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One mine, a multitude of economic benefits

March 17, 2014

Any new employer and enterprise in Ontario should be celebrated for the job and business opportunities it provides.  Every one boosts the province’s economy, produces tax revenue to support infrastructure and provides stability to society.  Because of the large scale involved, the start-up of a new mine multiplies the positive economic impact of most new businesses.

Last month, Vale officially opened the Totten nickel-copper mine in the Sudbury Basin.  It is located in Worthington, which is about 40 kilometres west of Sudbury.  Senior company management, employees, the Premier, the Minister of Northern Development and Mines, local First Nations leaders and municipal officials were on hand to show support and participate in the mine’s opening ceremonies.  For sure this was an event worth celebrating, so let’s look at some of the numbers behind this new mine to see what benefits it offers.

The capital expenditures to bring the new mine into production were $760 million – more than three-quarters of billion dollars.  The development of the project took seven years to complete.  In order to put this sum into perspective, the 2014 operating budget for the City of Greater Sudbury is projected at $502 million and the projected operating budget for Windsor in 2014 is $722 million.

“Totten Mine represents a significant investment in the future of our operations in Ontario and across Canada,” said Peter Poppinga, President and Chief Executive Officer of Vale Canada.  “Vale is committed to its future in Canada and across base metals and we are pleased to be able to celebrate this historic milestone for our company and the Greater Sudbury community.”

During the construction phase of the mine, approximately 500 people including employees from different contractors were on the job site.  The mine is expected to be a major nickel and copper producer for 20 years and provide direct employment for 200 people.

Production from the Totten Mine is anticipated at 2,200 tons per day, which will provide 12% of the feed for the Clarabelle Mill.  The annual output from the mine is anticipated to be 25 million pounds of copper, 20 million pounds of nickel and significant quantities of gold, silver and platinum group metals.

If we use the economic study “Ontario Mining: A partner in prosperity building – the economic impacts of a ‘representative’ mine” as a guide, we can anticipate that Totten will support in addition to the direct employment approximately 450 indirect jobs in the mine supply and service sector and 320 induced jobs.  The study shows that most of this employment and the economic activity it generates will be local to Sudbury in nature.

Increased tax revenue to the federal, provincial and local governments will be substantial from the personal income taxes and property taxes paid by these employees and corporate taxes.  Also, a substantial amount of what the mine purchases that are essential to its operation (input costs in economic terms) will be acquired locally.

Being a newly designed and developed mine, Totten can boast some of the best technology, automation and environmental management.  It is also committed to sharing the mine’s economic benefits with the local Aboriginal community.

“Sagamok Anishnawbek congratulates Vale on their achievement and our First Nation looks forward to continuing to participate in the Totten Mine Project, including through employment, mine service delivery and environmental stewardship,” said Chief Paul Eshkakogan, Chief of the Sagamok Anishnawbek First Nation at the opening ceremony.  The Totten Mine provides direct employment, training and business opportunities for members of this First Nation.

New mines also make many direct contributions to the well-being of their communities — for instance, in the provision of medical centres, sports facilities, and recreation and community centers. In larger communities and in mining regions, they support and fund universities, colleges and research facilities. Vale has history of supporting and contributing to facilities such as these in the communities where its employees live.

Totten becomes Vale’s sixth mine in the Sudbury area.  It joins current operating mines Creighton, Stobie, Garson, Coleman and Copper Cliff North.  Vale Canada Limited is a wholly owned subsidiary of the Brazilian mining company Vale.  Vale’s nickel mining and metals division is headquartered in Toronto. It operates these six mines, a smelter and a refinery in Sudbury, directly employing about 4,000 people.

Like ore bodies beneath the surface of the earth, the economic benefits provided by one mine are much more than meets the eye, initially.


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