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Mining Layoffs
Hard economic times force northern mining companies to cut back
October 29, 2008
ONTARIO - Declining metal prices are forcing junior mining companies in Northern Ontario to halt production and cut hundreds of jobs in what is expected to be a series of output scalebacks in the base-metal industry.
First Nickel Inc was the first on Sunday, October 19, to put its Lockerby mine operation, located southwest of Sudbury, on care and maintenance. Low metal prices and challenging financial environments have caused 150 workers to be laid off.
FNX Mining was next, suspending commercial nickel production at its Levack Complex near Sudbury last Tuesday. However, the company said it would continue to produce 35,000 tons during the fourth quarter for metallurgical testing. Employees are not expected to be affected by this announcement, as workers will be relocated to the McCreedy West Mine, Rob’s Deposit, Podolsky Mine or development work on the Levack Footwall Deposit.
With a strong balance sheet and zero debt, FNX said it is uniquely placed to weather the current economic downturn, adding that production levels could be quickly and economically increased or decreased.
The price of nickel was down to US$8.07 per pound in September, compared to a high of US$16.89 in 2007. Similarly, zinc was selling 79 cents, down from US$1.47 last year, while copper has fallen from a peak of US$3.94 per pound in April to its current price of about US$3.17.
North American Palladium has also temporarily curtailed its Lac des Iles platinum-group metals operation in Thunder Bay. The closure is effective today leaving 350 employees out of work.
In a statement, the Toronto-based company said, “Due to the impact of recent adverse market conditions on global commodity prices, Lac des Iles is currently operating well below breakeven.”
The price of palladium plummeted from US$582 an ounce to US$180 this year as demand from the automotive industry has dropped. Palladium is a key ingredient for pollution control systems in vehicles.
Chief Executive Officer William Biggar said the company would be looking to see stabilized palladium prices in the range of $300/oz to $340/oz before it could consider reopening the mine.
However, Biggar said the temporary closure would allow the company to conserve cash, while focusing on strategic initiatives that would enhance shareholder value. He said the company would continue exploration efforts and plans to complete a feasibility study on the offset high-grade zone at the mine, an area the company believes would significantly increase the life of the operation.
The Lac des Iles mine produced 286,334 ounces of palladium last year, which accounts for about four percent of the worldwide supply of the metal. Biggar said the company has a strong balance sheet with $65 million in cash and minimal debt.
Analyst John Ing said current prices of many metals, notably nickel, are less than the cost of production. He said that trend would force companies to shut down operations at least temporarily.
Meanwhile, gold - largely considered the safe-haven during times of economic uncertainty - plunged to its lowest level in 21 months last Friday. December delivery fell $33.70 early in the day to US$681/oz on the New York Mercantile Exchange, later rising back up to trade at US$708.70.
Since its all-time trading high of US$1,033.39 back in March 2008, gold has plummeted about 30 percent.
RICKFORD WINS
Kenora riding elects first Conservative MP in 84 years
October 22, 2008
by Jennifer Patenaude /Staff Reporter
Newly elected Member of Parliament Greg Rickford is touting his victory in the Kenora riding as “mission impossible accomplished.”
The Conservative candidate beat out Liberal incumbent Roger Valley by nearly 2,000 votes in the October 14 general election and became the first Conservative MP that the riding has seen since its inception in 1924. With the exception of a four-year period from 1984 to 1988 when Sioux Lookout New Democrat John Parry took the helm, the riding has been a Liberal stronghold. Valley has held the Kenora seat since June 2004.
Rickford gained 40.31 percent of the vote with 9,335 votes. Other results are as follows: Valley 7,368 (31.82 percent), NDP candidate Tania Cameron 5,375 (23.21 percent), and Green party hopeful Jo Jo Holiday 1,078 (4.66 percent).
Campaigning door to door throughout the riding, Rickford said he was left with the impression that this was a time of change. Acknowledging that there is a lot of work to be done, he said among his top priorities are better access to health care, addressing infrastructure needs throughout the region, abolishing the gun registry, and integrating First Nation communities into the broader economy.
He also pledged his support to the Two Feathers Forest Products opportunity proposed in Red Lake and said he is looking forward to pushing forward with that project.
He congratulated his fellow candidates from the riding saying that it was a tight race and he respectfully appreciated all the hard work that was put forth by all parties.
Valley used his experience as an MP in his campaign saying he “was the only candidate with the knowledge, the experience and the dedication that the people of the Kenora riding deserve in their representative.”
He told CBC Radio that the 2008 Kenora campaign was a three-sided coin toss of which he came up short. With the current economy and mills in the region closing, as well as a highly criticized Green Shift tax initiative to explain, he said it was an uphill battle. Nevertheless he was satisfied with his campaign and said he and his volunteers did everything they could.
Newcomer Tania Cameron said she was a bit surprised by the riding’s shift from red to blue. “We’ve lost so many good forestry jobs and there has been an onslaught of mills shutting down around the riding due to the Conservative’s pact with the Canada/US lumber agreement.”
However, she said she has no regrets and fully intends to remain in politics, foremost as a band councillor in her community of Dalles First Nation. “I certainly plan to run again,” she said. “Minority government’s typically don’t have a long shelf life, so I expect we’ll be doing this again some time down the road.”
The 2008 campaign was also new to Green Party candidate Jo Jo Holiday, who didn’t let her fourth place finish get her down. She said she enjoyed the experience and the opportunity to promote the issues of the environment and the economy that are widespread in Canada. “I feel quite successful in what I accomplished, as well as all the other Green Party candidates and Leader Elizabeth May.”
She said she is a strong advocate of people’s health and lifestyle. “I walk my talk very boldly so it’s a great platform for me to stand on and raise awareness for people to make changes in their lifestyle to benefit themselves and the next generation,” Holiday said.
It is notable that, despite the Tories’ historic win in the Kenora riding, Northern Ontario as a whole turned left in this election,
garnering 7 seats for the New Democratic Party.
It remains unknown at this time how Rickford intends to work with his northern, NDP counterparts in the future.
Red Lake moves ahead with landfill operation plan
October 15, 2008
by Jennifer Patenaude / Staff Reporter
Realizing that time is of the essence to preserve the local landfill, the Municipality of Red Lake is prepared to begin a recycling operational plan.
At Red Lake’s latest meeting of council on October 7, Mayor Phil Vinet confirmed that an operational plan for the landfill would be developed in the coming months ahead with a target completion date of January 2009. The implementation process at the landfill is anticipated by July 2009, the mayor added.
A total solid waste management plan will be developed with consulting firm KGS, the local Landfill Life Advisory Committee (LLAC), the Ministry of Environment (MOE), as well as other resources, according to Vinet.
The Municipality is still waiting for a new Certificate of Approval from the MOE to increase its 4.5-hectare waste footprint. The LLAC was hoping the approval would be granted by the fall, but Debra Shushack, a councillor and member of the LLAC, said it doesn’t look like that is going to happen. However, Vinet said that “doesn’t stop us from coming up with a plan.”
