Sudbury Star just announced bad news for Timmins about Xstrata Copper Canada closing the zinc and cooper metallurgical plants, which existed for well over 40 years in that region. 670 workers will be out of jobs by May 1st, 2010.
Only the non hydro-intensive concentrator and mine site will remain open, maybe until 2017. Both those operations do not operate on a hydro intensive diet like the zinc and cooper smelters. It is more than likely that Timmins has indeed lost out to its smeltering operations to Quebec, where energy prices are strategically lower than that its neighbours. This bad news story should be a good news story for the natural resource industry located in New Brunswick where they will learn in a hurry about the benefits of having Hydro-Quebec as your guardian. According to the North Bay Nugget, the smeltering operations of the ore mined out of the Timmins mine will be shipped to Rouyn Noranda’s Horne operations and CCR, in the Montreal area.
Also, Timmins residents who have voted repeatedly for contrarian but well respected politicians (Charlie Angus federal – NDP and Gilles Bisson Ontario-NDP) are now wondering whether their NDP politicians can do anything in a province led by Liberals and a Canada led by Conservatives.
One cannot underscore the power of discounting the hydro-electric bill when planning for capital investment in any resource based province. But while Ontario is redesigning its new Mining Act in hopes of offering investment certainty to mining companies, it is dealing with the obvious reality that it will only get “extraction” investments, like Africa because it has no Hydro-Quebec type infrastructure to increase refinery operation investments.
The announcement just a few weeks’ ago by Kria Resources is disclosing its discussions with Xstrata about a toll treating deal and a net smelter sharing interest. Kria has its mining operations in New Brunswick and Xstrata is inviting more ore to process in its New Brunswick smeltering operations. No doubt the hydro electric future looks bright for natural resource companies operating in New Brunswick.