213 Eldor Mines Ltd

In 1982, Eldorado Nuclear bought out all the properties of Gulf Minerals Canada, the Gulf Oil subsidiary, together with those of Uranerz Canada. It then renamed Gulf Minerals Eldorado Resources (Eldorado Nuclear technically remaining the name of the parent company) (1). Gulf and Uranerz's Rabbit Lake uranium mines were put under the control of Eldor Mines, while control over Eldorado's Key Lake investments was assumed by Eldor Resources (1).

Until Gulf Oil, the defunct Gulf Minerals Canada's erstwhile parent, was itself taken over by Socal/Chevron in 1984, the Rabbit Lake operations (51% management control by Gulf Minerals) provided them with the majority of their yellowcake supplies, making Gulf Oil the western world's 6th largest producer of uranium oxide (2548 tons) by 1982 (2). In 1983 and 1984 production levelled at about 3.5 million pounds U3O8 (3). The previous year, the mine passed its "half life point" and Gulf Minerals announced it would offset its "pending exhaustion" with ore from the new Collins Bay "B" deposit (4).

Rabbit Lake

The Rabbit Lake orebody along the Wollaston Lake Fold Belt was originally discovered by the company in 1968. An early, unconfirmed, report put the grading as high as 8% uranium metal with some portions of the orebody running to no less than 65% uranium metal (5, 6). Similar reports reckoned that the new mine could boost Gulfs total reserves to more than 100,000 tons U3O8 (6). But despite some later discoveries of uranium in the area - Gulf in the late '70s held around 240,000 acres under claim (7) - the initial optimism was soon tempered. Reserves at Rabbit Lake by 1978 were put at a fifth of this (42 million pounds U3O8) (7) and, soon after the mine started production in 1975 at 60% of its design capacity of 4.5 million pounds U308 per year, problems began appearing.

Due to erratic mineralisation, the mill feed had to be blended (8) and a limit set on its grade of 0.6% (7). Thanks to sub-arctic temperatures (down to minus fifty for some weeks in the winter) Gulf developed (initiated?) the "labour fly-in" system, keeping the operation going around the clock by drawing the workforce from communities (including indigenous ones) within a 640km radius (8) and keeping half the employees on site at any one time (130 out of a total of 265 in 1978) (9). This arrangement clearly took a physical and emotional toll on the employees, and there were "difficulties faced by some of the wives in running their homes during their husbands' absences," as the Mining Journal put it at the time (9). Moreover, the company violated rules of the Canadian Labor Congress in gaining a 77-hour working week for its non-union workforce. But Gulf reported a "remarkable success in stabilising the workforce - turnover is down to an average 12%" (9), and the high returns clearly satisfied both labour and management.

The Rabbit Lake orebody was mined out in August 1984, several years earlier than expected. Gulf Minerals then started preparing the open pit as a "disposal facility" for tailings from the new Collins "B" deposit, 9km northeast. This would take both feed from stockpiled Rabbit Lake ore until 1986 (the intended startup date of Collins "B") and use a modified Rabbit Lake mill (10).

The Rabbit Lake tailings had already been dumped in Wollaston Lake since the start-up of operations in 1975 (11), and the local community, indigenous and non-native, had protested about the fact for ten years (12).

In 1976, residents in the Fond du Lac and Black Lake communities, downstream from Rabbit Lake - which include many native people - cited unacceptably high radiation levels in the area. A Federal Radiation Protection Bureau study discovered radon and radon "daughters" ranging from 0.001 to 0.016 working levels, emissions found unacceptably high" by nuclear expert Dr Fred Knelman of Montreal's Concordia University (13). When no further checks were made on dangers to the communities between July 1976 and March 1980, local teachers went on strike (13). In mid-1985, a blockade organised by the Collins Bay Action Group (CBAG) and the Lac La Hache native band council took place at the entrance to the Rabbit Lake and Collins Bay mines as part of a broadly supported Northern Survival Gathering (see Eldor Resources).