He said it was due time a program suitable for Red Lake was set in place to extend the life of the waste disposal site, which, without intervention, has only five to six years of remaining storage space. The total solid waste management plan would incorporate solutions for on-site management, commodity sorting, in-house recycling, composting, e-waste, transfer stations and an introduction to hazardous waste management.
Regardless of the outcome of the MOE approval, Shushack said it was important to have a plan prepared in the event that a new landfill site would need to be developed in the future.
“The LLAC, as well as the community, needs to see that council and staff is taking an active role and that progress is being made,” said Vinet. “Every one of us has an obligation and a responsibility when it comes to protecting the environment.”
With the MOE amendment, the Municipality is hoping to gain an additional 12 years out of the current landfill by expanding the site by 100,000 cubic metres.
But Brian Anderson, Red Lake’s Chief Administrative Officer, said a number of studies and reports are mandatory with approval from the MOE before the town can move ahead with the amendment. “These are required submissions,” he said, adding that progress is currently on schedule. “But these types of things do take a lot of time. “
Anderson said a Waste Disposal Site (WDS) Study has been completed and accepted by the MOE; a WDS Inspection has been completed along with all orders and recom-mendations; a Water Monitoring Program Study has been completed but not yet approved by the MOE; and a draft WDS Operational Plan has been completed with a final version expected to be completed by the end of the month and submitted to the MOE for approval.
Since touring three landfill facilities – located in the communities of Carlton Place, Westport and Perth - while attending a municipal conference in Ottawa, Red Lake council and staff have been motivated to incorporate a number of their best practices in waste management into the Red Lake site.
Shushack acknow-ledged the improvements that have already taken place at the local landfill, including Chukuni Sanitation’s recycling program for glass and aluminum. While she is hoping more in-house recycling can be incorporated and the amount of waste being shipped out can be reduced, she said, “The landfill site is looking a lot cleaner than it used to.”
RBC analyst touts increased production at Red Lake mine
October 8, 2008
RED LAKE, ON - Following a visit to Red Lake, RBC Capital Markets analyst Michael Curran forecasted that Goldcorp’s Red Lake Gold Mine (RLGM) would increase production starting in 2009.
Reported in the National Post on Tuesday, September 30, he said, “With the completion of the new #3 shaft, coupled with the improvements to underground ventilation, the Red Lake Mine should see increased production rates in the coming quarters, from both improved access to high-grade gold zones and increased hoisting capacity from the new shaft.”
Curran, who was in town on September 25 and 26, predicted an increase in gold production from the 625,000 ounces estimated for 2008, to a sustainable level of 800,000 ounces per year in 2009. He also noted that cash costs at Red Lake could be positively impacted as the company reduces its reliance on traditional cut and fill mining and moves towards more long-hole mining in 2009.
However, Mike Lalonde, RLGM General Manager, clarified that no one at Goldcorp, either locally or corporately, issued this information to Curran.
He added that Goldcorp is still working on the 2009 budget, which will be finalized and approved at a Board of Director’s meeting in December. “Then and only then will projected production for 2009 be finalized and made public,” he stated.
Meanwhile, Curran remained optimistic about Red Lake’s exploration potential, citing promising developments from the Rahill-Bonanza project, a joint venture between Premier Gold Mines and Goldcorp; and projects from Claude Resources Inc., Rubicon Minerals Corp., and Cypress Development Corp.
IT’S A DEALGoldcorp officially acquires Gold Eagle
October 1, 2008
VANCOUVER, B.C. – Goldcorp Inc. and Gold Eagle Mines Ltd. announced that the acquisition of Gold Eagle by Goldcorp was completed on September 25, 2008.
Under the Plan of Arrangement, shareholders of Gold Eagle were entitled to receive at their election and subject to proration either C$13.60 in cash; 0.292 of a common share of Goldcorp and $0.0001 in cash; or any combination thereof, for each Gold Eagle common share held. Gold Eagle shareholders elected to receive a cash amount greater than the maximum available according to the terms of the Plan.
As a result, shareholders will receive approximately 52.7 percent of the cash amount that they elected or were deemed to have elected. In aggregate, C$725.8 million in cash and 15.6 million common shares of Goldcorp will be paid and issued to Gold Eagle shareholders. The common shares of Gold Eagle were de-listed from the Toronto Stock Exchange effective at the close of markets on Tuesday, September 30, 2008.
Goldcorp’s acquisition of Gold Eagle’s Bruce Channel discovery secures control of eight kilometres of strike length along the prolific Red Lake trend. Bruce Channel is southwest of Goldcorp’s Red Lake mine and contiguous to its Cochenour-Willans Project.
“The Gold Eagle transaction is consistent with our strategy of adding high quality gold reserves and pursuing responsible growth in the districts where we already operate,” said Kevin McArthur, Goldcorp President and Chief Executive Officer.
“Our focus now turns to maximizing Red Lake’s potential through productivity initiatives, open pit opportunities, enhanced milling alternatives and exploration success already achieved at this world-class mine.”
Macquarie Capital Markets Canada Ltd. acted as financial advisor to Goldcorp and J.P. Morgan Securities Inc. acted as strategic advisor. Cassels Brock & Blackwell LLP acted as Goldcorp’s legal counsel.
Mining Act to be revamped as final public session wraps up in Toronto
September 17, 2008
by Jennifer Patenaude / Staff Reporter
The fifth and final stop of the public consultation process to modernize Ontario’s Mining Act wrapped up on September 8 in Toronto. In addition to the province’s capital, the Ministry of Northern Development and Mines held meetings in major cities across the province including Thunder Bay, Timmins, Sudbury, and Kingston.
Phil Vinet, Mayor of Red Lake, flew to Toronto to attend the final session and said it was an active meeting with various opinions. “Being with the people in Toronto was an interesting exercise and I was happy to be a part of it,” he said. Vinet was intent on expressing that mining rules in the Golden Horseshoe do not necessarily apply in Red Lake or the North.
It was also an opportunity to reiterate with top decision makers like Michael Gravelle, Minister of Northern Development and Mines, the importance of mining tax revenue sharing. “This was an opportunity for me to verbally approach the group to express the desire for Red Lake to become a partner with Ontario for resource revenue sharing,” Vinet said. “I only hope that it will be considered under the current mining tax regime and not as an additional tax.”
The working session divided the participants – each with varying interests -into 15 tables of eight people. Elements of the review included the Mineral Tenure System and Security of Investment, Aboriginal Rights and Interests Related to Mining Development, Regulatory Processes for Exploration on Crown Land, Land Use Planning in Ontario’s Far North, and Private Rights and Interests.
Vinet maintained that “the current mining consultation system works.” He said, “Present exploration practices should be maintained as well as consultation with the affected First Nations in order to proceed in reasonable fashion and timeframes.”
He continued, “We cannot lose sight of the fact that we are a mining district and that is what has got us to where we are today. Free entry must be maintained. If separate rules have to apply for Southern Ontario, so be it, but leave Northern Ontario alone.”
According to the Finding a Balance discussion paper for the modernization of the Act, the government has divided the province into three sections: Southern Ontario, which covers the region from Windsor to Ottawa; Near North, which extends from North Bay and Sudbury to Kenora and Red Lake; and Far North, which includes the First Nation communities.
