TORONTO (miningweekly.com) – Vancouver-based junior project developer Copper Fox Metals on Monday said it had entered into a facilities study agreement with the British Columbia Hydro and Power Authority (BC Hydro), to study what it would take to supply power to the company's Schaft Creek project.

The facilities study agreement spelled out the terms and conditions for BC Hydro to perform a facilities study to assess the requirements to connect the Schaft Creek project to the forthcoming BC Hydro Bob Quinn substation and the associated system reinforcements.

Copper Fox said it had requested a 69 000 kV and more transmission voltage service and BC Hydro would now conduct a facilities study, which would include preliminary engineering design to develop equipment specifications; developing a project plan that would describe the Schaft Creek interconnection project, including a schedule for implementation of detailed engineering, procurement, construction, testing and commissioning; developing a +/-30% cost estimate for implementation of the Schaft Creek interconnection project; and developing internal (BC Hydro) documentation for financial approvals to proceed with the Schaft Creek interconnection project.

The study would start once the company had paid BC Hydro a deposit.

Copper Fox previously submitted a system impact study request to BC Hydro, following which an interconnection queue position was assigned to the Schaft Creek project and the system impact study was conducted. The queue position is used to prioritise study work and allocate interconnection costs.

The study was expected to be complete by May 31, 2014, and was estimated to cost more than $1-million to complete.

Upon completion and acceptance of the study, Copper Fox said it expected to sign a facilities agreement which would would see BC Hydro implement interconnection work, including detailed design and engineering, procurement for significant equipment and construction and commissioning of the facilities.

Upon entering a facilities agreement, Copper Fox would provide financial commitment to BC Hydro in the form of cash payment for the basic transmission extension and security for the system reinforcement portion.

The average timeline from execution of the facilities agreement to energising the transmission line is six months to three years, depending on the complexity of the project and the resources available.

The Northwest Transmission Line (NTL) is a 344 km, 287 kV transmission line between Skeena substation, near Terrace, and a new substation to be built near Bob Quinn lake. The line and substation were scheduled for completion in the spring of 2014.

The cost of the NTL was currently estimated at $561-million to $617-million. The federal government had pledged $130-million and AltaGas was contributing $180-million. This left an unfunded portion of $251-million to $307-million.

Copper Fox said one option to fund the shortfall was to source capital contribution from the initial mines connecting to the NTL, on a pro-rata basis.