It is not clear how far Gulf Minerals' contracts have been fulfilled from Rabbit Lake, and the extent to which they will be met from Collins "B": by 1978 the company was committed to supplying nearly 20 million pounds U3O8 to European utilities (notably in Spain, Belgium, Switzerland, Finland and West Germany), the USA and Canada itself (7).

In any event, the Rabbit Lake production became crucial to its parent company soon after the mine was opened, when Gulf Oil began fulfilling contracts to three utilities after the United Nuclear Corporation (UNC) halted deliveries, thanks to Gulfs being cited as a member of the notorious uranium cartel (14).

Other information about Gulf Oil's participation in the cartel is to be found under General Atomic in this File. What is important here, is to briefly outline the relationship between Gulf Canada and its parent when, very shortly after the cartel was set up in 1972, senior executives of Gulf Minerals Canada learned of the incipient conspiracy to control the western world's uranium market. Although the French CEA and the South African, French and Canadian governments (as well as RTZ) had initially agreed to exclude both Australian companies and Gulf Oil from the uranium club, the latter forced their way in (15).

A Gulf internal memorandum later described the original cartel members as "... playing a game in which they hope to a) keep Gulf as the "new boy on the block" away from the poker table and b) block the Australians from starting production" (16). It is difficult to assess the degree to which Gulf Minerals Canada itself wished to participate in the street-corner gang. When a US executive of Gulf Minerals was asked by the congressional sub-committee, "How does all this square with your personal moral code?" he agreed that it posed a "problem of conscience" (17).

In any event, the Canadian subsidiary company felt it had to cover its involvement. Canadian federal government officials, faced with Gulf Minerals' hesitation, invited Gulf's own lawyers to draft a letter on Canadian government notepaper ordering the company to join the cartel (18).

Three years later, after Westinghouse and TVA sued Gulf Oil in the US District Court of Illinois for non-delivery of uranium, the parent company was able to argue that its Canadian subsidiaries acted "under compulsion": if they participated in the cartel, it was "in compliance with Canadian demands" (19). However, in 1976 the Canadian government passed a "gag law" preventing the removal from Canada of documents relating to the cartel (and Canadian government complicity in it). Gulf Oil was therefore in a situation of agreeing with US courts that it had participated in a cartel, claiming its Canadian subsidiaries had been "ordered" to participate, demanding the release of a fake memorandum drafted by the company's own lawyers on official Canadian government notepaper, and being strenuously opposed by "the very people who had arranged for Gulf to draft the fake documents in the first place - the Canadian Liberal Cabinet". It was indeed a "moment of supreme irony" (18).

The Canadian Supreme Court, not surprisingly, backed the federal Canadian government; the US courts found Gulf Oil guilty of a misdemeanour and fined the company US$40,000 (17). In 1982 WPPS (Washington Public Power System) also sued Gulf Minerals Canada for failing to deliver uranium (20). By 1984, the company had paid out US$70M in settlement of suits brought by US utilities (21). Then, in late 1983, the Canadian government itself dropped charges against Gulf Canada (along with Denison, Rio Algom and Uranerz) for its participation in the cartel, brought under the Combines Investigation Act (10). The federal government decided it could not proceed against privately owned corporations when state owned companies similarly charged (notably Eldorado) were not being prosecuted since they were "above the law" (22).

While embroiled with the courts, Gulf Canada was facing opposition from farmers in the Newboyne area of eastern Ontario after a 1978 aerial survey revealed uranium mineralisation there. Without any reference to the local people, Gulf moved in, signed contracts with a number of farmers and took drilling rights on one of twelve prospects (23). Soon after, other members of the community, led by Kathryn and Marcellus White, mobilised against further exploitation and forced Gulf to withdraw. The company claimed they were abandoning the project because "there was no ore to mine". The explanation fooled no-one. "The action taken by the citizens of Leeds County serves as an example to people in other parts of the province in showing that a united front against a multinational giant like Gulf can yield results quickly" (24).