“This meeting demonstrated that a one-size rule does not fit all of Ontario,” Vinet commented. “There is no need for a blanket rule to cover the entire province.”
The public meetings came under fire recently in the press, being called nothing more than a “media show”. Vinet said that with the state of the forest industry in Northern Ontario, “we can’t afford to reinvent the wheel when it comes to the mining industry.”
In fulfilling his 2007 commitment to update the Mining Act, Premier Dalton McGuinty said the goal is to strike the right balance between conservation and development. He added that mining practices must be up-to-date and Aboriginal rights and interests must be given the appropriate consideration.
The MNDM will now collect all of the data from the five public and stakeholder sessions and use it in their deliberation in updating the Act, which it hopes to have completed by year end.
More information about the modernization of the Mining Act can be found on the MNDM website at www.mndm.gov.on.ca, along with the discussion paper which is available in English as well as three aboriginal languages.
Dryden anglers take top spot in 2008 Fall Classic
September 10, 2008
by Jennifer Patenaude / Staff Reporter
During the Labour Day weekend, the walleye-filled waters of Red Lake were overrun with competitive anglers all vying for the top prize purse and bragging rights as champions of the annual 2008 Red Lake Fall Classic.
Scott Lobreau and Mike Mackie went home with the $11,000 prize after hauling in a two-day total walleye weight of 31.44 pounds. Awards and winners were announced at a reception held at the Red Lake Legion following the second and final day of fishing on August 31.
The team had a strong third place finish on Day 1 with five walleye totaling 16.18 pounds. A Day 2 total of 15.26 positioned the Dryden anglers into top spot.
Ed Goulet and Darren Campeau held second position throughout the tournament bringing in a total weight of 31.12 pounds, only 32 ounces behind the tournament champions. They were awarded with a cash prize of $5,000 and two Humminbird locators. Tournament veterans Duane Hell and Gary Roach, who hold numerous top 10 placements in the local fishing derby, moved from sixth position on Day 1 to capture third place on Day 2 with a total weight of 31.02 pounds. The duo received a cash prize of $3,000 and a pair of MinnKota trolling motors.
Rounding out the top 10 were Maclean Ewen and David Smart with 30.66; Dan LeBlanc and Ed Szaflik with 30.18; Ken Burgess and
13-year old son Derrick with 30.12; David Sankosky and Dean Harapiak (who topped the Day 1 leaderboard) with 30.04; David Cryderman and Dan Daciw with 29.78; Rory Weibe and John Aimitage with 29.60; and Kevan Bassingthwaite and Harry Spence with 29.20.
While the tournament is hailed for its outstanding sportsmanship and friendly competitive nature, officials called out a team (names withheld) at the reception for cheating in the tournament. Tarnishing the reputation of the tournament and disappointing the organizing committee, the team used one of the oldest tricks in the book – filling the walleye with lead sinkers.
As one of the most anticipated catch and release tournaments in the region, there were 139 teams that competed in the 2008 event with a full roster and waiting list already developed for 2009.
Day 1 Big Fish went to Maclean Ewen and David Smart with a catch of 6.80 pounds and Day 2 and overall tournament Big Fish went to Fred and Crystal Mota with a 7.10-pound walleye.
Other notable mentions include Cole Badiuk, who was the recipient of the second annual Lionel Roberts Memorial Award for his volunteer efforts throughout the tournament, Andrew Johnston and Ray Wilkins who placed 51st and were the recipients of the Randy Brownlee Memorial Award and a free entry into the 2009 tournament, and Robyn Uhrina and Jesse Clayfield who were the top mixed team placing in the 17th position.
The Junior Championship Tournament, open to anglers 12 and under, resulted in a tie. Fishing from the government docks on Saturday, August 30, Justine Duncalfe pulled in a 36-ounce rock bass while Kyle Grant hooked a 36-ounce perch.
Photos from the event can be found on Page 9. Full tournament results are available online at www. redlakefallclassic.com.
Funding for Infrastructure benefits Red Lake, Ear Falls
September 3, 2008
ONTARIO - Red Lake and Ear Falls are receiving some much-needed infrastructure relief from the provincial government.
Premier Dalton McGuinty made the announcement at the Association of Municipalities of Ontario (AMO) Conference last Monday, August 25, where more than 1,600 delegates from municipalities across the province convened in Ottawa.
The Municipality of Red Lake will see $430,000, while the Township of Ear Falls will receive $110,000.
Overall, the government is investing $1.1 billion for various projects involving drinking and wastewater systems, public transit, green energy, waste management, local roads and national highways, and tourism.
Crumbling infrastructure is an issue across Northwestern Ontario. Other areas on the list to receive funding are: Dryden with $779,000, Sioux Lookout with $493,000, Atikokan with $313,000, Ignace with $136,000 and Machin with $93,000.
AMO President Doug Reycraft said the funding would help municipalities invest in much needed infrastructure repairs and capital projects, as well as create jobs in communities large and small. “The province has recognized that investing in municipalities is investing in Ontario,” he stated.
Peter Hume, AMOs incoming president, concurred saying, “Sound municipal infrastructure underpins the economic competitiveness of municipalities, the province and the nation.”
The funding represents revenue sharing between the province and municipalities in that municipalities will receive the largest portion of the 2007-2008 provincial budget surplus. Under the Investing in Ontario Act, the first $600 million of the surplus is used to pay down provincial debt and the remaining $1.1 billion is distributed to all municipalities in Ontario on a per capita basis.
AMO is a non-profit organization representing almost all of Ontario’s 445 municipal governments.
Red Lake council takes lead role in medical recruitment
August 27, 2008
by Jennifer Patenaude / Staff Reporter
The Municipality of Red Lake is facing significant challenges with a critical shortage of physicians to serve the community. This is according to Dave McLeod, a representative of the Grow Health and Welfare Committee, a sub-committee of the Mayor’s Task Force for Community Development.
During a presentation to Council on August 19, Dr. Vic Aniol, another member of the sub-committee and a senior staff member with the Red Lake Medical Associates, confirmed that several of Red Lake’s doctors have given notice of their intention to leave the community. By January, he said there would be the equivalent of 2.5 full-time physicians with the Red Lake Medical Associates, which is drastically lacking from the eight doctors the province has deemed necessary to service the area.
“We’ve always lost doctors, they come and go. It’s been hectic but it’s always been a short-term problem. We’ve made due over the years with locum doctors and with time and perseverance, we have always been able to replace doctors,” Aniol said. “We’ve never been faced with the situation we have now.”
On behalf of the Task Force, Aniol, McLeod and Annwyl Shewchuk, Professional Practice Coordinator at the Red Lake Margaret Cochenour Memorial Hospital and chair of the Grow Health and Welfare Committee, approached Council to assist in the recruitment and retention of medical health care staff to meet the community’s needs.
McLeod said a short- and long-term strategy must be developed based on partnerships, a community driven philosophy and strong, visible leadership.
Council made a unanimous decision right then and there, passing resolution no. 475-08. Based on recommendations from the Task Force sub-committee, council will be the lead agency over a five year period for medical recruitment and retention and will establish a 12-member Community Health Care Committee that will have representation from a member of the public at large, the hospital and medical group as well as
various local organizations including Council, First Nations, Chukuni Communities Development Corporation, Red Lake Chamber of Commerce, local industry, education and the Ministry of Northern Development and Mines.
