PROFILE (November 18, 1991)

Discouraged by Maine’s cumbersome permitting processes, mining companies have shunned the state for more than a decade. On July 31 when Maine replaced the various sets of regulations with a single legislation, TSE-listed Black Hawk Mining immediately filed a baseline monitory plan for its 100% owned Knox nickel-copper-cobalt project, 2.5 miles south of the village of Union and 30 miles east of Augusta.

In September, Black Hawk received official response to its plan and, according to Chairman Gordon Bub, it will take 12 months and cost $1 million to complete the requirements as specified. The study will include wildlife habitats, soil types, vegetation, fish tissues, geology, surface water and groundwater. The company will use the data as part of the basis for its environment impact report.

“With reference to the estimated capital (US$40 million) and operating costs (US$23 per ton) given by Fluor Daniel Wright for mining and milling and our own estimates for other cost items, we believe the project is feasible at current nickel price — US$3.50 per lb.,” says Bub. “Most new projects need US$4-4.50.”

As it takes at least 18 months to get the necessary permits and a year to build the plant, Bub thinks Knox will start producing in 1994 and predicts the price of nickel will have reached US$6-7 a lb. by then.

Three years ago, Black Hawk decided to specialize in nickel because it is the only metal that producers cut back production when the price becomes soft, says Bub.

“The four major producers in the Western world, Inco Ltd., Falconbridge Ltd., SLN of France and Western Mining of Australia account for 80% of western production and they tend to act in unison.”

Black Hawk’s other 100% owned nickel project, Minago in Manitoba, was purchased in 1989.

Born in Regina, Sask., in 1942, Bub grew up in Toronto. As a student at Queen’s University, he had a summer job with Falconbridge at its now-closed East nickel mine in Sudbury, Ont. In 1965 he graduated with a B.Sc. degree in mining engineering and then took M.B.A. courses at the University of British Columbia.

From 1966 to 1987, he worked for different brokerage firms including Burns Bros. and Denton Ltd. (now Burns Fry) before he became a merchant banker at Dundee Capital. In 1987 he joined DCC Equities, which bought control of Black Hawk in 1988.

Bub is an avid scuba diver. He and his wife, Roberta, have two children. Bub expects the economy to start picking up shortly. “Small companies can raise money soon but a high percentage of the exploration money will be spent outside Canada,” he says. Black Hawk, for one, has looked at three nickel projects in Africa.