Det'on Cho signs agreement to run operations at N.W.T. rare earths mine

In what could be a Canadian first, an N.W.T. first nation has signed an agreement to run mining operations on a project in their own traditional territory.

Det'on Cho Nahanni Construction Corporation, owned by the Yellowknives Dene First Nation, will run operations on the Nechalacho rare earth mineral project between the Dene communities of Dettah and Lutselk'e. It was announced at the Annual Mineral Exploration Roundup mining conference this week in Vancouver.

Yellowknives Dene Chief Ernest Betsina said the signing marks a transition from the first nation being "passive witnesses to major projects to being key participants."

Cheetah Resources' Nechalacho project is moving toward small-scale production of rare earths like neodymium-praseodymium, which can be used in wind turbines. 

Mining is slated to begin this year at the project, subject to approval at the Mackenzie Valley Land and Water Board. 

Det'on Cho competed for the project, which will create roughly 20 and 25 jobs with six months of employment each year for three years, according to president and CEO Paul Gruner. 

Asked how many jobs will directly benefit members of the first nation, Gruner said it will be a "best effort" and that the company is already seeking out potential candidates.

At the low end, 50 per cent of hires will be Indigenous, but it's more likely to be 75 per cent, said Gruner.

The quarry operation needs drill blasters and equipment operators for a crusher. A plant separates waste from rare earths, which are then loaded on to a barge for processing in southern Canada.

The project will also have a shoulder season for winter road construction, providing access to the site. 

Gruner said Det'on Cho's involvement is an opportunity to increase worker capacity to get into larger scale opportunities in the future.

Yellowknives Dene chiefs signed a letter to the Mackenzie Valley Land and Water Board supporting the project.

Cheetah Resources adviser David Connelly said in an email that the agreement could be "the first time in the N.W.T. and Canada that all mining operations will be contracted to an Indigenous firm, enabling them to be a miner on their own lands."

A recent agreement between Canada and the U.S. to reduce their dependence on Chinese-sourced rare earths, factored into Cheetah's investments in the Northwest Territories, said Connelly. 

FN could look to make similar agreements in future: CEO

Jason Snaggs, the Chief Executive Officer for the Yellowknives Dene, said there is a desire to achieve similar agreements with other development operations. If there is high enough mineral potential at Nechalacho, the first nation is poised to have an economic role in an expanded mine.

The small-scale projects are about finding customers for a rare earth project. Once the material is mined and processed, it would likely be sold to companies like Australia-based Lynas or to Europe and Japan, said Geoff Atkins, managing director of Cheetah Resources Corp.

The material could be used in electric vehicles and high strength magnets, said Atkins. 

The company will start moving equipment on an ice road in February. The project awaits regulatory approval, but the company is confident enough to start moving equipment, said Atkins.

N.W.T. industry minister Katrina Nokleby applauded the agreement.

"I'm really glad to see that we're moving away from Indigenous involvement being cutting a cheque for the use of someone's name to actual ownership and partnership," said Nokleby.