Wabowden News

Wabowden and surrounding communities face many challenges, social, political, and economic. The news summaries below, organised by topic, reflect that reality. The rationale behind their inclusion is the belief that the school and its students need to be aware of local challenges and add their voices to discussion on how best to address them. In order to contribute, however, students need to be critical thinkers, able to sift through information and make sense of it. Therefore, the following news summaries are designed to model critical thinking through analysis. Each article has been reviewed and summarised with the following questions in mind. How informative is it? Does it clarify issues? Does the writer display bias? Are any questions left unanswered? What new information is revealed? How does it add to the topic at hand? Is the reader left hanging?

21 November 2009: “Banking on big nickel deposit: If northern mine proves feasible, it means work for 400 people” [Winnipeg Free Press, B4]

There could be a new nickel mine in Manitoba before long that would provide employment opportunities for the neighbouring communities of Wabowden, Cross Lake, Grand Rapids, Moose Lake, and Norway House. On 20 November 2009, Victory Nickel Inc. made a presentation at the Manitoba Mining and Minerals convention in Winnipeg to highlight a proposed new mining development at Minago, which is about halfway between Grand Rapids and Ponton near Highway 6. Victory had spent “close to $30 million developing the property over the last 10 years, and was awaiting the third-party feasibility study that “could set the table for another $450-million mining project in Northern Manitoba.” According to Rene Galipeau, Victory’s vice-chairman and CEO, “This could be a mega-project.” Indeed it could be as large as the Lalor mine, which is forecast to cost $450 million to develop. It would be an open-pit mine and require 400 people to operate it. Chris Beaumont-Smith, a senior minerals policy and business development official with the province’s Department of Innovation, Energy and Mines, said, “It could be spectacular. There is much to do before that could happen, as Victory Nickel is a junior exploration company based in Toronto with only about $5 million in the bank and no revenues to speak of.” However, if the feasibility study proved positive, it could enable the company to get financial backing from the banks. It got a boost in August 2009, when “Jilin Jien Nickel Industry Co. Ltd., China’s second-largest nickel, bought close to 20 per cent” of its shares.

The project certainly looks promising. The deposit is close to Highway 6 and to the Hudson Bay Railway (HBR), which is only about 60 kilometres away. Hydro power is also nearby. Talks have also been held with OMNItrax, which owns the HBR, about a potential business partnership. The company has also signed memorandums of understanding with three of the First Nations in the area – Grand Rapids, Cross Lake and Moose Lake – and believes it has their support.

Norway House had not come on board at time of writing, but Dave Chomiak, Manitoba’s Minister of Innovation, Energy and Mines, said that “there had been significant positive developments over the last few years between the mining industry and the aboriginal community in Manitoba.” He added, “The really good news is that the mining industry is looking for hundreds of workers in the future, and we have got a lot of people that are underemployed and a lot of First Nations people who want to be involved.”

Update (14 December 2009): Victory Nickel announced that the feasibility study for the Minago Open Pit Mine was positive. According to Rene Galipeau, this was a “major milestone” for the development of Minago. Early in 2010, the company will “create a project execution plan, begin road construction on site, select financial advisors to structure financing and submit the Environmental Impact Statement with a view of receiving environmental and operating permits before the end of 2010. In addition, consultations with local Aboriginal groups and other stakeholders can now be continued with a better understanding of the opportunities that are potentially available to local communities.”

Update (22 December 2009): Victory Nickel Inc. announced that it had expanded its property position at Minago by staking 11 additional claims at its 100%-owned project in the Thompson Nickel Belt. It now controlled the entire limestone outcrop, which will be used to produce building materials for the construction of access roads and a link to Highway 6. Building will start in the winter of 2009-2010.

Minago is one of “Canada’s largest undeveloped sulphide nickel deposits and has been shown to be capable of producing a nickel concentrate grading up to 22.3%, making it the world’s highest grade nickel concentrate. In addition to metal by-products such as copper, cobalt, gold, platinum, palladium, silver and rhodium, a layer of silica sand averaging approximately 9 metres thick overlies the nickel mineralization within the open pit. Approximately 84% of this 15 million tonne … sand resource is marketable frac sand, which is used to improve recoveries in the oil and gas industry. The frac sand forms part of the overburden that must be removed prior to mining the nickel ore.”

