Cheetah Resources, the company overseeing the Nechalacho rare earths project southeast of Yellowknife, made another significant step toward production by signing a mining services contract with the Det’on Cho Nahanni Construction on Feb. 19.
The official signing of the $8-million contract stipulates that the construction company will provide mining and equipment services for a single extraction campaign between March and September under the direction of Cheetah.
Representatives of the miner, the construction company and economic development arm of the Yellowknives Dene First Nation (YKDFN) held the public signing at the new Cheetah Resources office at 4912–49 St. on Friday.
David Connelly, vice-president corporate affairs and strategy of Cheetah Resources Corp., made a brief statement ahead of the official signing.
“For Cheetah, Indigenous involvement is really important, not only in entry-level employment, but progressively more in senior-level employment and through procurements, such as this mining services contract,” Connelly said.
“To our knowledge, this is the first time in Canada that an Indigenous group is responsible for mineral extraction on their own territory. Geoff Atkins, managing director of Cheetah Resources, and the whole Cheetah Resources team, are really proud of that.
“There have been a few bumps getting here and we’ve had to work hard in the last few weeks to get it all done.”
Ndilo Chief Ernest Betsina of the Yellowknives Dene First Nation; Bobby Drygeese, chairperson of Det’on Cho Nahanni Construction; Sarah Kakfwi, office manager of Cheetah Resources Corp; Paul Gruner CEO and president of Deton Cho; and Kenny Ruptash, vice-president of Det’on Cho Nahanni Construction were all present for the event.
The company issued a news release on Friday to outline the significance of the mining contract to the project’s development. It includes work involving mining, site clearing, preparation of a retentions pond, site roads, a run-of-mine pad, and crushing and screening.
The event marked a little over a year since a memorandum of understanding was signed at the AME Roundup Conference in January 2020 which saw Cheetah selecting Det’on Cho as its preferred mining services contractor.
The construction company is expected to mobilize to the Nechalacho site via ice road by the end of March.
Geoff Atkins, managing director of Cheetah Resources, provided a statement emphasizing the significance of the signing.
“The signing of our mining contract in Yellowknife (on Feb. 19) was an important step forward for Vital (Metals) and our subsidiary Cheetah as we move toward production at Nechalacho,” Atkins stated. “We are pleased to be working with Det’on Cho Nahanni Construction Ltd., which is owned by local First Nations people.
“We are developing Nechalacho using the most sustainable methods possible and that includes the use of local labour so that we can further support the communities surrounding our project.”
Atkins said the agreement symbolizes another move closer to production after securing its first customer in Norway’s REEtec in December.
Drilling campaign underway
This year will see development of a small ore pit mine between March and September at a location on the Nechalacho site called the North T Zone – a near-surface, high-grade rare earth deposit in the northern edges of Thor Lake, southeast of Yellowknife.
The contract will have Det’on Cho Nahanni Construction doing the mining and crushing over the six months under the management of Cheetah.
During the summer months between 2021 and 2023, Cheetah personnel will be involved in separating the ore for shipment to Saskatchewan for processing.
Last September, Cheetah signed an agreement with the Saskatchewan Research Council to process rare earths concentrate in a new $5.25-million rare earth extraction plant being built in Saskatchewan.
Friday’s news release states that after the first Nechalacho mining project, it’s anticipated that a second mining campaign in 2024 will be required for continuing operations.
Cheetah has started a 30-hole drilling program at the Nechalacho site to define a preliminary mine plan for a second phase of production in the nearby Tardiff deposit.