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NioBay Metals (TSXV: NBY; US-OTC: NBYCF) has suspended exploration activities at its James Bay niobium project located in the district of Cochrane on the traditional territory of the Moose Cree First Nation (MCFN) following a survey involving residents of the community in northeastern Ontario.
Results of the survey “indicated an intent to preserve the South Bluff Creek area from any development,” said the company, adding that the MCFN asked to meet with NioBay to talk about “ceasing its permitted exploration.”
“NioBay has repeatedly stated that it would not build a mine without the consent of the MCFN community,” the company said in a press release. “This project is still in the exploration phase and the company does not yet have information as to whether an economic operation may be viable at this location. The company will present the results of its exploration when this information is available.”
The Montreal-based company said that it was suspending all of its exploration activities until a meeting with MCFN is held and that its board of directors was “evaluating all options” available to the company regarding the matter.
NioBay acquired the 25.9-sq.-km. property in 2016 and completed a preliminary economic assessment (PEA) in 2020. In February, the company commenced a 15,000- to 20,000-metre exploration drill program to convert its inferred resources to the indicated category to complete the project’s prefeasibility study.
The PEA evaluated three mining scenarios: open pit, underground and a hybrid of both mining methods. The early-stage study forecast an annual average 5,470 tonnes to 6,283 tonnes of niobium, a metal included in Canada’s list of critical minerals. The study envisions a capital expenditure of $482 to $579 million with a mine life ranging from 23 to 30 years.
At an 8% discount rate, the project would generate a post-tax net present value of C$733 million to C$1 billion and a post-tax internal rate of return of 21.6% to 27.5% using metal prices of $45 per kg niobium. The PEA foresees an all-in- sustaining cost ranging from C$52.93 per tonne of niobium to C$75.08.
The project’s indicated resources total 29.7 million tonnes grading 0.53% niobium for contained metal of 158 million kg. Inferred resources add 33.8 million tonnes grading 0.52% niobium for 177 million kg.
Aside from its James Bay property, NioBay also holds a 72.5% interest in the Crevier niobium project and 47% in the Clairy copper-gold project. Both the early-stage projects are located in Québec.
Following the announcement, the company’s shares fell by C13.5¢ or 43.5%, to C17.5¢. This is the lowest that the company has traded in the last one year, beating its previous low of 26¢. The company has 71.15 million common shares outstanding for a market cap of C$12.47 million.