In a changing marketplace with fierce competition and lucrative incentive packages, Aniol said the medical group no longer has the capacity to recruit as they have done in the past. Council has committed to hiring a full-time qualified staff member on a five-year contract, who will report to the new committee and handle the day-to-day operations of recruiting and retention.
“Mayor and Council are taking a leadership role in this inclusive community-driven initiative,” Red Lake
Mayor Phil Vinet said at the meeting. “Our efforts will be geared toward long term health sustainability. This will be a project like no other in Red Lake.”
Vinet was pleased that this escalating issue was finally brought forth to discuss collectively and received undisputed support from his councillors. “One of the barometers to measure a municipality’s state of affairs is its health care system,” he said, adding that the clock is ticking.
Councillor Donna Molloy agreed. “Time is of the essence and we can’t dawdle around in establishing a committee. The sooner this starts, the better.”
Currently, the Red Lake Medical Associates have the manpower of six full-time doctors and the Township of Ear Falls has been without a physician for some time now, Aniol said. Brian Anderson, Red Lake’s Chief Executive Officer, said it is time to start making decisions rather than just discussing the problem.
“If we don’t change with the market, we will not be successful as a business …and this is a business,” commented councillor Debra Shushack, who said she does not want to see residents consider relocating because of the state of Red Lake’s health care. “To me, this
is critical and it has to happen now.”
In fact, as far as important initiatives are concerned, Economic Development Officer Bill Greenway said, “This is the one.”
He explained that with the flurry of mining exploration currently taking place in the Red Lake area with several mines already in development, it is not unreasonable to assume that the Municipality of Red Lake’s population could double within the next five years. He said Red Lake needs more doctors now more than ever to serve the growing community and attract business as well.
“This is critical; it is the largest crisis the community will face that will affect the economic and social future of the area.”
Shewchuk said this new committee would provide a sustainable process, not only in attracting medical professionals to the area, but also in keeping them here. “We don’t just want to put a Band-Aid on the situation.”
McLeod is optimistic that the proposed structure of the new committee will provide a long-term solution to the problem. “There is a lot of potential here,” he said, acknowledging town council’s active role in the project and the benefit of a full-time staff member representing a cross section of the community.
With mayor, council and staff working hand-in-hand with the medical professionals and the new Community Health Care Committee, the wheels are firmly set in motion to tackle the challenge of medical recruitment and retention in Red Lake.
The Municipality is currently looking for interested persons to sit on the Community Health Care Committee. Interested individuals are encouraged to express their desire in writing by Tuesday, September 2 at 4:30pm
by mailing to Box 1000, Balmertown, Ontario, P0V 1C0.
Lac Seul says it is only loser in Goldcorp acquisition
August 20, 2008
by Jennifer Patenaude / Staff Reporter
Officials of the Lac Seul First Nation say they are disappointed that discussions with Gold Eagle Mines Ltd. have not yet reached the stage to produce any benefits for the community following the announcement of Goldcorp’s acquisition bid. Management at Gold Eagle say they were surprised to learn of Lac Seul’s announcement, made on Thursday, August 14.
According to Gold Eagle’s Project Manager John Whitton, the junior exploration company had been in negotiations with Lac Seul for about six months to develop a Memorandum of Understanding on its exploration activities on its Bruce Channel Discovery. Lac Seul is asserting that Gold Eagle’s exploration efforts, within the Municipality of Red Lake, are taking place on their traditional land.
Lac Seul Chief Clifford Bull said the community was open to negotiation and agreed to the ongoing exploration activities of Gold Eagle in good faith that an agreement would be forthcoming. The community’s Economic Development Officer Sam Manitowabi said, “a portion of the exploration budget would go a long way in helping the First Nation prepare and position itself to become an economic player in the exploration and mining industry.”
“Discussion had proceeded well,” Whitton said. “It was a positive experience and friendly atmosphere, as far as we were concerned.”
“With the involvement of the Ministry of Northern Development and Mines, there was a sincere desire by all parties involved to establish a meaningful working relationship to possibly develop training and job opportunities.”
However, on July 31, Goldcorp Inc. announced its plans to acquire Gold Eagle in a $1.5 billion deal that would see shareholders receive cash and/or shares, while Goldcorp would secure full control of eight kilometres of strike length in that area.
“So we get nothing,” commented Manitowabi. “Just some bills from our lawyers and expenses from our trips to negotiate with Gold Eagle Mines Ltd.”
Whitton explained that negotiations were in the early stages of development. He said the company was limited in the sense that it was only an exploration company. “We receive money specifically for exploration. We are not producing gold bars out back somewhere,” he said. But the company was looking at ways to move forward and develop a mutual relationship with Lac Seul.
Gold Eagle President Simon Lawrence said he personally contacted Chief Bull and Manitowabi to explain the mechanics of the Goldcorp acquisition and that as Gold Eagle would most likely not exist as an entity following the September 15 shareholder meeting, Lac Seul should continue negotiating with their already established Goldcorp relationship. Lawrence said he was confident that Goldcorp would continue with their ongoing consultations.
With the severe workforce shortage in the mining industry and the employment shortage in many northern communities, Whitton said it is in the best interest of mining companies and First Nations to work together in a mutual agreement. However, he said cases such as the highly publicized Kitchen-uhmaykoosib and Platinex court battle creates a bad rap for exploration companies that rely on investor and shareholder funding.
“It is frustrating,” stated Manitowabi. “We tried to be accommodating, we tried to negotiate. I just don’t know how we can have a win-win relationship in this game when the parties we are talking with - negotiating with – do this to us. It is not a good way to build trust, but I guess that is how you make money.”
“Gold Eagle shareholders ultimately make the decision on the Goldcorp deal,” Lawrence said, “so, hence, it is outside of the control of Gold Eagle management.”
Lac Seul contends that the provincial government must take a more proactive role in the consultation process. “First Nations are losing out,” Manitowabi said. “They are not involved in these transactions and are not benefiting from activities in their own backyard.”
Picture perfect weather graces 13th annual TroutFest
August 13, 2008
by Jennifer Patenaude / Staff Reporter
It was the perfect weekend for “Music in the Woods” as the sun shone brightly for the duration of the three-day Trout Forest Music Festival, held on the shores of the English River in Ear Falls from August 8th to 10th.
“It was a really great festival weekend,” commented Executive Director David Hoey. “We had a really great show Friday evening, but I would say Saturday itself really put a stamp on the Trout. The weather was fantastic and the shows were sensational. There is nothing quite like listening to the music while floating around on an inner tube on the lake.”
A fellow from Winnipeg, who is known at the Winnipeg Folk Festival for creating labyrinths, treated the audience to a floating Chinese lantern show on Saturday night, while Mother Nature put on her own presentation with a beautiful display of Northern Lights.
Now in its 13th year, the Trout is a well-recognized venue for both Canadian performers and music lovers from around the globe. According to Hoey, there were 32 separate musical acts with 77 performers in total.
