Mining Revitalized in Northeast BC ? Part II of III:

Western Canadian Coal Corp. (WCC) originally filed its Application Report (AR) to the BC Environmental Assessment Office (EAO) on January 10, 2002. But as project work and feasibility assessments advanced over 2002, WCC revised its mine designs, management plans, and permitting approaches. This change of plans required the EAO to request a Revised Project Description (RPD) from WCC which highlights changes between the ?original? and the ?revised? projects. WCC filed its RPD on October 10, 2003, which included proposals for further studies needed to fulfill the EAO?s requirements. WCC plans to file its Supplementary Information Report (SIR) by April 1, 2004. The timeline for the review process of a mine application is 255 days, or eight and a half months. If WCC files its SIR by April 1st, the company should have its approvals in place by the end of November 2004.

Fast Facts

WCC owns three properties in northeast BC: the Wolverine, Brazion, and Belcourt. The Wolverine property is comprised of three main coal deposits: the Perry Creek, Mt. Spieker/EB, and Hermann. WCC proposes to develop the Perry Creek deposit first and defer development of the Mt. Spieker/EB deposit until the seventh year of its mine plan. The original mine plan was predominantly an underground operation with a small open pit. The revised mine plan is predominantly a large open pit operation with a small underground mine. Based on an expected production rate of 1.6 million tonnes of hard coking coal per year and a mine life of eight years, there are approximately 17.1 million tonnes of known coal reserves in the Perry Creek deposit. Perry Creek will be an eight year open pit operation and the Mt. Spieker/EB will be a three year underground mine operation, making the total life of the Wolverine mine approximately 11 years. WCC will submit a separate AR to the EAO for the Mt. Spieker/EB deposit when it is ready to develop that portion of the mine. The Wolverine mine will be located between the old Quintette and Bullmoose coal mines in the Wolverine and Perry Creek watersheds, approximately 25 km west of Tumbler Ridge.

Based on WCC?s RPD, the Wolverine Project will include the Perry Creek and EB open pits with related dumps and access roads, a coal processing plant and related coal handling facilities, equipment maintenance and administration facilities, and an explosives storage facility. The Wolverine mine will be favourably located to required infrastructure although ancillary facilities include upgrading to an existing 2.5 km rail siding on the BC Rail Tumbler Ridge spur line, and construction of a new 25 kV power line between the BC Hydro Tumbler substation and the Plantsite, largely along existing rights of way. The existing Wolverine Forest Service Road (FSR) will be used to access the Perry Creek mine and the EB Pit will be accessed from the existing Perry Creek Road, which is not an FSR.

Status Update

Following submission, screening and acceptance for review by the EAO of its SIR, WCC will be required to conduct a new round of public consultations with local communities, stakeholders, and First Nations. If the review process goes according to the timeline, WCC expects to receive its Environmental Assessment Certificate from the EAO and its Mine and Reclamation Permit from the Ministry of Energy and Mines by November 2004. ?WCC could be challenged to meet its target date of November 2004 considering that from the time the SIR is accepted, there is a maximum of 180 days until the EAO makes recommendations to the Ministers who have up to 45 days to make a decision,? said Bob Hart, EAO?s Project Assessment Manager for WCC?s Wolverine mine application. The review process may be quite involved and delays in submissions of mine applications are common, making it very likely WCC?s expected construction start date of November 2004 and an anticipated production start date for the second quarter of 2006, to be bumped up yet again.

The initial capital cost for the Perry Creek Pit is expected to be $116 million with an additional $6 million required for the EB Pit in the fifth and sixth years of the life of the mine. WCC plans to market its coal to the Japanese steel industry with projected gross revenues from sales expected to be $100 million per year.

Benefits to Tumbler Ridge

The Perry Creek mine will contribute to the economic base of the region and the town of Tumbler Ridge by providing employment opportunities from entry level jobs to skilled tradespersons and professionals. A contract operator will be hired to operate the mine and plans are for the contract operator to hire the majority of the required workforce from Tumbler Ridge and the region, including First Nations. Approximately 200 people are expected to be hired; 140 to 150 hourly employees and 40 to 45 staff.

The results of WCC?s socio-economic impact study, which was submitted with its original AR, contains information that is now outdated. The most dramatic changes in information are the fast-dwindling workforce of skilled miners, the loss of supporting businesses that closed after the demise of the Quintette and Bullmoose mines, and the change in ownership of the housing in Tumbler Ridge which is no longer owned and cheaply rented by the previous mine companies. All three of these changes could have a negative impact on WCC?s plans of hiring and housing its workforce in Tumbler Ridge, or awarding contracts to local businesses that no longer exist in the area.

Depending on government approvals, successful negotiations with stakeholders, and obtaining the required financing to start construction, only then will WCC be able to proceed with its Perry Creek mine.

** Part III of this series will take a look at Northern Energy & Mining Inc.?s Fast Facts, Status Update, and Benefits to Tumbler Ridge.