Adex Mining Inc. has high hopes for productive mine operation in Charlotte County

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With prospecting and mineral exploration ongoing throughout New Brunswick, one junior mining company believes it has a head start in developing a productive mine in Charlotte County.

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Canadian junior mining company Adex Mining Inc. has focused its attention on the development of its flagship holding, the Mount Pleasant mine property situated in Charlotte County, approximately 80 kilometres south of Fredericton and 65 kilometres from the U.S. border.

Kabir Ahmed, Adex’s president, chief executive officer and director, noted his company began the long process from exploration to production at Mount Pleasant with a wealth of knowledge about the potential of the project. In the mid-1980s, Mount Pleasant was an operating mine.

“That’s the unique advantage we have over our competitors,” explained Ahmed. “We already know it was a past-producing mine, and the quantity of those metals in the ground and the grade of those metals. And we know where and how much of those metals we have.”

Those metals to which Ahmed refers is primarily tungsten and molybdenum, as well as tin and indium.

Ahmed noted prices for all four metals soared in recent years, and projections suggest demand and price will remain strong well into the future.

He explained estimates suggest demand for tungsten, which is used in the production of steel and other industries, will increase from 81,000 tonnes globally today to approximately 109,000 tonnes by 2012.

“So there’s a significant increase,” Ahmed said, noting the demand will be driven by the remarkable economic growth in China, India and the Middle East.

Demand for molybdenum, which is used as a high-strength alloy in steel, will also increase significantly.

As it will for indium, a mineral primarily used in the electronics industry in the making of the thin-film coating for plasma and high-definition televisions.

“All the metals at Mount Pleasant have great, we believe, long-term foreseeable demand,” said Ahmed.

While future demand and price make the Mount Pleasant mine a potentially lucrative investment for Adex going forward, it was the depressed mineral prices which forced previous mine operators Billiton Exploration Canada to shutdown operation in 1985. Adex purchased Mount Pleasant in 1995.

The Billiton operation left behind more than a record of proven resources on site, said Ahmed.

“More importantly,” he said, “we have incredible infrastructure on the site. For example, the tailings pond would have cost a brand new mining company between $20 and $30 million and two to three years in regulatory approvals.

“So we got a lot of infrastructure to basically fast-track us and our ability to bring that into production. The only thing we now need to do is simply bring those resource estimates, through a confirmatory drill program, to current standards then expedite a feasibility study which would then allow us to obtain a mining lease or mining license which then allows us to resume production.”

Ahmed explained Adex is currently operating on the first phase of the process to restore mining in Mount Pleasant. The “approval to operate,” granted by the province, allows Adex to do exploration and drilling, carrying out feasibility testing, metallurgical testing and operate the tailings pond on site.

Ahmed said the “first-phase” approval reflects “a great deal of confidence” on behalf of the province for Adex and its management team. He said Adex hopes to complete the first phase over the next 12 to 18 months.

“We’re very unique in the sense we know what we have and it’s simply a matter of articulating a pathway to production now,” explained Ahmed. “That’s what we’ll focus on. We’re not in an exploration, early-grassroots place here. We have proven resources. We’re simply embarking on a drill program to bring those resource estimates to current standards. Once we are able to do that, which we hope will be in June, we can commission feasibility studies and reports.

“We hope to do that over the next 12 to 18 months with a view of resuming metal production in the next two to three years.”

That, Ahmed pointed out, is a substantially shorter turnaround time than the development of most productive mines, which take on average at least five to 10 years.

While Ahmed is confident Mount Pleasant has a bright mining future, he fully understands the challenges which are inherent for any junior mining company.

“I think one of the key challenges is to, of course, always have a sufficient treasury,” he said. “As you know, mining and mineral companies, by the very work they do, aren’t revenue producing until much later in the life cycle. So we’re always looking to the equity market to raise additional funds so we do have proper funding to take us all the way to production. Fortunately, we raised sufficient funding in 2007 to give the company 12 to 18 months of activities.”

Ahmed said the second big challenge is to find quality professionals to take the project to production. He noted the company already employs several New Brunswick professionals and consulting companies.

A graduate of Saint John High School in the mid-80s, Ahmed said he has a keen interest in delivering a positive economic impact in the province.

He estimates a fully-operational mine would employ approximately 200 people, with a payroll between $15 and $20 million per year.

The third major challenge for any junior mining company, Ahmed noted, is long-term demand. But he sees no reason the demand won’t still be strong when Mount Pleasant comes on line.

Adex Mining Inc. is listed on the TSX Venture Exchange under the stock symbol “ADE.”

En français : Adex Mining Inc. a déjà initié la première phase de son plan visant à doter le mont Pleasant, dans le comté de Charlotte, avec une opération minière pour les prochaines deux à trois années.