Artistic Director Devin Latimer lined up musical performers from various genres for this year’s TroutFest including country and bluegrass, blues, rock, and folk.
Children’s performers, including Juno nominee Aaron Burnett, delighted the younger audiences on the Family Stage, Winnipeg blues group The Perpetrators conducted an exclusive two-day instructional workshop for developing performers, and on Friday night, Frank’s Fire Pit Jam welcomed musicians of all calibers to play along with Scott Nolan, Jo Miller and Twilight Hotel.
Three stages provided toe-tapping entertainment for a sea of spectators. Ear Falls’ Waterfront Park was packed with lawn chairs and a slew of on-site tents where Trout-goers wouldn’t miss a minute of the action.
Trout Forest Music Festival Board of Directors, staff and volunteers are to be commended on another great year of “Music in the Woods”. For more information or to view photos from this year’s event, visit www.troutfest.com.
Goldcorp moves in on Gold Eagle
$1.5 B deal will consolidate Goldcorp’s controlling position over the Red Lake mine trend
August 6, 2008
VANCOUVER - On July 31, 2008 Goldcorp announced that it had entered into an agreement to acquire all outstanding shares of Gold Eagle Mines Ltd. – a $1.5 billion bid – which, if successful, would consolidate Goldcorp’s holdings in the Red Lake area and provide great potential for the Cochenour mine through development of the Bruce Channel Gold Discovery (BCD).
“This transaction secures for Goldcorp full control of 8 kilometres of strike length in the heart of the world's richest high grade gold district,” said Kevin McArthur, Goldcorp’s President and Chief Executive Officer. “Nearly 200 drill holes have defined an impressive gold deposit at Bruce Channel, with potential for additional expansion over time. Development of this strategically important zone can now move forward with our adjoining assets as a single, comprehensive project, sharing mine infrastructure, ore processing facilities and human talent with Red Lake, thus minimizing capital and operating costs and maximizing long-term shareholder value. Red Lake mine has operated for over 50 years, and Goldcorp’s continued district consolidation efforts are designed to sustain this world-class operation for decades into the future. We are the natural partner to develop the Bruce Channel project with the geographic footprint preferred by our community.”
Under the plan of arrangement, each common share of Gold Eagle not owned by Goldcorp will be exchanged for (i) a cash payment in the amount of C$6.80 and (ii) 0.146 common shares of Goldcorp, assuming full pro-ration. Gold Eagle shareholders will have the option to elect to receive cash (on the basis of $13.60 per Gold Eagle share), shares (on the basis of 0.292 Goldcorp shares and $0.0001 per Gold Eagle share) or any combination of cash and shares, subject to pro-ration, with an aggregate maximum cash consideration of $691 million and an aggregate maximum of 14.8 million common shares of Goldcorp subject to increase on a prorated basis if Gold Eagle warrants and options are exercised prior to the effective date of the arrangement. The total consideration for 100% of the fully diluted shares of Gold Eagle would be approximately $1.5 billion. The transaction is expected to close in September, 2008.
The combination has been approved by the boards of directors of Goldcorp and Gold Eagle and will be subject, among other things, to the favourable vote of 66 2/3 percent of the Gold Eagle common shares voted at a special meeting of shareholders called to approve the transaction.
“We believe that Bruce Channel ranks among the very highest quality gold discoveries,” said Simon Lawrence, President and Chief Executive Officer of Gold Eagle Mines Ltd. “The success we have had is a testament to our Red Lake based exploration team and their endeavours have helped deliver significant value to our shareholders. Goldcorp, with their considerable infrastructure and expertise in the area, are ideally positioned to advance the project in an expedient and capital efficient manner. For our shareholders this is a very attractive transaction.”
During a Goldcorp 2nd quarter conference call on July 31st, Goldcorp executives touted the deal as an excellent chance for the company to consolidate its position in the prolific Red Lake area and to take advantage of the assets it currently owns, including the Cochenour mine property which is adjacent to the Gold Eagle claims.
General direction discussed during the conference call on Thursday included the intention of Goldcorp to move ahead with the dewatering of the Cochenour Mine to provide a platform for underground exploration of the property. Additionally, the company would also develop a new “production” shaft on the mainland side of the Bruce Channel to replace the Cochenour shaft which has “limited capabilities” rendering it unsuitable for large-scale underground development of the Cochenour mine property which will also include the mineralization under the Bruce Channel.
The company expects to invest a further $5 million into the project this year and will add the property to its budgeting process for 2009. As for expectations on development, company executives are estimating that underground exploration from the existing Cochenour shaft could begin as early as next summer and a production shaft could be developed within two years.
Even though Goldcorp’s $1.5 billion investment in Gold Eagle is being made without a resource estimate for the BCD, company officials are confident through their own modeling process that the investment will pay off in the long run as part of its overall “camp optimization plans”.
This acquisition puts Goldcorp in firm control of the district’s gold resources which will undoubtedly play a major role in company’s goals of increasing its local annual gold production to one million ounces and increasing company-wide production by 50 percent within five years.
Norseman Festival 2008
July 30, 2008
by Pamela O’Neill / Staff Reporter
The annual Norseman Floatplane Community Festival, which took place this past weekend, is something Red Lakers get the pleasure to experience every year and we all know exactly what to expect: tents for family entertainment during the day and partying at night, Norseman planes and rides, a street full of booths, and hundreds of people from all walks of life and various ages out to have fun.
So what made this festival different from previous ones? A couple additions to the 2008 schedule included a Guitar Hero Contest sponsored by Video Plus and the highly anticipated International Air Rally arrival and reception, both of which were a smashing success. (See full story on the 8th International Air Rally for details.) And something unique to us all that everyone was able to enjoy, a weekend full of pleasant weather.
Of course the festival wouldn’t have been the same without the customary Norseman Fly By, Water Bomber Display, Car Show, fireworks that light up the skies, or Mixed Slow Pitch Tournament, as these are always crowd stoppers and pleasers.
Making a come back from 2007 was the Soap Box Derby sponsored by North American Lumber, and after a year off, hypnotist Michael Leach’s return was a great way to start off the weekend on Friday evening.
As always, music could be heard both day and night throughout the streets. This year’s musical lineup included a mixture of both local and out-of-town talent such as The Service, RLMPS African Drum Choir, Small Rooms, Devon Slobozian, Jim McCann, Shyanne Hovorka, Papa Smurf, I Kill My Shadow, Jamshack, Prep Boy, Rahill, and Country Gospel.
Todd Gallagher, chair of the Norseman Festival Committee, moved to the area five years ago and has helped organize the festival for three. On Saturday, during the International Air Rally reception, Gallagher was able to take some time to comment on how he felt the weekend was unfolding.
“I think it’s been a great success so far,” said Gallagher, “but we’ll be able to tell really by the way people talk about it and how people feel after the weekend. Right now I think we just focus on kids being happy when they’re playing. If there are kids happy all day and there are a lot of people then I’d say it’s successful.”
There were certainly many smiling faces present throughout the weekend and there is always much to talk about after an event like this. Thank you to all the organizers and volunteers who were such a vital part of pulling off yet another amazing festival and making a traditional event into something new each year.
