“Aurelius Minerals could end up following in the footsteps of Atlantic Gold, by proving up a multi-million ounce gold resource in Nova Scotia,” boasts the headline of a March 9 feature by Alastair Ford in the online Proactive Investors publication.
The article begins:
“We see the opportunity for a couple of million ounces of gold,” says Mark Ashcroft of Aurelius Minerals Inc (CVE:AUL).
He’s talking about the potential at the company’s Aureus East and Aureus West projects in Nova Scotia, Canada, where drilling last year turned up some highly attractive intercepts on both projects and also gave some indication that there could be mineralisation between the two horizons too.
And then:
“We want to be the next Atlantic Gold,” says Ashcroft, referencing the St Barbara-owned subsidiary that operates a two million ounce gold project around 60 kilometres north of the capital of Nova Scotia, Halifax.
“That’s an operation that has all-in sustaining costs of around US$750 per ounce, and produces around 100,000 ounces per year. It shows that Nova Scotia is a destination where it’s possible to do things.”
And lest investors think this is just whistling in the dark, it’s worth noting that some pretty big names agree. Sprott Resource Lending is a prominent name on the Aurelius share register, alongside Northfield Capital and Dundee. The company’s management also owns a significant stake.
Aurelius Minerals is a Vancouver- and Toronto-based company, which calls itself is “a well-positioned gold exploration company advancing its flagship Aureus Gold properties.”
This is what Aurelius says about its Nova Scotia gold properties:
The Aureus Gold properties are made up of the Aureus East Mine, one of only two permitted gold mines and mills in the province, Aureus West, Tangier and the Forest Hill properties. The properties all have excellent year-round access and infrastructure. The Aureus Gold properties are operated by the company’s wholly owned subsidiary, Aureus Gold Inc., and are in Nova Scotia.
What is the Aureus East property?
But where is this “Aureus East mine” that is “one of only two permitted gold mines in Nova Scotia”?
This is what the company’s website has to say about it:
In February 2020, Aurelius Minerals Inc. (Aurelius) acquired 2672403 Ontario Ltd. (property owner, since renamed Aureus Gold Inc.) from Sprott Resource Lending for a total consideration of US$8,200,000 in deferred payments payable in cash or common shares of Aurelius Minerals Inc. The mine has seen over $30mm invested in development by previous owners. The Aureus East mine is permitted with extensive modern infrastructure including a 300tpd [tonne per day] mill with on site assay laboratory. The property can be accessed via provincial Highways and is serviced by provincial grid power.
Which doesn’t exactly answer the question of what or where the mine is.
To find out more, I went searching in the company’s June 2020 (NI) 43-101 Technical Report for its Aureus East Gold Property, prepared according to the “Standards of Disclosure for Mineral Projects” of the Canadian Securities Administrators.
Turns out that the Aureus East Property is what is “previously known as the Dufferin Gold Project or East Dufferin gold mine.” It is “approximately 1,068 hectares in area” and “located in Halifax County, in north-eastern Nova Scotia [sic], approximately 140 kilometres by paved highway northeast of Halifax.”
Aureus East, says the Technical Report, is “a property of merit.”
“The Property is 100% owned by Aureus Gold, a subsidiary of Aurelius Minerals Inc., through its recent acquisition of Aureus Gold Ontario from Sprott,” it states. The Technical Report also provides a table detailing the long and complicated history of the ownership of Port Dufferin property.
From 2016 until 2019, the Dufferin gold mine was owned by Resource Capital Gold Corp., which went bankrupt shortly after mining a bulk sample in 2018. Since then, the mine has been on “care and maintenance.”
But now, at least based on what Aurelius Minerals president and CEO Mark Ashcroft is telling Proactive Investors, the company seems to have big plans and hopes for the Aureus East / former Port Dufferin gold mine and its potential. And the company plugs it as if the mine were already “permitted,” ready to spring into action at a moment’s notice.
The 2020 Technical Report states:
The company also holds an Environmental Approval, and Industrial Approval for the Property, both of which remain in place and valid.
But does it? Er, no.
A search of all the industrial approvals issued by the Nova Scotia Department of Environment fails to turn up an industrial approval for the Aureus East / Port Dufferin mine.
Nor is there any record for the Port Dufferin gold mine on the Department’s list of environmental assessments of industrial projects in Nova Scotia since 2000.
Perplexed, I wrote to Nova Scotia Environment spokesperson Barbara MacLean to ask if Aurelius Minerals or Aureus Gold or any related companies did indeed hold valid environmental and industrial approvals for the Aureus East property.
MacLean replied that an Environmental Assessment was issued to Gerald McConnell, then president of Dufferin Resources Inc., on June 13, 1994 — nearly 27 years ago.
MacLean explained that the EA does not appear online because it predates Nova Scotia Environment’s electronic database, and went on to say:
The company has not made an application to the department to transfer the EA to Aurelius. Approval is required by the department to transfer an EA.
In other words, Aurelius does not have an active and valid environmental approval for the mine, despite what it says about the mine being “permitted.”
MacLean continued:
The company does not have an active or valid Industrial Approval, it expired on September 13, 2017. No mining activities can occur without an approved EA and IA. The department has clarified these requirements with the company.
That means that there is only one gold mine in Nova Scotia that does have valid permits, namely the Touquoy open pit mine in Moose River that belongs to Atlantic Gold / Atlantic Mining NS. That mine received its environmental approval from the province in 2008. The Touquoy mine was able to avoid a federal environmental assessment because it did not meet the production threshold that would have required such an assessment.
However, new federal regulations in 2012 meant that mines the size of the three new ones proposed by Atlantic Gold as part of its Moose River Consolidated Project in eastern Nova Scotia — at Beaver Dam, Fifteen-Mile Stream, and Cochrane Hill — all require joint provincial and federal impact assessments.
The assessment process for the proposed gold mine at Beaver Dam began back in 2017, and is still ongoing. The impact assessment for Fifteen-Mile Stream is into its third year, and the Cochrane Hill project was registered back in 2018.
So it’s difficult to imagine that an environmental assessment approved by Nova Scotia way back in 1994 for Port Dufferin is going to pass muster today.
As NSE spokesperson MacLean said:
Before the company [Aurelius Minerals] could proceed with any mining activities [at Aureus East / Port Dufferin], the department would ensure the company is held to current standards.
The Halifax Examiner is an advertising-free, subscriber-supported news site. Your subscription makes this work possible; please subscribe.
Some people have asked that we additionally allow for one-time donations from readers, so we’ve created that opportunity, via the PayPal button below. We also accept e-transfers, cheques, and donations with your credit card; please contact iris “at” halifaxexaminer “dot” ca for details.
Thank you!
Hi Joan. I’m circling back to this article because when you wrote it, I made a google alert for Aurelius. Well, it has gone off recently with cease trading orders for the stock. It seems that the company is in real trouble. I’m not well versed in this stuff but cease trade orders seem like a death knell for a publicly traded company. Might be good to look into what has occurred over the past few months at the company.
Good catch Joan Baxter!
Well, time to add another shady company’s name to the ol’ google alerts.
Its flabbergasting how many large companies have a fake-it-til-you-make-it MO in the business world when it comes to environmental approvals. Alton Gas is prime among them, obfuscating their permit and regulatory status (not compliant with Federal law) in the grey zones between Federal and Provincial jurisdictions.