WATER USE AND WASTE DISPOSAL PERMIT

Pursuant to Article 13 of the Agreement Between the Inuit of the Nunavut Settlement Area and Her Majesty the Queen in Right of Canada, the Nunavut Water Board, hereinafter referred to as the Board, hereby grants to Echo Bay Mines Limited, authorization to alter, divert or otherwise use water and dispose of waste in conjunction with the dewatering of Occurrence 8 Quarry, subject to the terms and conditions outlined below:

PERMIT NO:	NWB2OCC9799
PERMITTEE :	Echo Bay Mines Ltd.

Lupin Operations

Bag No. 1

Nisku , Alberta

T0C 2G0

Tel: 403-890-7000	Fax: 403-890-8766
START DATE:	August 1, 1997
EXPIRATION DATE:	October 31, 1999
PURPOSE:	Water Use and Waste Disposal associated with Dewatering of Occurrence 8 Quarry.
LOCATION:	Located Approximately 7 km due south of the Lupin Mine Site located 65 46' N, 111 14' W as shown in Figure 1 appended to this permit.

This permit issued and recorded at Gjoa Haven includes and is subject to the annexed conditions.

Approved by,

Philippe di Pizzo, Executive Director

PART A: SCOPE

1.	Compliance with the terms and conditions of this permit does not absolve the permittee from responsibility for compliance with all applicable Federal, Territorial and Municipal legislation.

2.	This permit is issued subject to the conditions contained herein with respect to the taking of water and the depositing of waste of any type in any waters or in any place under any conditions where such waste or any other waste that results from the deposits of such waste may enter any waters.

3.	Whenever new Regulations are made or existing Regulations are amended by the Governor in Council under a future Nunavut Waters Act, or other statutes imposing more stringent conditions relating to the quantity or type of waste that may be so deposited or under which any such waste may be so deposited, this Permit shall be deemed, upon promulgation of such Regulations, to be subject to such requirements.

PART B: GENERAL CONDITIONS

1.	The water use fee shall be paid in advance as set out in Schedule 1 annexed to this permit.

2.	The Permittee shall file an annual report with the Board no later than January 31st of the year following the calendar year reported, which shall contain, but not be limited to, the following:

a.	a summary report of the waste disposal activities,

b.	a summary of the abandonment and restoration of the site,

c.	a list of unauthorized spills and follow-up action taken, and

d.	a tabular summary of all data generated under the "Surveillance Network Program" as outlined in Part D of this permit.

3.	All spills of oil, fuel, or other deleterious materials shall be reported immediately to the 24-Hour Spill Line at (403) 920-8130.

4.	The permittee may carry out modifications to the planned undertaking;

a.	Without approval from the Board, provided that they are consistent with the terms of this Permit and the Permittee has notified the Board in writing of such proposed modification at least five (5) days prior to beginning the modifications; and

b.	With the written approval of the Board and under such conditions as outlined by the Board.

5.	The permittee shall ensure that any chemicals, fuel or wastes associated with the project do not enter waters frequented by fish. All sumps and fuel caches shall be located a minimum of thirty (30) metres from the normal high water mark and in such a manner that no fuel can enter any such water body.

PART C: CONDITIONS APPLYING TO THE UNDERTAKING:

1.	The deposit of debris or sediment into any water body is prohibited. These materials shall be disposed of above the high water mark in such a fashion that they do not enter the water.

2.	All waste water to be discharged from the Occurrence 8 Quarry Pit shall be pumped such that flow enters Post Lake which is located due south of the quarry.

3.	Discharge rate shall be between 0.004 and 0.006 m3 /sec.

4.	All waste water shall be discharged in such a manner as to prevent erosion from the drainage pathway to Post Lake.

5.	Daily inspection of the flow route shall be performed to ensure erosion is not occurring. If erosion is occurring, discharge of waste water is to cease immediately and notification of change in operation shall be given to the Board.

6.	All waste water discharge from the Occurrence 8 Quarry shall meet the following effluent quality requirements at Station 100-2:

Parameter	Maximum Average	Maximum Concentration

Concentration	of Any Grab Sample

Total Arsenic	0.5. mg/l	1.00 mg/l

Total Copper	0.15 mg/l	0.30 mg/l

Total Lead	0.10 mg/l	0.20 mg/l

Total Nickel	0.20 mg/l	0.40 mg/l

Total Zinc	0.40 mg/l	0.80 mg/l

Total Suspended Solids	15 mg/l	30 mg/l

Oil and Grease	5.00 mg/l

pH	6.0-9.5

7.	The Permittee shall provide at least ten (10) days notice to an Inspector prior to any planned discharge from the Occurrence 8 Quarry.

