Vale and Glencore are digging deep to dig deep. Each company is committing about $700 million to develop new mines and will be using cutting-edge, automated machines to reach the ore located more than two kilometres below the surface.
Vale is going ahead with its Copper Cliff Deep project, which includes refurbishing the south shaft at the Copper Cliff complex and eventual access to an ore body beneath Kelly Lake. The first phase is pegged at $760 million.
Glencore has freed up about $900 million for Onaping Depth, a new project near Craig Mine that will burrow 2.6 km into the earth. Jean-Charles Cachon, a professor in marketing and management at Laurentian University, said the price tags for these projects are typical of the industry.
“A study done through the University of Toronto and a large consulting firm established that $700 million is the average cost of a new mine in Ontario,” he said.
Cachon said it’s also not unusual for the two companies to pursue new projects around the same time, noting Vale’s Totten Mine and Glencore’s Nickel Rim South went forward in near lockstep. Neither of the new projects took shape overnight, he added.
“Both Onaping Depth and Copper Cliff Deep were in the pipeline for several years before they were put into exploitation,” he noted. “It was the same thing, in fact, for Totten Mine and the South Rim. Sometimes they take two or three years longer to build or put into production.”
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