Discussion: How could the development of a new mine affect nearby Aboriginal communities? What additional things need to happen before this project gets underway?

15 March 2010: "Lunch Box Heroes: Eleanor Woitowicz and Katharina Stieffenhofer, "And This Is My Garden" (lunchbox's posterous)

"And This Is My Garden," by Katharina Stieffenhofer, is a documentary film about the Wabowden School Gardening Project that premiered in March 2010 and received an excellent review by Jacques de Beaufort on the Internet blog, “lunchbox’s posterous.” Both film and review are glowing tributes to teacher Eleanor Woitowicz and the students at Wabowden School who proved that gardening is "alive and well" in this community and that a new generation of gardeners is moving onto the scene. They also highlight the role of principal Bonnie Moneas, whose active support of the project assured full school participation and its ultimate success.

Gardening has a long history in Wabowden, and community gardeners like Minnie and Carl Fortney, Charlie Clark, Frances Hall, and others helped to keep it alive over the years. It was local interest that prompted the federal Department of Agriculture to establish a research station at Wabowden nearly fifty years ago, and Peter Braun, the agricultural representative in charge of the station, did a great deal to encourage local agriculture. The provincial Department of Agriculture, Soils and Crops Branch, became involved in 1970, when it appointed Jim Portree as its first Northern horticulturist. He was connected with the Thompson Greenhouse Research Centre that was under the direction of Dr. Joe Campbell, Professor of Horticulture at the University of Manitoba. Jim was one of the first to promote green houses to extend the gardening season at Wabowden. Frontier School Division came onboard after Lionel Orlikow became Chief Superintendent and hired Joan Butcher to head the Nutrition Health Program. Joan trained the nutrition health advisors throughout the division, including Wabowden’s Frances Hall, who from 1976 played a pivotal role in promoting nutrition and local greenhouses in her community. She had the complete support of Dinah Ceplis, who replaced Jim in 1980 as the northern horticulturist, and gave several years of excellent service to the promotion of agriculture throughout the north. The Wadowden School Gardening Project is just the latest step in efforts to promote gardening and Northern Manitoba agriculture in general. We hope it won’t be the last.

13 May 2010: “Wabowden garden project to be showcased at UN” (Manitoba Co-operator, V. 68, No. 19, p. 3)

The Wabowden gardening project is really going places. In early May 2010, it was showcased in New York City before the United Nations Commission for Europe on Sustainable Development. This is quite an achievement. “One of three selected out of 60 best-practice examples in 30 countries, it was selected “because it demonstrates how formal education can contribute to sustainability, and how whole communities can contribute to sustainable practices.” It also “exemplifies how Aboriginal communities contribute to and benefit from sustainability projects.” Eleanor Woitowicz, a retired school teacher, initiated the project, which “introduced school children to gardening by helping them plant, tend, and harvest their own vegetables in background gardens.” Eleanor, Bonnie Monias, another local teacher, and Don McCaskill, assistant superintendent, Frontier School Division, went to New York City to explain the details of the project, which has expanded to include “some 70 gardens now being planted by all members of the community.”

8 September 2010: “Mining is gold for jobs: Sector expects biggest raises, most jobs” [Martin Cash, Winnipeg Free Press, B6]

The mining industry is booming in Western Canada. According to studies by Manpower Canada on hiring expectations and Hay Group on salary expectations, things couldn’t be better.

Martin Cash interviewed Rod Cyr, owner of Rodren Drilling, who said they were “as busy” as they had “ever been” and although he wasn’t hiring any new people, he certainly wouldn’t be laying off any of his current staff of 80 people, who were “out working on jobs throughout the region with crews in Saskatchewan, Manitoba, and Ontario.”

According to Manpower there had been a jump of 16 per cent in “the expectations of mining companies to hire people this year compared to a year ago,” and the Hay Group forecast that salaries would increase by 2.6-2.7 percent. The average salaries of Manitoba “range from $72,000 to $100,000 with the more northern sites often paying premium rates.”

According to Cash, HudBay Minerals and Vale Inco were both hiring, and on 7 September 2010, there were 1400 job openings available in the Canadian mining industry. This coincided with a rebound from the recession because of demand from “China and other rapidly developing countries.” Nevertheless, the industry was “facing a skills and labour shortage and needs to add 100,000 jobs by the end of the decade.”