8.	Prior to discharge, the Permittee shall file with the Board a plan which proposes methods of treatment should the waste water or drainage water not meet the discharge requirements as specified in Part D, Item 6.

9.	All rock materials removed from the quarry shall be disposed of in the Tailings Containment Area as identified in Licence N7L2 -0925, Part D, Item 6.

10.	All acid-generating materials shall be disposed of such that they are isolated within the Tailings Containment Area so as not to contribute to lowering the pH within the tailings system.

11.	The NWB shall be notified of any changes in operating plans or conditions associated with this water use and waste disposal activity.

12.	If operating plans change, the Board shall be informed thirty (30) days prior to any such change.

PART D: SURVEILLANCE NETWORK PROGRAM

1.	The permittee will take samples from the following locations:

100-1	Occurrence 8 Pit.

100-2	Final waste water discharge at end of pipe.

2.	Water at station 100-1 shall be sampled prior to planned discharge for the following parameters to ensure waste water is acceptable for discharge, and analysed for the following parameters:

ICP Metal Scan (Dissolved and Total)

pH

Total Suspended Solids

3.	Water at station 100-1 shall be sampled and analysed daily during discharge for the following parameters:

Total Suspended Solids	Total Zinc

Total Arsenic	Total Copper

Total Lead	Total Nickel

pH

4.	Following the dewatering and reclamation of rock material from the quarry, water at station 100-1 shall be sampled monthly during periods of open water and analysed for the following parameters:

Total Suspended Solids	Total Zinc

Total Arsenic	Total Copper

Total Lead	Total Nickel

pH

5.	All sampling and sample preservation shall be conducted in accordance with procedure and methods approved by the Board.

6.	All analyses shall be performed in a laboratory approved by the Board.

7.	The total daily quantities of water discharged from the quarry shall be recorded and reported in cubic metres.

8.	The permittee shall, within thirty (30) days following the month being reported, submit to the Board all data and information required by the "Surveillance Network Program".

SCHEDULE I - LICENSING CONSIDERATIONS

I.	APPLICATIONS FOR LICENCE AMENDMENT, RENEWAL, ASSIGNMENT OR CANCELLATION.

1.	An application for an amendment or renewal shall be in the form set out by the Board and shall contain the information identified therein and be accompanied by a deposit equal to any water use fee that would be payable under subsection II (1) in respect of the first year of the licence that is being applied for.

2.	The fee payable on the submission of an application for the amendment, renewal, cancellation or assignment of this licence is thirty (30) dollars.

3.	An application for authorization for the assignment of the licence shall be submitted to the Board in the form set out by the Board, accompanied by the fee set out in (2), no less than 45 days before the date on which the applicant proposes to assign the licence, and shall:

c.	Be signed by the assignor and the assignee; and

d.	Include the name and address of the assignee.

4.	An application for cancellation of a licence shall be in writing and shall set out the reason for the requested cancellation and a description of the measures taken or proposed to be taken, prior to cancellation, for abandonment of the appurtenant undertaking.

II.	WATER USE FEES

1.	The fee payable by the licensee for the right to the use of water, calculated on an annual basis, in respect of an industrial, mining and milling undertaking or miscellaneous undertaking, is the greater of thirty (30) dollars and the aggregate of:

a.	For the first 2,000 m3 per day that is authorized by the licence, $1 for each 100 m3 per day,

b.	For any quantity greater than 2,000 m3 per day but less than or equal to 4,000 m3 per day that is authorized by the licence, $1.50 for each 100 m3 per day, and

c.	For any quantity greater than 4,000 m3 per day that is authorized by the licence, $2 for each 100 m3 per day.

2.	For the purposes of paragraph (1), where a licence authorizes the use of water on a basis other than a daily basis, the licence fee payable shall be calculated by converting the rate of authorized use to an equivalent daily rate.

3.	Where the volume of water is specified in a licence to be total watercourse flow, the licence fee will be calculated using the mean daily flow of the watercourse, calculated on an annual basis.

