A new Toronto-based mining company has become the latest firm to make a play for northeastern Minnesota’s non-ferrous minerals along the Duluth Complex, south of Ely.

Duluth Metals has announced the results of its latest independent resource analysis, which now estimates 347 million tons of mineable ore, containing copper, nickel, and platinum group metals, in a five-square kilometer region located about eight miles southeast of Ely, near the south fork of the Kawishiwi River.
Company CEO Henri Sandri says the findings significantly exceed the company’s expectations, both for total size as well the grade of the ore. “This result vastly exceeds even our most optimistic expectations,” said Sandri.

Scott Wilson RPA, a qualified resource analyst, recently presented the findings, which were based on test drill cores obtained by Duluth Metals this past winter. The company conducted the drilling along what is known as the Maturi Extension, which is located near the US Forest Service Experiment Station along Hwy. 1.
The eastern edge of the Maturi extension lies approximately two miles from the Boundary Waters Canoe Area Wilderness, near Gabbro Lake.

According to Sandri, the company is planning an aggressive development schedule for the site. In an online interview with the Wall Street Journal, Sandri said the company plans to drill 35 additional test holes. He also said work on a pre-feasibility study for a mining operation there could begin before the end of 2007. The company issued an initial public stock offering late last year to raise money for its development plans.

Duluth Metals was formed last November as a spinoff from Wallbridge Minerals, which has leased the Maturi extension for a number of years. The development team includes a number of experienced individuals, including Sandri, who formerly worked for INCO Mining, as well as individuals formerly with Wallbridge and Teck Cominco.

While Sandri said the company is pleased with the results so far, officials are even more optimistic about land on the eastern end of the Maturi Extension. To date, the company has focused its attention on the western end, but Sandri said the eastern end appears to hold even greater promise. “That’s where some of the highest grades are found,” he said.

Duluth Metals’ recent announcement is further evidence that the international mining industry is increasingly turning its attention to northeastern Minnesota. In addition to Duluth Metals, PolyMet Mining is actively pursuing its own non-ferrous mining operation at the NorthMet site, south of Babbitt. In addition, Fraconia Minerals is in development of two other sites along the complex. Franconia CEO Ernie Lehmann said he hopes to begin permitting for mining operations at Birch Lake as early as mid-2008.

“I’m not sure people fully recognize the size and the potential of the Duluth Complex and where this will actually go,” said Duluth Metals’ Sandri. He said as much as four billion tons of mineable ore may exist along the complex, which stretches from near Aurora to the end of the Spruce Road, southeast of Ely. “That ranks as the third largest nickel body and the fourth largest platinum play in the world. This is very significant,” he added.

Lehmann, who is also president of the Minnesota Exploration Association, said the Duluth Complex promises to breathe new life into the Iron Range’s mining economy. “It probably won’t rival the taconite industry in numbers of jobs, but in terms of Minnesota’s gross domestic product, it could come close,” he said.
Lehmann said the resource also has strategic and economic importance nationally. “It is really the only viable nickel resource within the US,” he said. “And it is a significant platinum group metals resource. From both a strategic point of view and our balance of payments, these are good things. We now import 100 percent of our nickel and 90 percent of our platinum group metals.”

But Lehmann acknowledged that much work remains before any of the companies currently operating in the area are ready to begin mining ore. “Just like us, it [the Duluth Metals site] will take substantial capital to develop. They have a major amount of work to do to move forward to that point.”