Wabush woes: Labrador mining town reels from a China slowdown – by Rachelle Younglai (Globe and Mail – November 29, 2014)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

WABUSH, LABRADOR — Ron Barron has spent 30 years working in the Wabush mine, one of three generations of Barrons who have toiled in the open pits in what western Labrador bills as the iron ore capital of Canada.

The family’s roots run deep here. Mr. Barron’s father was one of Wabush‘s first settlers, who not only got a job in the mine when it opened in the 1960s but also helped organize a union. Five of Mr. Barron’s brothers have worked in the same pits along with his son and nephew.

But now Mr. Barron’s life has been upended along with the rest of city. The Wabush mine, once the cornerstone of this community, is shutting down along with another iron ore mine called Bloom Lake in neighbouring Quebec. More than 1,000 miners will be out of work, not to mention a slew of other job losses from businesses that service the industry. It’s a crippling blow in an area with a population of about 9,000.

“Oh my god, everybody loses. All the organizations, the schools, everything loses. Everything will suffer because of it,” said Mr. Barron, who will be officially out of a job by mid-December. “We have had shutdowns and layoffs before, but this is different. The mine is closing.”

The reason for the closings is simple: The price of iron ore, a key ingredient in steel, has been in freefall, falling 60 per cent in three years. Where the resource once traded as high as $190 (U.S.) a tonne in 2011, it is now below $70.

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NEWS RELEASE: Labec-century-awarded-the-2014-explorer-of-the-year-award-cim-newfoundland-branch

TORONTO, CANADA–(Marketwired – Nov. 10, 2014) – Century Iron Mines Corporation (“Century” or the “Company”) (TSX:FER) is pleased to announce that its 60% owned joint venture, Labec Century Iron Ore Inc. (“Labec Century”), received the “2014 Explorer of the Year Award” from the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) – Newfoundland Branch at its annual awards banquet in St. John’s on November 8, 2014.

The award recognizes the significant advancements in iron ore resource development and exploration at the Joyce Lake DSO (“Direct Shipping Ore”) deposit, which is 100% owned by Labec Century and located in Newfoundland and Labrador.

“Receiving this award is a great honour. Labec Century is proud to have discovered the Joyce Lake DSO deposit from early stage prospecting in a previously unknown DSO area in the Labrador Trough. It means a lot to us, coming from this prestigious professional association, and we are truly grateful for this recognition,” said Sandy Chim, Chairman of Labec Century and President and CEO of the Company.

The Joyce Lake project is the first DSO discovery in the area in three decades. Century and Labec Century together have invested almost eight years of work and approximately $30 million to bring the project to its current advanced stage of feasibility and environmental studies, which are expected to be completed in the first quarter of 2015.

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Iron failings [Labrador Trough] – Editorial (St. John’s Telegram – July 04, 2014)


The Labrador Trough may have seen a feeding frenzy in its day, but the herd seems to be thinning. Lured by cheaper iron from competitive sources, customers have been moving on to greener pastures.

The latest victim: Labrador Iron Mines, which announced Wednesday it’s suspending operations on both sides of the Labrador-Quebec border.

Over the past financial year, the company lost $105.2 million, compared to a net loss of $129.7 million a year ago. It said 2014 will be a “development year” as it concentrates its efforts on its Houston Mine, located near Schefferville in northern Quebec. That project is slated to begin production in April 2015.

In February, Cliffs Natural Resources announced it was idling its operations in Wabush indefinitely, leaving 400 employees out of work. But optimism still springs eternal among government and industry officials.

Two days after the February closure, Premier Tom Marshall was in Wabush announcing that Newfoundland and Labrador Hydro had been instructed to forge ahead with a third line to supply power from Churchill Falls to Labrador West.

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New Cliffs CEO visits Iron Range, predicts stable times for taconite – by John Myers (Duluth News Tribune – March 6, 2014)


VIRGINIA — In his first 100 days on the job, Gary Halverson closed Canada’s third largest iron ore mine, halted a chromite mining project in Ontario and worked to fend off a Wall Street demand that his company split up.

Other than that, it was mostly uneventful for the new president and chief executive officer of Cliffs Natural Resources.