In early 1988, Eldorado was given permission to develop an underground mine at Rabbit Lake (with a minimum of 70,300 tonnes uranium) (25). Later the same year, Eldor mines received full environmental approval from the Saskatchewan government to develop both the Collins "A" and "D" deposits, and additional large reserves at Eagle Point. These were then the only environmental approvals to be granted for uranium production into the twenty first century (26). Earlier the same year, however, the Federal and Saskatchewan governments announced a merger between Eldorado Nuclear and SMDC, with their subsequent complete privatisation. Initially, the Canada Development Investment Corporation would own 38.5% and the Saskatchewan Government 61.5% of shares in the new corporation (reflecting the relative viability of the two companies). Foreign ownership in Canadian uranium companies was also eased, to allow for overseas holdings of up to 49% (27).

It was envisaged that 30% of the new company would be in private hands by 1990, 60 per cent two years later and the full amount by 1996 (28).

This means that the new company, Cameco, now has responsibility for Rabbit Lake, the Collins Bay deposits, Eagle Point, Cigar Lake, and various gold exploration projects (29) as well as base metal and industrial metal exploration (30). Although the world's biggest producer of uranium, Cameco's privatisation was delayed in 1989/90 due to weak market conditions (31).

The Rabbit Lake mill was also closed for six months during the latter part of 1989 because of the slide in the uranium price (32). Planned expansion of capacity in the area to 12 million pounds/year was held up (33), although upgrading of the mill and initial development of the Eagle Star South deposit were initiated in that period (31). The following year, the company agreed to sell a one-third stake in Rabbit Lake - with its mill, the three Collins Bay orebodies, Eagle South and surrounding claims - to Uranerz, which already owned 33.33% interest in Eagle Point North deposit (31, 34).

Cameco's estimate for future output from the Rabbit Lake mill is 5450 tonnes of U308 per year (35).

In November 1989, around two million litres of radioactive and heavy metal (radium, arsenic and nickel) -bearing fluids burst into Collins creek, which itself flows into Wollaston Lake. The seepage occurred from a faulty valve on a 10 km long pipeline carrying runoff and seepage from the Collins Bay mine: loss of pressure in the pipe was recorded by monitoring equipment but not noticed until fourteen hours (sic) after the rupture (36). Although the company was said to have acted quickly to bulldoze soil around the spillway (37), public outrage was intense.

In particular, concern was expressed that drinking water and the whitefish spawning grounds in the creek and Wollaston Lake would be gravely affected by the contamination (36).

Wollaston Mayor, Emil Hansen, and Chief Edward Benonie, representing the 800 Indian community members of Wollaston Lake, called for an independent inquiry into the mining industry in northern Saskatchewan and the spill in particular. "The whole economy of the region depends on that lake" he declared. "We know the environment has changed since that mine came. Time will tell how much." Benonie also asked who would buy whitefish now that the calamity was common knowledge. Calls for a federal inquiry were echoed by Saskatchewan MP for the Prince Albert-Churchill River region, Ray Funk, who called the incident a "total breakdown of the nuclear regulatory system."

However, as anti-uranium activists, such as the Survival Office Saskatchewan, pointed out, the accident only exemplifies a situation of creeping pollution which already had enormous impact on the ecology. The mill releases over seven million litres of waste water per day which, though passing through settling ponds, still carry heavy metals and radioactivity to Wollaston Lake (36).

Cameco appeared in court in December 1989, to face charges of negligence arising from the spill - with a theoretical maximum penalty of $C1 million and jail sentences of three years maximum for officials (38).

In a report on the incident, the Saskatchewan Environment Minister agreed that Cameco was negligent in not maintaining a flow-alarm system, and not ensuring monitoring of the pipeline by visual and other means: however, he also said that water samples showed that the spill "clearly...had no impact on the water quality" in adjacent water courses (39).

