Smaller players are digging deeper—but not for nickel

Aug 21, 2008 | 11:38 AM |

If it seems like the trillion-dollar Sudbury mining region of Ontario has a fresh glow to it, there's an easy explanation the increasing number of new projects focused on high concentrations of copper and precious metals located deep beneath the surface.

While nickel remains the undisputed king of the Sudbury Basin—a 37-mile-long, 18-mile-wide metallic motherlode created by the impact of a giant meteorite almost 2 billion years ago—mining companies both large and small have been digging deeper and unearthing copper and precious metal deposits in areas that have long since been abandoned.

Nickel prices have tapered off considerably from their highs last year of almost $25 per pound—they're closer to $10 per pound in today's market—but copper has been trading near record highs this year and gold and platinum have soared to once-unimaginable levels. There are few signs of a significant pullback.

FNX Mining Co. Inc., Toronto, is one of the companies at the forefront. Led by executive chairman Terry MacGibbon, a veteran of the former Inco Ltd., it has quickly made a name for itself as the Sudbury Basin's No. 3 nickel producer after Vale Inco Ltd. and Xstrata Plc's nickel division, the company formerly known as Falconbridge Ltd. The company focuses on acquiring what were considered non-core assets of the major players, including rich but hard-to-get-at footwall deposits. The existence of these have been known for a long time, but only recently garnered significant attention thanks to the robust bull market for copper and precious metals.....