Discussion: Mining appears to be a lucrative option for young people living in Northern Manitoba aboriginal communities that have suffered from severe unemployment for many years. What could be done to encourage students to look at mining as a possible career? What part could Northern school divisions play in making this happen?

1 October 2010: “Snow Lake Mine financing plan lifts stock 30%” [The Canadian Press, as reported in Winnipeg Free Press, B4]

The shares of Alexis Mines, which owns the Snow Lake gold mine, went up by 30% on 30 September 2010, when the company announced that it had obtained a “financing package … from Legend Securities Inc., a New York based broker-dealer.” $45 Million would be allocated to “develop and refurbish the Snow Lake mine” and $15 Million to “working capital.”

The preliminary assessment in March 2010 of the deposits at Snow Lake indicated that the mine “could produce 423,000 ounces of gold over an estimated six-year project life at an estimated cost of about US$544 per ounce.”

Discussion: The article noted that the deal was “subject to satisfactory completion of due diligence and a feasibility study.” However, it looked as if the project was now going forward. Why was this good news for the future of Snow Lake?

2 October 2010: “Production halted at Bucko Lake nickel mine” [Martin Cash, Winnipeg Free Press, B4]

In October, Martin Cash reported that the Buck Lake nickel mine near Wabowden was being shut down “for the second time in less than a year,” putting 150 miners out of work.

The mine is owned by Crowflight Minerals, but it has been operated by a production company called Dumas Contracting Ltd. Now Crowflight wants to operate the mine itself.

Mark Tevisiol, CEO of Crowflight, said that it was updating its marketing plan for 2011 and hoped to have everything ready, so that it could hire miners and get back into production “early in the new year.”

The change could cost up to $20 million, but one of Crowflight’s largest shareholders, King Place Enterprises Ltd., a Chinese investment fund, would arrange the financing.

Crowflight built the Bucko Lake Mine in 2007 at the height of nickel prices (up to $25 a pound), but when it opened the mine in early 2009, the prices had dropped to $4, although they went up to over $10 in 2010. The mine shut down in November 2009 because Crowflight had “taken the wrong technical approach to the ore body and had to revise its strategy.” The changes did not produce the yields that the company wanted, so it had closed the mine again to make adjustments.

Crowflight faced plenty of challenges. It was in conflict with Dumas Contracting over the money it owed the production company, which had put a lien on the Bucko Lake property. It had to buy “a whole range of expensive equipment” and find “a skilled workforce in an already tight labour market in Northern Manitoba.”

As Cash pointed out, this would be a tall order because there were new mines opening.

Although Crowflight’s problems were challenging, Ed Huebert, executive vice-president of the Mining Association of Manitoba, considered them nothing more than a “setback.” “‘This is just business,’ Huebert said, ‘These things happen. Companies have to change contractors from time to time.’”

Discussion: Mining is an occupation that could provide a solution to the problem of unemployment in many northern communities. What could government do to promote the hiring of local people? What job training would be required, and who should be responsible for it? What role could community leaders in Northern Manitoba take in promoting ties with mining companies?

5 November 2010: “HudBay’s profits down, but development up” [Martin Cash, Winnipeg Free Press, B4]

HudBay’s profits were down in the third quarter of 2010. The problem was that the company “couldn’t move as much copper and gold concentrate from its Flin Flon operations … because the railroads could not make enough cars available for shipments, leaving the company with an excess inventory of about 5,000 tonnes of copper and 7,800 ounces of gold contained in the concentrate.” However, as Martin Cash pointed out, this wasn’t necessarily a bad thing, because prices for copper and gold were still going up, and a delay in getting them to markets would only mean more money in HudBay’s coffers.

Otherwise, the company was doing well. New mines were under development, like the $560 million Lalor mine at Snow Lake, which would be in full production in five years. A decision would be made in 2011 on the development of the high grade copper find at Reed Lake, south of Snow Lake. According to David Garofalo, HudBay’s new CEO, “It is literally a stone’s throw away from a provincial highway and HudBay’s experienced team will be able to bring it on stream quick and efficiently.” The company had a “70-per-cent partnership in that project,” as well as a 51 percent share in a Michigan mine, which was doing well. It also owned a “massive nickel mine in Guatemala” which was yet to be developed.

