Deal would see FNX pay most of $5M road upgrades – by Darren MacDonald (Sudbury Northern Life – November 25, 2013)

Company needs stronger roadway to move ore mined from its Victoria site

A cost-sharing deal between the city and a mining company would see about $5 million in upgrades to Crean Hill Road and Fairbank East Road in the Worthington area.

FNX Mining, which is now owned by KGHM International Ltd., will pay 75 per cent of the cost of the project, with the city picking up the remainder. The 75-25 deal will stay in place regardless of actual costs, although both sides can walk away if bids for the construction contract are too high.

The company needs roadways its heavy trucks can use open year-round to make its Victoria Advanced Exploration Project economically viable. It approached the city to negotiate an agreement to upgrade the roads, which currently are subject to load restrictions in spring when melting snow softens the ground considerably.

“The terrain in the Worthington area generally consists of low-lying swampy areas with occasional bedrock outcrops
and hills,” says a staff report on the proposal. “Crean Hill Road and Fairbank East Road are rural surface treated roads. The roads in their current condition have a relatively low structural strength. Both roads have minimal gravel shoulders and roadside ditches, with occasional cross-culverts under the road for drainage purposes.”

Improvements will see more gravel added to bolster the strength of the roads, improved drainage, paving the surface and shoulders, and they will be straightened in some areas.

In exchange for paying the majority of the costs to upgrade the roads, KGHM wants the city to agree to not impose load restrictions, and not charge the company for routine road maintenance.

The company plans to extract copper, nickel and precious metals from its Victoria site, an underground mine. It’s developing the site under an arrangement with Vale, in which KGHM will build and operate Victoria as the sole owner of the project, with Vale receiving a royalty, as well as agreeing to buy the ore extracted from the mine.

City council is expected to vote on the cost-sharing arrangement at its meeting Tuesday evening.

Comments are closed.