The Sudbury Star is the City of Greater Sudbury’s daily newspaper.
The first shoe has dropped at Vale’s Greater Sudbury operations as part of the company’s new “self-sustaining” push. Vale announced Thursday it is suspending operations at the Frood section of Stobie Mine by the end of the year. The 85 employees affected will be transferred to other operations.
“No employees will be laid off as a result of this decision,” said Vale spokeswoman Angie Robson. “While this move will affect approximately 85 employees, those employees working at Frood will be deployed to other areas of the operation, and all commitments under our collective agreements will be honoured.”
Robson said the move was a hard business decision that had to be made in difficult times. “Current market volatility, declining metal prices and falling demand for our products requires decisive action to ensure our business in Sudbury remains sustainable and robust throughout this challenging economic cycle,” she said. “Frood has a rich history and has been integral to our success for more than a century.
“However, after more than 100 years of operations, Frood is a remnant area that has low value ore and declining grades. In (times of ) lower metal prices, we are actually mining at a loss. At the same time, the area requires high capital investments in order to sustain production, so while the grades are going down, our mining costs there are increasing.
“This is not sustainable in any cycle, but especially in the current context.
“Vale remains strongly committed to our future in Sudbury. In this period of economic uncertainty, we will continue to monitor economic conditions very closely and to make disciplined operational decisions in the best long-term interests of our company, our employees and our community.”
Robson said in an interview the 85 are a mix of about USW Local 6500 members and nine managers.
Garson Mine and Garson Deep, as well as the still-underdevelopment Totten Mine, are all rumoured to be affected by the changes that are coming. Vale announced in December that Totten Mine would open in late 2013, rather than the originally planned second half of 2012.
Robson said the Frood announcement is all that is coming at this time.
“We can’t predict the future,” she said. “This is the decision that has been made to date. This is what we are announcing in terms of decisions. We do have some challenges and issues for Stobie Mine and our costs there, and we will be addressing that.”
For the rest of this article, please go to the Sudbury Star website: http://www.thesudburystar.com/2012/10/18/vale-shutting-down-frood-mine