A receiver has been appointed to help wrap up the affairs of the abandoned Mount Nansen and United Keno Hill mine sites.

Yukon Supreme Court Justice Ron Veale issued the order Tuesday afternoon upon the request of the Yukon and federal governments.

Federal official Dave Sherstone explained in a briefing this morning the intent is to have PricewaterHouse evaluate the properties and other assets, contact parties with an interest in the mine sites and present a plan of action to the court by the end of June.

The goal, said Sherstone, is to either sell the available assets and prepare a final abandonment plan or find a buyer willing to bring the operations back into production.

Sherstone said with the announcement last month in the federal budget that $3.5 billion has been set aside to handle contaminated sites in Canada, the time is right.

'There are some dollars there now,' he said, noting there was nothing budgeted recently specifically to tackle contaminated sites that fall under federal responsibility. 'There is a real good possibility the money would be there to wind these things up.'

Both Sherstone and Hugh Copeland of the Yukon government suggested while Mount Nansen will likely proceed to some form of final abandonment, there is a good chance PricewaterHouse can deliver a buyer for United Keno once a world class silver producer and a burning fire in the territory's economy.

In the case of Mount Nansen, it's likely the assets of bankrupt BYG Natural Resources can be separated from the environmental liabilities and sold off, Sherstone said. He said the assets, like valid mineral claims with gold potential, are quite separate from the environmental liabilities.

Separating the two, Sherstone noted, would tidy up the path to a final abandonment plan of the tailings pond, open pit and other liabilities at the site east of Carmacks.

Dealing with the situation in the Elsa area and the assets of bankrupt United Keno Hill Mines Ltd. will quite likely be a totally different matter, Sherstone said.

There are still mineable ore bodies, and valid mineral claims, as well as 96 different sites of environmental liabilities, from shafts to tailings ponds, he explained.

Sherstone said separating the liabilities from the assets and selling them off would be a much more complex task for the receiver.

But Copeland noted that at least a dozen parties have expressed an interest in the United Keno Hill properties. And with silver at $8.24 US per ounce the highest in more than 20 years the interest should remain strong, he suggested.

In the case of United Keno, however, the federal government still maintains any buyer must also accept responsibility for all environmental liabilities at the different mine sites, Sherstone confirmed.

Nevada Pacific Gold Ltd., a Vancouver-based mining company, walked away last June from its proposal to buy United Keno because it did not want to assume responsibility for all environmental liabilities, including some that occurred a half a century ago or more.

The difficulty in selling United Keno and its liabilities was referred to in comment yesterday by Veale, who presided over the court-monitored proceedings to have Nevada Pacific buy the Elsa operation.

Figures provided to Veale estimate the cost to permanently abandon United Keno Hill is $40.7 million, while the cost to permanently close Mount Nansen is estimated at somewhere between $8 million and $22 million.

Federal taxpayers have paid an estimated $6 million so far to babysit Mount Nansen since BYG walked away in 1999 after less than two years of production. The primary cost revolves around ensuring effluent from the tailings pond complies with approved standards.

Taxpayers have paid about $2.8 million to look after United Keno since United Keno Hill Mines Ltd. called it quits in January 2001. The operation has been dormant since 1989 when production seized amid slumping silver prices.

Under the Devolution Transfer Agreement of April 1, 2003, Ottawa remains responsible for all mine sites approved under its watch.

Both Sherstone and Copeland emphasized it's time to get on with matters at both sites.

Copeland expects final abandonment of Mount Nansen could be in hand in two or three years. Sherstone suspects if a buyer is not found by June for United Keno, there could be a decision by the end of the year to move into abandonment mode.

After all, said Sherstone, failure to come up with a buyer for United Keno this time would account for three strikes; AMT Canada entered into an agreement to buy the assets only to have local creditors pull the plug after the company failed to make the required down payments; and then there was the proposal by Nevada Pacific.

If strike three comes for what was once a world-class silver producer, it could be the signal it's time to get on with final abandonment plans as opposed to keep paying the millions it costs to care for and maintain the Elsa mines, Sherstone explained.

Admittedly, said Sherstone, yesterday's court appearance was done with some stealth, in order to ensure there was no attempt by anybody to quickly liquidate any assets that might be available in advance of a receiver being appointed.

The court was told, for instance, the while BYG is defunct, it still might hold shares in two publicly traded companies including Tagish Lake Gold Corp. that would be liquidated if word got out a receiver was going to be appointed.

Sherstone noted outside the courtroom late yesterday afternoon that a fellow from Ontario claiming to be a BYG director was at the site in November with a prospective buyer.

Not even local creditors who are owed large sums of money by United Keno and had worked directly with both AMT Canada and Nevada Pacific to put a deal together were told of the move to appoint a creditor, Sherstone admitted.

Documents requesting the appointment of a receiver were delivered to the courthouse Monday afternoon just as clerks were locking the registry office. They were unavailable for public review Tuesday morning, as they were with the judge in preparation for the afternoon hearing.

Janet Patterson, a spokeswoman for Yukon Energy, which is owed $680,000 by United Keno, said this morning the publicly-owned corporation wants the Elsa mines to go back into operation.

'It would be good for the Yukon economy and it would be good for us because we would be selling them power, and we would be able to recoup some of the money we are owed.'

Yukon Energy, she said, wrote off the debt as a loss in 2002.

Whitehorse lawyer Paul Lackowicz, who represents Yukon businesses owed money by United Keno, said he was not in a position to comment this morning on the appointment of PricewaterHouse.

He said he received the documents late this morning, and had not had a chance to talk to his clients.

Unlike the situation in Faro where the receiver, Deloitte and Touche of Toronto, also managed the care and maintenance of the site worth $14 million over the last year PricewaterHouse will not manage care and maintenance at BYG or United Keno, Sherstone explained.

He said that responsibility will stay with the Yukon government, and will be fully reimbursed by Ottawa.

PricewaterHouse, he reiterated, will focus on what needs to be done to either sell the assets or start the move to permanent closure.