The company also had “$800 million-plus cash on hand,” a “$300-million credit facility” and “$1.2 billion in available liquidity.” Its shares were up on the Toronto Stock exchange. All boded well for the future.

Discussion: Although Cash did not dwell on it, why was the lack of rail cars a serious problem that needed to be addressed? CentrePort is under development in Winnipeg, and the Hudson Bay Railway (HBR) to Churchill is important to the success of the inland port. How could a close collaboration between HudBay, CentrePort, and the HBR be helpful in rectifying this problem? Why would it be mutually beneficial? What role should the provincial and federal governments play?

Considering the importance of the mining industry in Northern Manitoba, why is it important that educational facilities there take a leading role in preparing Northern Manitoba residents to take advantage of opportunities for jobs in this industry?

18 November 2010: “Smelter, refinery called unfeasible” [Martin Cash, Winnipeg Free Press, B5]

Just when Northern Manitoba was getting plenty of good news in the mining sector, Vale SA, the company that owned the smelter and refinery in Thompson announced (November 17) that these facilities were going to be closed over the next five years. That was the bad news. However, the good news was that it planned to invest “$1 Billion on its mining operations there.”

The problem from Vale’s perspective was that the plant needed to be upgraded to meet “federal standards for sulphur dioxide emissions,” and that upgrade would cost “$1-billion.” Moreover, the Thompson mine didn’t produce “enough nickel to operate the facility at full capacity,” which was necessary to make it cost-effective. To address the shortfall, Vale had been shipping 45% of the ore required for full capacity from the company’s Voisey’s Bay operation in Labrador, but that would stop in 2012, when a “$2.8-billion processing plant” was completed there [actually, the new processing plant was to be at Long Harbour, Newfoundland].

The closure of the smelter and refinery would eliminate 500-600 jobs, but they would be “managed by attrition” with “no layoffs.” A big challenge for the company was “attracting and retaining workers” in Thompson, and in November 2010 it still had “160 positions unfilled.”

Vale still intended to spend “as much as $1 billion developing new nickel resources in the area as well as $150 million to upgrade tailings containment.” It planned to “develop the 1-D project, part of its main Thompson Mine, and reopen the Pipe-Kipper open-pit operation that was closed several years ago.”

Discussion: From a business point-of-view, did the decision by Vale SA make sense? What steps had the company taken to ease the economic impact on the City of Thompson?

The company admitted to having difficulty recruiting and retaining workers in Thompson. One of the reasons was that Thompson was isolated and cold in the winter, workers came from outside the area, and they were generally separated by long distances from their families. Consequently, they often worked for a while, then returned to their homes. However, there is a large potential workforce in the communities surrounding Thompson. They have lived in the North all their lives, and Thompson is not far from their families back home. How could that potential workforce be harnessed? What training programs would be needed? How could they be implemented?

18 November 2010: “Plan to cut mine jobs blasted: Provincial leaders rush to Thompson, say Vale’s actions may violate deal” [Martin Cash, Winnipeg Free Press, B5]

Martin Cash summarised the reaction of the Manitoba government, which was clearly on the defensive in the wake of Vale’s announced closure of the Thompson smelter and refinery. Provincial leaders were upset that they were not consulted by Vale before the decision was made, and Premier Selinger announced that Energy and Mines Minister Dave Chomiak and Thompson MLA Steve Ashton would be going immediately to meet with Thompson officials and the mine workers.

The closure was described as “unacceptable” and possibly contravened a “54-year-old agreement with the province.” Chomiak claimed that Vale’s decision “appeared” to “violate a 1956 agreement negotiated with former mine owner Inco that included development of the Kelsey hydro dam to power the operation.” He added that the province “believed” that the agreement included the smelter and refiner processing facilities.

Steve Ashton, Thompson’s MLA, asked, “How does Vale think they can walk in and unilaterally wipe out what has been in place for that many years at a time when nickel prices are at historic highs? … This is not the way we do things in Manitoba.”

Cash noted that “Manitoba was the only jurisdiction to come out on the short end of the Brazilian mining company’s announcement it would spend $10 billion in Canada over the next five years to beef up its mining properties in Canada.” As one industry observer noted, “Ontario and Newfoundland and Labrador were successful in extracting concessions from Vale, but Manitoba was not.”