In April, the Hatchet Lake Band of Wollaston Lake - represented by Chief Ed Benonie - was given Intervenor Status in proceedings taken against Cameco for the November 1989 disaster. Meanwhile, some 33 anti-uranium organisations in the north organised a protest meeting to support demands by the Band that a full public inquiry should be held into uranium mining in the region (40). Cameco was fined C$10,000 under the Atomic Energy Control Act of 1946 - the maximum penalty applicable to this proceeding - after pleading guilty to two charges of negligence. The Atomic Energy Control Board also told Ed Benonie that it could not propose a national inquiry into uranium mining, as it went beyond its mandate. However, Saskatchewan and Environment and Public Safety has decided to bring Cameco to court under the provincial Environmental Management and Protection Act, charging it with the release of contaminants leading to "the reasonable possibility" of water pollution; on these grounds Cameco could be fined up to one million Canadian dollars (41). In October 1990, the Atomic Energy Control Board met with Indian representatives in the Wollaston Lake area, but a few days later renewed the Rabbit Lake operating licence for another two years.

Ed Benonie renewed his calls for a Royal Commission of Inquiry "with real power to examine the uranium industry and its impact on the people, economy, and the environment of the north." The appeal has been backed by a large number of Indian organisations and others, including the Canadian Labor Congress, the Canadian Public Health Association and Greenpeace (41).

Contact: AIM Survival Group, PO Box 8536, Saskatoon, S7K 6KG, Canada.

Collins Bay Action Group, Lac La Hache Band, Wollaston Lake, S0J 3C0, Canada.

Green Party, Saskatoon Chapter, PO Box 9053, Saskatoon, S7K 7E7.

Chief Ed Benonie, Wollaston Lake, Saskatchewan, Canada S0J 3C0.

Contact: Survival Office Saskatchewan (SOS) Box 9395, Saskatoon, Saskatchewan, Canada S7K 7E9

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214 Eldor Resources Ltd

Formerly Gulf Minerals Canada, it was purchased and renamed by Eldorado Nuclear in 1982. It holds one-sixth of the Key Lake Mining Corp which operates the Key Lake mine in northern Saskatchewan (1).

In mid-1983 Eldor received approval from the Saskatchewan provincial government to develop the Collins Bay "B" deposit which it had inherited from Gulf Minerals. This was to maintain Eldor's milling of uranium in the area beyond 1985. The company was intending to triple milling capacity by the end of 1983, to which end C$114.2M was spent in 1982 (2).

Concerted opposition to the opening of Collins Bay "B" and the continued operation of Rabbit Lake has come from many groups, not least the Lac La Hache Band Administration (Native Canadian) based at Wollaston Lake.

In an Open Letter to band councils, community councils, anti-nuclear groups and other concerned groups and individuals, dated July 13th, 1984, the Band made several demands. Because of the importance of these mines to the nuclear industry and the myth that Saskatchewan native people are in favour of uranium mining, most of the Open Letter is reproduced here:

"We are concerned about the uranium mine development that is taking place on the west side of Wollaston Lake, only 20 miles across the lake from our community of 700 people .... From 1975 to 1977 untreated wastes [from Rabbit Lake] were released into Hidden Bay of Wollaston Lake. These wastes are now "treated", however the settling ponds they pass through have no leakage- proof liners, so radioactive contaminants are still leaking into Wollaston Lake through the ground water channels. A study done by Environment Canada in 1978 determined that "the water quality of Horseshoe Lake has deteriorated considerably since 1972" and "elevated radionuclide levels were detected in the Rabbit Creek system especially in the Sedimentation Lake sediments". Tests by the Environmental Protection Services on several occasions found ammonia levels high enough to kill trout in the tailings effluent which goes into Effluent Creek and on to Hidden Bay.

Eldorado Resources is now developing the Collins Bay "B" zone orebody, 6 miles north of the Rabbit Lake Mine. This mine operation is even more dangerous because ore is under the lake. They have already built a dyke between two islands, drained the water from this area, and have begun to dig the open pit. They will soon begin to dig out the ore. The dyke is made with thin sheet steel pipes, rocks and earth and is only 4 feet above the water level. If water from the lake comes into contact with the ore in the pit, the radiation will spread to the whole lake. This dyke will be removed when the mine closes in 6 years. The radioactive tailings from this mine will be placed in the old Rabbit Lake pit. No leakage-proof liners will be installed. Radium-226 and other radioactive "daughters" will leach into the ground water channels which flow into Wollaston Lake for possibly thousands of years.