Halverson spent Thursday on the Iron Range, where his company operates three of Minnesota’s six major taconite iron ore operations, saying his company is “shrinking to grow’’ but predicting a good year for its part of the state’s taconite industry.

Halverson, speaking to Iron Range business and community leaders, said he expects U.S. automakers to build 16.5 million vehicles in 2014, 1 million more than 2013; that new construction should increase 6 to 8 percent this year; and that U.S. steel demand should increase 4 percent this year over last, creating a good market for his company’s taconite iron ore.

“We’re about back to full production at NorthShore (mining) and we expect to produce between 22 and 23 million tons of pellets this year’’ at U.S. operations, Halverson said, noting that’s up from 21 million tons in 2013.

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Asian steel giants flexing muscle in Canada’s Labrador Trough – by Mariaan Webb (MiningWeekly.com – February 28, 2014)


The booming commodity prices of the last decade have sparked considerable interest in the Labrador Trough – Canada’s main iron-ore district which extends through northern Quebec and Labrador – and while dozens of the junior developers that have flocked to the region are now struggling to finance their projects, international steel giants continue to flex their muscle in the region.

Steelmakers are increasingly investing in iron-ore mining assets and the resource of Canada’s main iron-ore production centre is a favourite among steel producers, which are seeking to reduce their reliance on the traditional centres, such as Brazil and Australia.

“Whereas many of the mining companies are struggling, we are seeing steelmakers from around the world, particularly Asia, investing in the Labrador Trough,” says Toronto-based analyst Adam Low, of Raymond James. The Canadian iron-ore district has attracted investment from all the major Asian steel-producing countries.

“You have one of India’s largest steelmakers, China’s first- and third-largest steelmakers, the world’s largest steelmaker, one of Japan’s biggest trading companies, Korea’s largest steelmaker and Taiwan’s largest steelmaker all investing in the Labrador Trough.

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Ministers on the ground in Wabush – by Ty Dunham (St. John’s Telegram – February 18, 2014)


Government pledges to help displaced workers transition into new jobs

Displaced mine workers in Wabush have been offered help from the provincial government with apprenticeship and worker development programs.

Approximately 400 mine employees have been worried about the future ever since Cliffs Natural Resources announced last week that the Wabush Scully Iron Ore Mine was being idled.

Advanced Education and Skills Minister Kevin O’Brien said his department has a range of programs for those affected. “We can train people not currently trained. We understand there is a highly skilled workforce at Wabush Mines as well,” he said.

Last week, Premier Tom Marshall said cabinet ministers will visit Labrador West regularly to work with the communities to help with the transition. Ministers have met with union officials, municipal leaders and companies to identify opportunities for skilled workers as quickly as possible.

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UPDATE: 500 workers affected as Wabush Mines idled (St. John’s Telegram – February 11, 2014)


Cliffs Natural Resources is shutting down production at Wabush Mines, affecting 500 workers currently employed there.

The news was confirmed in an official statement by the company. The statement was not specific to the status of Wabush Mines, but instead focused on a more than 50 per cent slash in the company’s capital spending across its business year over year.

Premier Tom Marshall has issued a statement in response to the news. “The decision by Cliffs Natural Resources to idle its mining and processing operations at the Scully Iron Ore Mine in Wabush is very disappointing. While we believe this was undoubtedly a difficult decision for Cliffs, our thoughts are with employees of the mine and their families during this challenging time,” Marshall said.

“I will be in Wabush this week with Ministers Dalley and McGrath for discussions with stakeholders. We will continue to further opportunities for development in Labrador West. We remain confident in the future of the mining industry in the region.”

Wabush Mines started pulling ore from the Scully Mine in 1965. The ore goes to a concentrating plant at site and is then moved, by rail, to Point Noire, Que.

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Off Brazil’s coast, a national oil dream suffers a setback – by Stephanie Nolan (Globe and Mail – October 22, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

RIO DE JANEIRO — A strange-bedfellows consortium of Chinese and European firms bought the rights to exploit Brazil’s biggest-yet oil discovery with the national oil company, in a highly anticipated auction that fell flat and exposed international misgivings about the government’s management of the energy sector.