4.	Licence fees are payable only for the portion of the year during which the licence is in effect.

5.	The licence fees shall be paid:

a.	In respect of a licence for a term of one year or less, at the time the licence is issued; and

b.	In respect of a licence for a term of more than one year:

i.	For the first year of the licence, at the time the licence is issued, and

ii.	For each subsequent year of the licence, or for any portion of the final year of the licence, in advance, on the anniversary of the date of issuance of the licence.

III.	SECURITY DEPOSITS

1.	Security deposits shall be in the form of:

a.	A promissory note guaranteed by a bank in Canada and payable to the Receiver General;

b.	A certified cheque drawn on a bank in Canada and payable to the Receiver General;

c.	A performance bond approved by the Treasury Board for the purposes of paragraph (c) of the definition "security deposit" in section 2 of the Government Contract Regulations;

d.	An irrevocable letter of credit from a bank in Canada; or

e.	Cash

2.	Security deposits shall be furnished by the licensee:

a.	In respect of a licence for a term of one year or less, no later than 30 days after the licence is issued; and

b.	In respect of a licence for a term of more than one year:

i.	For the first year of the licence, no later than 30 days after the licence is issued, and

ii.	For each subsequent year of the licence, or for any portion of the final year of the licence, in advance, on the anniversary of the date of issuance of the licence.

SCHEDULE II - GENERAL CONDITIONS FOR THE ADMINISTRATION OF PERMITS

ISSUED BY THE NUNAVUT WATER BOARD (NWB)

1.	At the time of issuance, a copy of the Permit is placed on the Water Register in the NWB Head Office in Gjoa Haven, and is available to the public.

2.	To enforce the terms and conditions of the Permit, the Department of Indian Affairs and Northern Development designates Inspectors in a manner consistent with the Memorandum of Understanding between the Department of Indian and Northern Affairs and the NWB. The Inspectors coordinate their activities with the NWB staff and officials of the Water Resources Division of DIAND. The Inspector responsible for Permit No. NWB2OCC9799 is located in the Nunavut District office.

3.	To keep the NWB and members of the public informed of the Permittee 's conformity to Permit conditions, the Inspectors prepare inspection and compliance reports which detail observations on how the Permittee has met each condition in the Permit. These reports are forwarded to the Permittee with a covering letter requesting what action, if any, should be taken. The inspection reports and covering letters are placed on the Water Register, as are any responses received from the Permittee pertaining to the inspection reports. It is therefore of importance that the Permittee react in all areas of concern regarding inspection reports so that these concerns may be clarified.

4.	If the Permittee contemplates the renewal of Permit No. NWB2OCC9799 , it is the responsibility of the Permittee to apply to the NWB for renewal of the Permit. The past performance of the Permittee , new documentation and information, and issues raised during a public hearing, if the NWB is required to hold one, will be used to determine the terms and conditions of the Permit renewal. If the Permit expires before the NWB issues a new one, then water use and waste disposal must cease, or the Permittee will be in contravention of the Nunavut Land Claims Agreement. The NWB recommends that an application for the renewal of Permit No. NWB2OCC9799 be filed at least two months before the Permit's expiry date.

5.	If Permit No. NWB2OCC9799 requires amendment, then a public hearing may be required. The Permittee should submit applications for amendment as soon as possible to give the NWB sufficient time to go through the amendment process. The duration of the process may vary depending on the scope of the amendment requested.

6.	The NWB can modify the Surveillance Network Program annexed to the Permit without a public hearing. Requests for changes to the Surveillance Network Program should be forwarded to the NWB in writing, and should include the justification for the change.

7.	Any communication with respect to this Permit shall be made in writing to the attention of:

Philippe di Pizzo

Executive Director

Nunavut Water Board

P. O. Box 119

Gjoa Haven, NT. X0E 1J0

Telephone No:	(403) 360-6338

Fax No:	(403) 360-6369

8.	Inspection and enforcement of the terms and conditions of this Permit are performed by:

Nunavut District Office

Northern Affairs Program

Department of Indian Affairs

and Northern Development

P. O. Box 100

Iqaluit, NT. X0A 0H0

Telephone No:	(819)979-4405

Fax No:	(819)979-6445

9.	The Permittee shall submit all reports, plans and studies to the Board in three copies.