George Murphy represented Galway's first drilling outside the three previously known deposits, and given the plethora of additional drill targets that exist, additional discoveries are likely ahead."
     Sutton says the company now believes there are at least a million ounces of gold at the site. With an ounce of gold worth nearly $1,400 U.S. dollars, the current value is about $1.4 billion. However, he cautions that it will not be economical to mine all of the gold, and an economic study of the resource will need to be carried out. Also, bulk sampling will need to be done to tell for sure how much gold is actually at the site.
     Noting that there are not many gold mines on the East Coast of the U.S. and Canada -- "the East Coast has a knock on it that you can't find gold" -- Sutton expects that companies will jump at the new opportunity. The three other recent gold discoveries on the East Coast are in South Carolina, where OceanaGold is now producing with an open-pit operation; Nova Scotia, where Atlantic Gold Corporation was recently taken over by St. Barbara Ltd. for $802 million (Canadian); and Newfoundland, where Marathon Gold Corporation has discovered a significant resource.
     As for what will happen with Galway Metals' interests in the Clarence Stream site, Sutton says that "if someone offers something fair for the shareholders, we will sell," or the company might mine the site itself. He notes that Galway Metals was spun out of Galway Resources, which had drilled for gold in Colombia and was sold to another company for $340 million (US).
Review process outlined
     As for the process moving forward, Sutton estimates it will take at least three years to conduct the environmental impact studies and to obtain the necessary permits from the province. Sutton notes that settling ponds are used for removal of toxic waste, with the last pond stocked with trout, which are used "as a bellwether" for determining water quality.
     According to Kelly Cormier, acting director of communications for the Department of Energy and Resource Development, all mining projects are subject to review under the Environmental Impact Assessment (EIA) Regulation of the Clean Environment Act. "This is a major project planning process led by the Department of Environment and Local Government involving many stakeholders, First Nations and the public," she states. "Depending on the situation, a federal government review may also be triggered. Approval will only be granted when all concerns over potential impacts have been satisfactorily addressed."
     The length of the review process depends on many factors, such as the scope of the planned operation, the requirement for baseline or background studies, the potential for contamination, possible disruption of fish habitat and the adequacy of consultation with the public and First Nations. The review period therefore may range from less than one year to several years, according to Cormier.
     A local prospector, David Stevens of Bocabec, notes that the permitting process, which he believes could take up to 10 years, also depends some on the political climate and how local people feel about the project. In the area around Clarence Stream, he says that "people seem positive about it," since it would be providing jobs.

Mine and mill operations
     Galway Metals is claiming 100% of the rights to the minerals, which are owned by the province. About half of the land is Crown-owned, with the other half owned by private individuals and J.D. Irving Ltd. If a mining operation proceeds, Galway Metals would either purchase the land or reach agreements with landowners to mine on the land.
     Payments to the province for any gold mined would be calculated as per the Metallic Minerals Tax Act, with the tax based on a percentage of the net revenue and the net profits.
     Any mining could be both open pit and underground. If Galway Metals does the mining, it would either need to build a mill or ship the gold to an existing mill. Sutton notes that the former Mount Pleasant mill, which is less than 10 miles from the site, possibly could be used. The Mount Pleasant site was mined for tungsten for less than two years, closing in 1985 when tungsten prices crashed. Stevens notes that about 200 people were employed at the mine and mill and says the operation ceased because a Chinese company obtained majority control and didn't want indium, which is at the Mount Pleasant mine, on the market, since China also produces indium. The Mount Pleasant location has the world's largest deposit of indium, which is used in computer screens, cell phones, cameras, transistors and other electronics.
     If a gold mining operation does proceed, Sutton says most gold mines employ about 300 people, with perhaps another 20 to 30 working at the mill.
     A local prospector, Reg Cox, had discovered gold at the Clarence Stream site around 2000. Sutton notes that the government does "a lot of the groundwork" for locating gold deposits, with stream sediment and bedrock sampling. Based on those maps, Cox went to the area and found an outcropping with gold on the surface. Although he has since passed away, Sutton says royalties will be paid to his family from any gold that is mined.
     "Prospectors are still really valuable," Sutton says, noting that two, George Murphy and Wayne Stewart, are currently working for Galway Metals.
     Sutton says that New Brunswick is "about 100 years behind Quebec," in terms of prospecting. However, he adds, "It's a pleasure working in New Brunswick. It's just awesome. The government helps as much as it can."