North American Palladium stays ahead by investing in its facilities and equipment, including a modern, up-to-date fleet of trucks.

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Environmental concerns are top-of-mind for many in the exploration and processing industry. However, North American Palladium, a leading Toronto-based metals producer, can rest more easily knowing that about half of the palladium it produces is used to reduce harmful substances such as hydrocarbons, carbon monoxide and nitrous oxides in vehicle exhaust emissions.

The properties of palladium and other platinum group metals (PGM) make them an ideal choice for auto catalysts to convert harmful emissions into benign elements such as carbon dioxide, nitrogen and water. “In effect, we produce a metal to clean the air we breathe,” North American Palladium says.

Headquartered in Toronto, Ontario, North American Palladium is Canada’s leading producer of palladium. Vice President Dave Passfield says the company produces about 4 percent of the world’s palladium supply. However, palladium is just the tip of the company’s operations.

“Our company name says ‘palladium,’ but we’re really a multi-metal producer,” he explains. “We also produce gold, platinum, copper and is one of Canada’s largest producers of nickel in concentrate. This diversification gives strength, so if one price goes down we have some cushion with the others.”

Operating for Success
Today, North American Palladium operates the Lac des Iles Mine, an open pit and underground mine located in northern Ontario. Lac des Iles is the largest primary palladium mining operation in Canada today.

In 1990, Madeleine Mines Ltd. developed the property. Commercial production started in 1993, a 2,500-tonne-a-day open pit operation. The company reorganized into North American Palladium Ltd., and in 2000, commenced an expansion program. In 2001, the company commissioned a 15,000- tonne-a-day mill. In 2004, the company commenced development of an underground mine, Roby Zone, in order to access higher-grade ore beyond the pit design limits. The underground mine reached commercial production in early 2006.

In addition to Lac des Iles, in 2006, North American Palladium entered into joint venture agreement with Vale-Inco on the Shebandowan West Project located southwest of Thunder Bay, Ontario. The property presents potential synergies with the Lac des Iles Mine, and falls in line with North American Palladium’s strategy to focus on high-quality, nickel-copper-PGM targets. Another notable project Passfield points to is the Arctic Platinum Project. In March 2006, the company entered into a formal option and joint venture agreement with South Africa-based Gold Fields Ltd. to develop the Arctic Platinum Project in northern Finland. Currently in the definitive feasibility study stages, the project includes several advanced-stage PGM projects. Passfield notes the Arctic Platinum Project is a good strategic fit for the company because of its similarities in operating condition and deposit class with the Lac des Iles Mine. The Arctic Platinum Project contains a number of undeveloped copper-nickel-PGM deposits.

The third main project North American Palladium is focusing on is the Offset High Grade Zone at the Lac des Iles mine. This zone was discovered in 2001, adjacent to the current Roby underground operation. The stated resource is nearly three times as large as the current underground at similar grades and is still open at depth and along strike, Passfield explains.

In 2007, the company conducted an extensive exploration program from underground. North American Palladium is undertaking scoping studies to verify the economic potential of this deposit which could significantly extend Lac des Iles’ operating life.

“We’re always open to pursuing different ventures if the right opportunities come through the door,” Passfield states. “But, right now, with our manpower, we’re concentrating our efforts on those three projects.”

Staying Competitive
At the Lac des Iles mine, workers are in a camp setting – working one week on, one week off, Passfield explains. “The mine is located only about 90 minutes outside of Thunder Bay, so we’ve been fortunate to attract a lot of people in various job categories,” he says. “The pulp and paper mill industry used to be the big economic driver in northwestern Ontario, but it has since declined.

“So, a lot of those workers are looking at mining – and North American Palladium – as an alternative.”

Although the company faces the same challenges to find qualified workers as others in the industry, Passfield says North American Palladium wages and benefits are comparable to other similar operations.

However, the company isn’t immune to turnover. “We do lose some people, especially because the oil sands industry is booming,” Passfield acknowledges. “There are opportunities overseas in remote areas that offer very high compensation for workers.

“So, if we have labor needs that we can’t meet with our own work force, we look to contractors to fill short term needs.”

Investing in its equipment and facilities helps North American Palladium stay ahead, as well. Passfield notes the company’s mill is less than seven years old and features up-to-date technology and control systems. “Our underground mining fleet is only a year or so old,” he states. “We bought the most modern, up-to-date Sandvik fleet available, including 60-tonne-capacity trucks. We don’t have anything too proprietary, but we try to keep up to date.”

In addition to updating its equipment, North American Palladium updates its employees on safety initiatives through several programs. Each employee undergoes several days of safety orientation and training programs where the rules for each job, as well as Ontario mining laws, are discussed.

Expansion Through Experience
Although North American Palladium’s management team is new, Passfield says the group has a wealth of experience in the industry. “We’ve got some great people on our team, and we’re looking to expand,” he states. “We’re always dealing with the cost pressures in terms of operations, but we’re faced with the same challenges as other mining operations: the price of oil, the price of metal, the upswing in the Canadian dollar.

“In order to manage that, we need to be diligent. There’s no magic bullet in terms of a secret process technology. We’re just trying to manage our projects.”