Goldcorp to launch surface drill program in Balmertown
July 16, 2008
by Jennifer Patenaude / Staff Reporter
Goldcorp Red Lake Gold Mines is planning to roll out a new surface drill program that will initially see three drill sites set up in and around Balmertown.
The company is hosting an open house on Friday, July 18, to inform residents of its upcoming plans. Chris Osiowy, Senior Exploration Geologist, confirmed that the prospective locations will include Mine Road at the Golden Learning Centre, both in front and behind the school; southeast of Detta Road along the edge of town; and the open field between Northern Visions Camp and Seventh Street.
Beginning the week of July 21 and with approximately one year scheduled for this project, Osiowy said the company is looking at having two to four drills turning in Balmertown. “We will likely drill in each location for a period of a few months and then move on to another location,” he said. Within each of theses areas, a number of holes will be drilled from different setups.
“The core from these holes will be brought to the mine site and analyzed by the geologists and samples of this core will then be sent to our assay lab to verify the gold content,” said Osiowy.
Diamond drills will be moved into the various locations throughout town which will require large equipment such as skidders and trucks. Since the surface diamond drill program will be initiated within the town site, Diamond drills will be moved into the various locations throughout town which will require large equipment such as skidders and trucks. Since the surface diamond drill program will be initiated within the town site, there are apt to be disruptions to the community, but Osiowy assured that Goldcorp is taking every measure possible to dull the noise and ensure environmental responsibility.
According to Osiowy,
sound barriers will be constructed around the drill sites to minimize noise levels and drilling will be restricted to only day shift between 7am and 7pm seven days a week. Road closures may occur for short periods of time, he said, to initially unload the drills and move them into place. Environmental priorities will include recirculating the water used from drilling and containing and removing the slimes created by the drilling.
As the first phase of this exploration program, Osiowy said additional drill sites may be required depending on the early results from the project.
“Red Lake Gold Mines will be communicating on an ongoing basis with the community about our exploration program,” he confirmed.
The open house will be held from 7am to 7 pm at the Campbell Recreation Centre where management of Red Lake Gold Mines, as well as members of the environmental and geology departments will be on hand to discuss the project and answer any questions. Osiowy said other topics of interest would include the timeline of the project, the location and number of holes to be drilled, hours of work, noise level reductions and environmental controls.
Goldcorp transfers Guatemalan manager to Red Lake
July 9, 2008
by Jennifer Patenaude / Staff Reporter
Red Lake Gold Mines has a new general manager. George R. Burns, Goldcorp’s Vice President of North American operations, named Mike Lalonde the successful candidate on June 24. This announcement was made official only one week after current mine manager Dan Gagnon revealed his intention to relocate to Sudbury.
Most recently, Lalonde has served as Mine General Manager at Goldcorp’s Marlin Mine in Guatemala. In a company memo, Burns said that the new incumbent brings many years of experience to the position and added, “Mike is familiar with the Red Lake Mine and also with other operations within the North American Goldcorp operation.”
Although Gagnon will stay on board until the end of July, Lalonde’s effective transfer date has yet to be confirmed. Burns said he is currently working with Lalonde and Tim Miller, Goldcorp’s Vice President of Central and South American operations, to authorize a suitable start date at the Red Lake facility.
“I am very confident that Mike will bring excellent skills and abilities to his new role,” Burns commented, referring to his successes and accomplishments at the Guatemalan operation.
Gagnon will be joining Vale Inco as Superintendent of Business Systems, responsible for the growth and efficiency of the company’s mines in the Sudbury basin. In the company statement, Burns acknowledged Gagnon for his contributions in Red Lake and wished him luck with his future endeavours.
Organizers and participants gear up for Woodland Arts Festival
July 2, 2008
by Jennifer Patenaude | Staff Reporter
A group of drama-focused students from Red Lake District High School are getting the opportunity of a lifetime during a local two-week artistic residency program with professional theatre group De-ba-jeh-mu-jig.
The students have been working diligently, between summer job schedules, with artist animators Joahnna Berti, Bill Shawanda and Catherine Gull on training exercises in preparation for their performances at the upcoming Woodland Arts Festival, running from July 4 to 6 and organized by the Red Lake Regional Heritage Centre.
“It has been tremendously exciting for us to work with such an enthusiastic and participatory group over the last couple of weeks,” said Berti of the students, who are a mixture of native and non-native youth with various levels of drama training. “They are extremely talented, multi-disciplinary and head and shoulders above any other group that we have worked with over the last 16 years.”
Participants include: Reggie Bacon, Alex Gagnon, Emily Hinton, Allindsay Kakegumick, Isaac Kakegamic, Courtney Mamakeesic, Kate Polle, Davin Tio, Liz Mochrie, and Aaron Weaver.
They will be performing a variety of theatre performances over the course of the Festival weekend. Focusing on the life of renowned woodland artist Norval Morrisseau and his time in the Red Lake area and the support he received from local residents, the students will animate bits and pieces of his early career, as well as be incorporated into De-ba-jeh-mu-jig’s main stage performance on July 5 at the Red Lake Legion taking on small roles or participating in crowd scenes.
De-ba-jeh-mu-jig is asking everyone that attends the showcase to be a part of the action by dressing up in garb from the late 1960s and early 1970s.
Heritage Centre curator Michele Alderton is thrilled with the enthusiasm and talent that De-ba-jeh-mu-jig brings to the Festival and is grateful for the opportunity they are providing this group of youth.
“I think we are going to see something really neat happen from this collaboration,” she said.
Organizers of the Festival, the first of its kind in Ontario that will tribute Morrisseau as well as the Triple K Co-Op and Woodland artists, are busy with the final stages of preparation. Advance weekend passes are available from the Heritage Centre that will include activities such as a historic walking tour of Cochenour with guides Linda Lundstrom, former local resident and Canadian fashion celebrity, and Phil Vinet, Mayor of Red Lake, as well as a ferry ride to McKenzie Island where Morrisseau created some of his most memorable paintings; the Anishinaabe Art Fair featuring prints and silk screens by Triple K artists, Carl Ray and other Woodland artists and quilts by Alice Olsen Williams; and the Dinner and Theatrical presentation by De-ba-jeh-mu-jig.
The Woodland Art Exhibition presented at the Heritage Centre will feature approximately 25 original Morrisseau paintings, including one piece on leather – all on loan from local residents – as well as 15 pieces by Triple K artists.
The Festival will welcome 24 special guests from the arts community including artists, exhibitors, collectors, historians and gallery owners. Morrisseau’s family will also be traveling to Red Lake for the Festival. A series of 14 artists will be participating in the Art Fair and presenting workshops.
It is poised to be an event that will fill the void on Morrisseau’s life from 1959 to the mid 1970s, a piece of history that is relatively unknown to many in the art world. “We are delighted to report that the response to this event has been very positive and we are expecting an excellent turnout,” Alderton said.
For more information or presenter biographies, visit www.redlakemuseum.com.
Bittersweet victory for Trout Lake trapper
June 25, 2008
by Jennifer Patenaude | Staff Reporter
Kaaren Olsen Dannenmann is celebrating a bittersweet victory in her court case with the Ministry of Natural Resources (MNR).