Union leaders were unhappy as well. Murray Nychyporuk, president of the United Steel Workers of America was “disappointed and frustrated.” From his perspective, “This was a corporate decision without any human element taken into consideration.” He was somewhat sceptical of Vale’s promise to manage “the workforce reduction through attrition,” and added that there were “20-year veterans in the smelter because they do not want to work in the mine.”

Discussion: This article suggested that the government was unprepared when Vale SA made its announcement. How do you know?

Evidently Ontario and Newfoundland and Labrador had been in negotiations with Vale SA. Is it reasonable to ask why Manitoba had not?

Keeping in mind the Manitoba government’s decision to locate BiPole III on the west side of Lake Winnipeg at an additional construction cost nearing [and possibly surpassing] $1-billion, and Vale SA’s decision to close its outdated Thompson smelter in favour of a brand-new processing plant at Long Harbour, Newfoundland, consider the irony in Steve Ashton’s comment concerning Vale’s decision, “That’s not the way we do things in Manitoba.”

Mining operations open and close, and miners often have to move on, painful as that can be for their families, as in the case of Lynn Lake and Leaf Rapids. However, there is a new processing plant opening at Long Harbour, Newfoundland. Is it an option for Thompson’s smelter workers to transfer to that new facility?

19 November 2010: “Thompson’s loss of jobs Canada’s gain: Clement” [Mia Rabson and Larry Kusch, Winnipeg Free Press, A12]

The issue of the impending closure of the smelter and refinery at Thompson was raised in the House of Commons by Churchill MP Niki Ashton. In response to her question, Industry Minister Tony Clement said, he was “sorry for Thompson but a $10-billion investment in mines is good for the rest of Canada.” Vale’s investments in Sudbury, Ontario, Long Harbour and Voisey’s Bay, N.L, and Saskatchewan would result in 1,000 permanent jobs.

Ms. Ashton was not pleased. She accused Clement of not being “committed.” After all, “Manitobans are just as Canadian as people in Sudbury, in Long Harbour and Voisey’s Bay.”

Clement responded. “The context of this … is that the announcement that is so affecting her community in a negative way is also part of a larger announcement where thousands of jobs will be created throughout the rest of the country … . I know she has to defend her people … but this is good for Canada in the overall.”

Rabson and Kusch then went on to explain that the Thompson smelter and refinery would be closed “because there is a shortage of mineral reserves for it to process … and it [Vale] could not meet tough new federal sulphur dioxide emissions standards that would require it to cut emissions from the Thompson smelter by 88 percent in five years.”

Ashton felt Clement should be taking the lead in bringing Vale to the negotiating table in order to “figure out how to save the smelter and refinery.” Premier Selinger indicated he wanted to meet, but it was “premature to discuss any incentives the province may offer Vale SA not to close the refinery.” When the meeting occurred, Selinger said, “We’ll sit down and see what they have to offer and what their thinking is and also put the case forward for why Thompson is a good place to do business.”

Opposition Leader Hugh McFadyen was critical of the government for not anticipating Vale’s decision. “He cited a 2005 Free Press article that said Thompson would only be processing ore from Newfoundland until Vale’s smelter there was completed.”

Discussion: Niki Ashton wanted to save the smelter and refinery at Thompson, but she never explained who was to pick up the bill for this. If Vale were to do this at a loss, how long do you think it would be before it went bankrupt? And, if it went bankrupt, what are the chances that anyone else would keep the smelter open at a loss?

If Premier Selinger were to offer “incentives” to Vale SA to keep the smelter open, who would pay for them?

Rabson and Kusch imply that Vale could not meet the tough new emissions standards at Thompson. In fact, they could have surpassed them. But why would they do this, if they were already in the process of building a new plant in Long Harbour, Newfoundland, that met current emission standards? Rabson and Kusch did not say.

19 November 2010: “Mining sector losing lustre: Conference kicks off with gloom from north” [Martin Cash, Winnipeg Free Press, B6]

The Manitoba Mining and Minerals Convention got off to a gloomy start with the announcement that Vale SA was closing the smelter and refinery at Thompson. Cash used this as a starter to discuss the other side of the mining industry in Manitoba. In spite of the good news stories at Snow Lake and other places in Northern Manitoba, the mining industry of Manitoba was facing “challenging” times ahead.