Anglo-Dutch energy giant Royal Dutch Shell PLC and France’s Total SA each bought 20 per cent of the consortium to develop the huge Libra offshore oil find, while China National Petroleum Co. and China National Offshore Oil Corp. each took 10 per cent. Brazil’s national oil producer Petrobras added 10 per cent to its 30 per cent mandatory share.

Only 11 foreign companies signed up to bid, far fewer than the 40 that Brazil’s oil agency had originally expected, and in the end only these four were part of the sole offer.

The poor turnout signalled international concerns about the government of Brazil’s heavy role in Libra, and may be seen a setback for the country’s vision for the project to kick-start its flagging economy and provide widespread social benefits to its citizens.

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Northern Promise: Mining projects spark much-needed Sept-Îles port expansion – by Nicolas Van Praet (National Post – September 17, 2013)

The National Post is Canada’s second largest national paper.

Northern Promise is a six-part series that explores the pace and progress of development in Canada’s remote communities. In this fifth instalment, Nicolas Van Praet explores mining projects in northern Quebec

SEPT-ÎLES, Que. – The sun is setting on a cool September evening in this northern Quebec port town and three cargo ships sit anchored in the half-moon bay.

From this distance several kilometres away, the ocean-going freighters look like giant match sticks waiting to be struck. Above them, storm clouds hang like a menacing hook and behind, you can sketch the outline of North America’s biggest primary aluminum smelter — Alouette, its hill-perched electrolytic pots powered by transmission wires stretching from Hydro Quebec’s massive Churchill Falls hydroelectric facility.

Sept-Îles, named for the seven-island archipelago that fronts the bay, is a 10-km wide natural harbour in the Gulf of the St. Lawrence some 650-km downriver from Quebec City. The waters here are deep, plunging down as much as 80 metres, and they’re free of ice for year-round passage — a huge advantage for commodity producers getting their goods to market.

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Concern growing over Sept-Îles oil spill – by Lynn Moore (Montreal Gazette – September 9, 2013)


MONTREAL — An oil spill that happened more than a week ago in Sept-Îles might be far more serious than first reported.

Quebec Environment Minister Yves-François Blanchet visited the area Sunday while cleanup crews tried to contain a large slick before tides and winds take the oil out into the Gulf of St. Lawrence.

While Blanchet urged a more “aggressive approach” to preventing oil spills during his visit, local environmental groups worried about damage to aquatic life in Sept-Îles Bay and beyond.

Overnight on Aug. 31, bunker oil was spilled near a shipping operation of an iron ore pellet plant operated by Cliffs Natural Resources Inc. at Pointe Noire. While the “source of the incident” is under control, investigation into the cause of the incident is ongoing, the company said Sunday.

Some media reports have pointed to a botched reservoir transfer as being at the heart of the problem. Environment Quebec has said that about 450,000 litres of bunker oil were spilled.

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Hope muted but persistent for Labrador Trough iron rush – by Keith Norbury (Canadian Sailings-Transportation & Trade Logistics – August 27, 2013)


Signs abound that enthusiasm for new iron ore mines in the Labrador Trough have tapered off since February 2011 when the spot price was nearly $190 a tonne. Since then, prices have been on a roller coaster, which experienced more downs than ups. They dipped as low as $87 last September, soared back up over $150 in February, and then tumbled back down to below $115 in June.

Coinciding with that volatility, Canadian National Railway suspended a feasibility study on a new $5 billion rail line to serve potential new mines in the Labrador Trough. Mining giant Rio Tinto has put up for sale its 58.7 per cent interest in Iron Ore Company of Canada, one of the Trough’s and Canada’s largest iron ore producers.

Champion Iron Mines Ltd., one of the promising junior players in the Trough, abruptly pulled out of its participation in a new multi-user $220 million multi-user iron-ore port at Pointe-Noire in Sept-Îles, Que. And Cliffs Resources shut down indefinitely its pelletizing plant at Pointe-Noire.

Despite those setbacks, the consensus among financial analysts and economists who follow the trials and tribulations of the iron ore industry, as well as of industry insiders, is that long-term prospects for ramping up iron ore production in the Trough remain solid.

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