Last year Dannenmann and her husband Phil were found guilty of building a 24’ x 24’ cabin on her traditional homeland on the shores of Trout Lake without a work permit. Dannenmann represented herself in Red Lake Court during a three-day trial in June 2007, basing her defense on the Ipperwash Inquiry Report, which was released five days prior to her case.
One year later and one day after the Prime Minister’s residential school apology, the Anishinaape trapper, educator and activist, was cleared of the charges and allowed to maintain the existing cabins.
“Our purpose in this court case was to keep the cabins and the timing was perfect in everything,” she commented. “That my trial came only days after the release of the Ipperwash Inquiry Report was a gift.
That Phil’s trial and my sentencing came only days after the apology of the Prime Minister was a gift. It is all interconnected.”
She said the MNR has been making valiant efforts to work with the people of Trout Lake and to understand their culture and values, referring to the Ministry’s Mission Statement in the Resource Management Plan of the Trout Lake Conservation Reserve, which states: “…and to preserve and protect the history and culture of the NamekosipiiwAnishinaapek (the Trout Lake Ojibwe).”
“I think we are just beginning to see government working in a more cooperative way with Anishinaapek. This is something to celebrate.”
During her trial, Dannenmann explained how her remote community was dismembered by the development of the Red Lake Gold Rush and the tourist operations, the assimilation of children to residential schools, and the loss of language, culture and skills as a result. The particular cabin on Anton Beach is the site for community gatherings and education and training programs. “Re-membering has started to happen,” she confirmed. “As we return to our homeland, year after year, learning our history and skills and our rights and responsibilities, we are reclaiming our rightful place in Trout Lake.”
However, as part of her sentencing, Justice of the Peace Robert Ponton fined Dannenmann court costs of almost $7,500.
Some of Dannenmann’s friends have banded together to raise funds to help with the court costs and to support her opportunity to retain her heritage and culture. An online group has been initiated on Facebook, “Do not let injustice prevail in Red Lake, Ontario” and a trust fund will be set up to gather donations.
“I feel overwhelmed and so humbled by the support of people all across the country,” Dannenmann commented. She said her inbox has been overflowing since the news of the verdict came out and that money is already starting to trickle in. “I am extremely grateful.”
New ESA to “cripple” NW Ontario
June 18, 2008
by Jennifer Patenaude & Pamela O’Neill | Staff Reporters
The Ontario Forestry Coalition (OFC) has been traveling the region gaining support from “endangered communities” against the implementation of the new Endangered Species Act (ESA), which the provincial government is set to pass on June 30.
Affected parties including the forest industry, the mining sector and tourism, have stated that should the Act be legislated as it reads today, it would “cripple” the way of life for everyone in Northwestern Ontario.
Representatives of the OFC, including Thunder Bay Mayor Lynn Peterson and OFC President and Chief Executive Officer Jamie Lim, gave a presentation in Ear Falls last Tuesday as part of its Endangered Communities Tour. Presenting to a group of about twenty people, they wanted the community to “get engaged” with one of the biggest issues facing our region.
At the meeting, Larry Herbert, owner of Esker Logging, said he has already been forced to lay off 14 employees. Although six of those people have been called back in the meantime, Herbert said it is only a small example of how the community could be affected.
“230,000 Ontario families rely on forestry for their livelihood,” Lim said. “They shouldn’t be used as an experiment.” Johnson said.
“It is really hard to change legislation once it is passed. We may be small, but collectively, maybe we will be heard and will have a fighting chance.”
Cameron said the legislation is being influenced by organizations in Southern Ontario and pointed to environmental group the Ivey Foundation, as responsible for gaining the Minister’s ear right before last minute changes were introduced in the regulation.
Johnson agreed saying the group has “the money, means, and brains to lobby the provincial government.”
“The Ivey Foundation has the right to have their say, but not to completely get their own way,” Johnson added.
Cameron said typically stakeholder groups are initiated before changes in legislation such as this take place, but he reprimanded the implementation of the new Act, saying only environmentalists residing in the southern portion of the province had their say in this decision. “Basically, we’ve been taken to the cleaners by
money and population.”
He went on to say that the implementation of this new Act, which has been hailed as having the toughest regulations in the country, will force the industry to be restricted by red tape and cost the organizations time and money that it can ill afford.
“The [forestry] industry has been crippled over the last few years and this Act has the potential to take it down to its final death.” he said.
According to Cameron, regional forest management practices have proven effective and efficient for species at risk, including the
Bald Eagle, which has been down-listed from endangered to special concern status in Northern Ontario, and Woodland Caribou, which has expanded its range further south and increased its lines with no evidence of decline.
Attending members of the meetings were asked to sign a letter asking the Premier to establish a long-term regulation of the ESA that recognizes that the primary objectives of the ESA are met through the Crown Forest Sustainability Act and its required Forest Management Plans. The signatures were faxed to Queen’s Park on Monday.
Ear Falls Generating Station slated for fall completion
June 4, 2008
by Jennifer Patenaude | Staff Reporter
Construction has been ongoing at the Ear Falls Generating Station since January 2006. Although it was originally reported that the 12.5-megawatt Expansion Project would be completed by fall of 2007, the company ran into production snags that delayed construction and in-service dates were continually pushed back.
However, officials with Ontario Power Generation (OPG) confirmed that construction is progressing at the site and anticipated that the station would be up and running by the fall.
“OPG is pleased that the project is nearing completion and we are looking forward to bringing the new generating unit on line,” said Art Rob, Project Manager.
Roma Kopechanski, Northwest Plant Group Public Affairs Advisor for OPG, confirmed that the intake structure is nearing completion. Currently, all major concrete work is complete and drilling has begun in preparation for the removal of the cofferdam at the intake at the south side of the highway (downstream). “As part of this, a final series of blasting will be taking place through the month of June,” she said, resulting in some highway traffic interruptions surrounding the project site.
The new hydroelectric generating station, being constructed adjacent to the existing Ear Falls Generating Station on Highway 105, consists of a water intake and short tunnel under the highway to bring water to the generating unit, which is installed in its own powerhouse.
According to Kopechanski, the construction of the powerhouse building is substantially complete and although there was speculation in and around the community of problems with the installation of the turbine generator she confirmed that assembly is proceeding.
While the company said the existing facility could not utilize the available water resources at the site, it stated that, “the new unit will result in optimal use of the available water and will not alter the current water flows out of Lac Seul or the English River.” The water will leave the new unit and flow back into the river from a short channel called the tailrace.
The transformer has been installed in the switchyard and landscaping work has also begun in the construction yard beside the powerhouse.
“OPG would like to thank the local community for their patience and cooperation during the construction phase,” Kopechanski added.
Work at the site was delayed initially due to negotiations with Lac Seul First Nation regarding outstanding issues dating back to the original flooding of the Lac Seul Reservoir. The company also had problems with its contracting crew last year when Leo Alarie and Sons walked off the job site in April 2007 leaving the company to enlist a replacement contractor to continue work.
While the average household in Ontario uses about 10,000 kilowatt hours of electricity per year, once completed, the new Ear Falls Generating Site will be capable of producing approximately 52 million kilowatt hours of clean, reliable hydroelectricity per year, which is enough to meet the yearly demands of about 4,000 homes.