... The uranium mines that were operated by Eldorado at Uranium City, Saskatchewan, have permanently contaminated the land and water. Three lakes are now dead: nothing will grow in them. Huge piles of waste rocks and mine buildings have been left to release radiation into the air, land and water. Most of the people moved out when the mines closed in 1982. We do not want the same thing to happen here.

We have always used this land for hunting, trapping, fishing, and berry-picking. We still obtain most food from hunting and fishing. About 50 people still trap and about 50 commercial fish. The exploration and mining is destroying these livelihoods. At least 10 men have their traplines in the area where mining and exploration is being done. As Councillor Martin Josie has stated: "Now because of the white people like the Department of Northern Saskatchewan, prospectors, and mining companies, the animals are becoming scarce. Even the moose are hard to kill now and because of the mines the animals are not fit to eat."

Only two men received any compensation for the losses of their traplines. Contamination of the lake may destroy commercial fishing.

Elder Helen Besskaytare has also expressed concern about the mines. "Nowadays if you kill some ducks they're skinny, not like they used to be. I hear now you can get cancer from eating the waterfowl. People used to live to be in their '60s or '70s. People lived off fish and berries. But now people are dying from cancer and we know it's from the mines. Now we can't even eat bears because we're afraid what they may have eaten from the mines. What I'm really concerned about is the kids in the future. If the water is contaminated and not fit to drink and the fish are not fit to eat, what are the children going to live on?"

Only 5 people have permanent jobs at Rabbit Lake and 5 are now employed at Collins Bay. People from Wollaston Lake are often refused jobs because they lack training, but the mining companies won't provide any training. Employment for a few people is not adequate compensation for the destruction of the environment. As then Chief Joseph Besskaystare stated: "At a meeting here in 1977 with the government and mining company officials, I told them NO to the mine because of what it might do to the lake. In about 35 years you people will be finished mining. All the workers will go but we will still be here. After the water is contaminated, what are going to live on?"

Many workers from uranium mines have died from cancer. Over 30 miners from Uranium City and over 400 miners from the Elliot Lake, Ontario, mines have died from cancer. We do not want this to happen to Wollaston Lake people.

The people of Wollaston Lake opposed the opening of the Rabbit Lake Mine at meetings held here with the government and mining companies in 1972 and 1977. We unanimously opposed the opening of Collins Bay "B" zone at Hearings held here and La Ronge in 1981. The Government of Saskatchewan refuses to listen to us and allows uranium exploration and mining to continue.

At a community meeting here on June 13, 1984, people again expressed opposition. Band Councillor Martin Josie stated: "We, the Chief and Band Councillors, will not agree to have the Collins Bay Mine opened. This mine concerns everybody because Wollaston Lake flows everywhere, North, South, East and West. We will be very happy for any people that protest against Collins Bay "B" zone development. If people protest in other places, not only Wollaston Lake, it will be good."

The Open Letter announced a petition - to stop Collins "B" and all other uranium developments in the area - which would be presented to Neil Hardy, Minister of the Environment in Saskatchewan.

The Open Letter was signed by Hector Kkailther, Chief, and several Band Councillors. The petition made reference to "the five thousand Chipewyan and Cree people of Wollaston Post and the seven nearby communities" affected by uranium mining, whose aboriginal land rights were being violated.

In 1988, Eldorado Nuclear and the Saskatchewan Mining Development Corporation (SMDC) merged to form Cameco, now the world's biggest single holder of uranium reserves and producer of uranium. Further information about development of the Rabbit Lake and Collins Bay deposits can be found under Eldor Mines.

Technically, neither Eldor Resources nor Eldor Mines exist any longer.

Contact: Lac La Hache Band Administration, Wollaston Lake, Saskatchewan S0J 30O, Canada.

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SOURCE: "The Gulliver File - Mines, people and land: a global battleground" by Roger Moody.

Published in 1992 by Minewatch, 218 Liverpool Road, London Nl ILE, UK, and WISE-Glen Aplin, Po Box 87, Glen Aplin Q 4381, Australia.

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