Mining exploration was down in Manitoba. Four years ago, the Fraser Institute ranked the province as No. 1 in the world “for mineral exploration and development.” Now it was No. 11, still a “solid ranking among the 51 jurisdictions,” but worrisome. “Even with strong base metal commodity prices,” mineral exploration had “dropped off dramatically in 2009-2010, and spending totals for 2010 were “the worst in the country.”

This appeared to be happening because of concerns about “levels of certainty and confidence in the provincial regulatory environment.” Cash reported on two of them.

Delays because of aboriginal land claims. “On that score, some industry players say there are long delays when it comes to the duty to consult First Nations whose land claims are in mineral resource exploration and development areas. For some reason the process has become more time-consuming in Manitoba than elsewhere in the country [emphasis added].”

Cash explained that the province “was grappling with the right model to use in its duty to consult First Nations on mineral exploration projects,” and the mining industry had “embraced” that process, “but for some reason the process in Manitoba was “more cumbersome than elsewhere.”

Creation of additional parks in Northern Manitoba. “Ed Huebert, executive vice-president of the Mining Association of Manitoba Inc., was beside himself after this week’s speech from the throne when the provincial government noted one million hectares of land have been permanently protected over the last 12 months and new protected areas will be added in the coming day.”

HudBay Minerals had reopened the Chisel North mine and was developing the Lalor zinc/gold/copper mine at Snow Lake.

Alexis Minerals was reopening the New Britannia mine, now called the Snow Lake Mine.

Reed Lake was on the verge of development by HudBay and VMS Ventures.

San Gold was finding more gold discoveries at Bissett and beginning to mine some of them.

Victory Nickel was still “hopeful about its Minago property near Grand Rapids.”

“Rolling Rock Resources Corp. had recently signed a memorandum of understanding with the Red Sucker Lake First Nation, an important step toward the potential development of its Monument Bay Project.

“A more expeditious model for consultations with First Nations might be available in the near future.”

Discussion: Why does the addition of more “interested parties” to the decision-making process create delays?

Huebert feared “new battles to be fought” over the Mining Association of Manitoba’s efforts “to preserve some potential exploration properties on the east side of Lake Winnipeg where the province wants portions to be recognized as a UNESCO World Heritage Site.” In view of what has happened so far on the east side, are his fears justified?

Elements of the environmental movement would be happier if there was no development in Northern Manitoba at all, in spite of the fact that most of its aboriginal inhabitants live in abject poverty and unemployment. How have the environmentalists used the stereotype of aboriginal people as the keepers of Mother Earth to promote their causes [anti-trapping, anti-roads, anti-mines, anti-development]?

How can aboriginal people fight back to ensure an economic future for their children in Northern Manitoba?

20 November 2010: “Asleep at the wheel” [Editorial, Winnipeg Free Press, A16]

The Winnipeg Free Press editorial opened with the revelation that Mines Minister Dave Chomiak was going to Toronto to speak with Vale SA officials about the closure of Thompson’s smelter and refinery. It was, in the editorial’s view, more of the “frantic to-ing and fro-ing that Mr. Chomiak and Premier Greg Selinger have been engaged in since news broke Wednesday [November 17] that Manitoba’s third largest city was going to take a very hard economic hit.”

The newspaper was of two minds on the “hand-wringing and dashing-about.” It could be that the government needed to be seen as “‘doing something’” in the “face of bad news,” but it was more likely that “the government was caught completely off guard by the news.”

Like Opposition Leader Hugh McFadyen, the editorial raised the question: “Has the government been asleep at the wheel?” It wasn’t as though there weren’t signs of a closure for some years, which the editorial listed as follows:

Regardless of who knew what when, the editorial was clear on what had to be done in response to Vale’s announcement.

Discussion: Is there enough evidence to conclude that the government was “asleep at the wheel?” If it wished to influence Vale’s decision, when should it have started the process?

Vale SA chose to build its new smelter at Long Harbour, Newfoundland. What criteria did it consider in making that decision? None of the articles explain this beyond cost effectiveness. However, the Internet can provide the interested reader with possibilities. Long Harbour has docking facilities for the world’s largest ships and ready access to markets in Europe and the eastern seaboard of the United States. Could Thompson compete with that advantage?

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