Last month, I had the pleasure of participating in the 16th Annual Sudbury Mining Week, not as President and CEO of FNX Mining, but as the event’s Honorary Chairman.
It was appropriate to celebrate Mining Week in Canada, and especially in Sudbury – one of the most prolific mining camps in the world. In Canada, mining contributes $40 billion dollars or 5% of Canadian GDP every year and pays $4.7 billion in corporate taxes alone. This industry directly employs 370,000 Canadians and is the largest private sector employer of Aboriginals. Canada remains the leading source of new capital for the global mining industry accounting for 36% of the $53 billion raised in 2007 or net $19 billion.
As a mining engineer who has spent his career in Africa, the United Sates and Latin America, I can confirm that there are few places in the world where mining is embraced and supported as it is in Sudbury.
However even in Sudbury, it is important that the mining industry support events such as Mining Week to communicate with local communities and, perhaps, persuade some young people to consider this industry as a future career choice.
The Sudbury area is a 1.85 billion year old meteorite impact crater and the first mineral discoveries were made here in 1883. Let me give you a few numbers about Sudbury which may surprise even local residents.
The total ore mined to date in Sudbury is approximately 1.7 billion tons with 40 billion lbs of nickel, 36 billion lbs of copper, 70 million ounces of platinum, palladium and gold and 283 million ounces of silver recovered. At today’s commodity prices, total historic production and current known reserves in Sudbury represent a One Trillion Dollar value.
The community is the richest mining district in North America and among the top ten most important globally. Sudbury accounts for about half the mining activity in Ontario, Canada’s largest mineral producing province. The value of Ontario’s mining sector is about $10 billion annually. (2007 figures)
I think these numbers give you some idea of what an incredible mining area Sudbury is and the impact it has had on the wealth, not only of the Greater City of Sudbury, but of Ontario and Canada.
In addition, the community’s two colleges – Cambrian and Boreal – and one bilingual University – Laurentian – have many mining specific programs and industry related research that are turning Sudbury into a “Silicon Valley of the mining sector”. And I must not forget to mention the environmental success stories – revegetation programs, pollution abatement and lake restoration initiatives – of the past few decades that have been recognized around the world.
Furthermore, a large and innovative mining supply and service sector that exports their industry-related expertise around the world, makes the Sudbury Basin a world-class mining camp that all Canadians should be proud of. With the continued modernization and industrialization of China, India and many other developing countries around the world, Sudbury’s mineral commodities and mining expertise will continue to be in demand for generations to come.
FNX has been very fortunate to have operations in Sudbury. We have just opened our third mine since 2003 in Sudbury and have plans to double our production over the next 2-3 years. Most of our future production in Sudbury will be from high grade footwall (copper-nickel-precious metal deposits), which were only recognized in Sudbury in the last 25 years.
These new deposits, which occur behind the known nickel deposits, have rejuvenated the future of mining in Sudbury. We believe that FNX has been on the forefront of the exploration, discovery and development of footwall deposits. While we plan to double ore production in Sudbury over the next three years, we will increase revenues and margins at a significantly higher rate than the doubling of ore tons.
Our value at FNX has been driven by aggressive exploration. Over the past six years, we have spent $116 million on exploration in Sudbury and drilled more than 3.1 million feet. Given the extensive surface and undergraound infrastructure on our properties, it has allowed us to quickly convert our discoveries into cash flow.
We currently directly employ more than 700 people in Sudbury – 1,500 across Canada and the US. In 2007, FNX spent a total of $283 million on capital and wages in the Greater City of Sudbury. I also like to note that FNX is the largest Canadian producer left in the Sudbury Basin. Sudbury is our home and we are proud of that fact.
In 2008, Sudbury is celebrating its 125th anniversary. For over a hundred years, the courageous and innovative men and women of this community have successfully produced the nickel, copper, PGMs and other metals that the modern industrialized world needed. Most industry experts will feel there is at least another 100 years of production in this amazing mining camp. FNX Mining intends to grow and be part of that exciting future.
Finally, allow me to acknowledge and thank all organizers and volunteers who worked so hard to make Sudbury Mining Week a great success.
John Lill is President and CEO of FNX Mining. www.fnxmining.com