Mining municipalities want their fair share - Communities get ready to lobby government
May 28, 2008
Jennifer Patenaude | Staff Reporter
As part of the annual conference of the Federation of Northern Ontario Municipalities (FONOM), Red Lake Mayor Phil Vinet met with his fellow colleagues Mayor John Rodriguez, City of Greater Sudbury, and Mayor Tom Laughren, City of Timmins.
In response to A Refined Argument, a recent report commissioned by the City of Greater Sudbury, mining municipalities are planning to lobby the provincial and federal government to access a larger piece of the mining taxation pie.
As it stands now, the government has gained billions of dollars in tax revenues generated by the extraction of non-renewable resources from every mining company in the province. The Federal government collects Federal Corporate Income Tax at a rate of 22.17 percent while the Province collects Ontario Corporate Income Tax at 12 percent, as well as Ontario Mining Tax at an additional ten percent. Municipalities, however, are entitled to collect property tax, but since only the surface operations of mining companies are eligible for property taxation purposes, the municipalities have fallen short.
During the conference, held in Sault Ste. Marie from May 14 to 16, the trio met to break down the in-depth report, that although was prepared for the City of Greater Sudbury, could very well be a nameless report, applicable to any mining municipality in the province, according to Vinet.
After reviewing some of the historical background of the issues, including mining municipalities in Ontario, property taxation with respect to mining companies, municipal contributions to the mining industry, and the overwhelming percentage of wealth the federal and provincial governments have gained due to the taxation of mining companies, the leaders of the three largest mining municipalities in the province began to break down the extensive 70-page report.
“After our discussion,” Vinet said, “it was clear that we have to invite the province of Ontario to enter into negotiations to establish some type of resource revenue sharing framework that could give us some revenue certainty.”
“Red Lake council has been working hard on all provincial lobbying efforts,” Vinet commented, adding that this effort would be no exception.
He noted that the mining industry’s strong economic growth contributes significantly to Ontario’s economy. “As mining municipalities, all we are asking for is a relatively small percentage of the revenue that is generated by mining taxation in order to benefit from the wealth that lies under our feet in the North,” Vinet said.
Vinet, Rodriguez and Laughren discussed how their respective municipalities have not accessed their full assessment base due to provincial tax regimes. As a result, municipal infrastructure costs are rising, but government grants to date have not been sufficient.
“The mining industry is expanding,” Vinet said. “Here’s a chance for mining municipalities to reach their full potential. By doing that, we can lay the foundation to attract new business to the area.”
The City of Greater Sudbury brought together leaders from the community to create an Advisory Panel on Municipal Mining Revenues, chaired by Jose Blanco, that has been meeting monthly since March 2007. The committee, as well as interested municipal partners, is set to proceed with the negotiations and will be seeking the support of the Mining Association of Ontario and the Association of Mining Municipalities of Ontario, of which Vinet is a director for Northwestern Ontario.
“What mining municipalities really need, is a good partner to grow the Northern economy, which would in turn facilitate overall provincial wealth,” Vinet said in reference to the impending partnership the Advisory Panel is anticipating with the provincial and federal government.
BIG BIKE makes BIG BUCKS in Red Lake
May 21, 2008
by Jennifer Patenaude |Staff Reporter
Unseasonably cool temperatures and damp conditions didn’t hinder the spirits of nearly 150 enthusiastic local fundraisers as they peddled down Howey Street on the infamous “Big Bike” in support of the Heart and Stroke Foundation of Canada. Taking place on the morning of May 13, five teams from various organizations raised nearly $12,000.
Each team peddled in unison to make the two-kilometre trip down Howey Street from the Government docks to the Red Lake Daycare Centre and back again.
“There is an incredible amount of team spirit in Red Lake,” commented Cindy Engstrom, area manager with the Heart and Stroke Foundation in Dryden.
Making its inaugural visit last year, 2008 marks the second year that the Big Bike has stopped in Red Lake, an event that never fails to draw a crowd. And it’s no wonder - the massive 30-seat contraption is roughly the size of a school bus measuring in at approximately eight feet wide and thirty feet long and weighing an estimated two thousand pounds.
Teams this year included: members from the Ministry of Natural Resources that called themselves Svend’s Spinners; representatives from CIBC, Scotiabank and Sobeys teamed up as Hanging Loose for Heart and Stroke; the Red Lake Gold Mines dubbed themselves Goldcorp’s Golden Group, teachers from Red Lake District High School formed the Rhapsody Rams; and representatives from the Northwestern Health Unit, nurses from Red Lake Margaret Cochenour Memorial Hospital and officers from the Ontario Provincial Police banded together as Guns and Rashes.
Kudos to Svend’s Spinners, named in honour of a former Red Lake fire fighter who died young from a heart condition. The team was named the top contributor in Red Lake with $3,391 in donations collected. Engstrom said over the last two years, Red Lake has raised over $25,000 for vital heart and stroke research and education.
Although there have been incredible medical advances in heart and stroke research in recent years, Engstrom confirmed that cardiovascular diseases continue to be one of the leading causes of death in Canada - responsible for one in three Canadian deaths. Money collected from the Big Bike events across the country go toward eliminating heart disease and stroke, medical advances, health education and local programs for the organization.
Engstrom acknowledged Rob Monk (OPP), Barb Menard (Red Lake Hospital) and Carolynne Gula (Northwestern Health Unit) for their assistance with the challenging task of transporting the Big Bike.
The Big Bike also made stops in Ignace and Dryden last week with the Northwest Region tallying a total of $31,000. Between April and September 2008, the Big Bike will be making its way through more than 200 communities across nine provinces.
Municipality delivers “reasonable” budget
May 14, 2008
by Jennifer Patenaude | Staff Reporter
The Municipality of Red Lake adopted a $12.8 million budget at its regular meeting of council on Monday, May 5.
The proposed 2008 expenditures translate into a three percent rise for municipal property taxpayers, which treasurer Mike Morton referred to as “a reasonable levy increase” in his presentation to council.
“This is the most exciting capital budget that I’ve seen in ten years, ” stated Brian Anderson, Red Lake’s Chief Administrative Officer, referring to the $5.3 million in allocated capital spending.
Anderson outlined a number of infrastructure improvements and equipment upgrades including the $2 million being spent on water and sewer projects in the area - Young Street, Dickenson Road and Buffalo; the nearly $400,000 on road improvements for McManus, Bennett, and Chelsea Drive to Dupont Drive; and $160,000 for a new road grader.
Thanks in part to the $275,000 surplus from the 2007 budget, other major expenditures include the Red Lake Day Care relocation, the installation of water metres, a new columbarium, new playground equipment for Laverty Park, enhancements to the Rahill Tennis Court two fire trucks and heavy equipment, as well as engineering costs to begin the Highway 105 Commercial Project, the Blende Street extension and the Nungesser Road Industrial Park.
“We are delivering a budget to our taxpayers that is reasonable considering the constraints that Red Lake has,” commented Vinet to his council, referring to the low density and low population that is currently holding the area back. “Simply put, we need more residents living in Red Lake, which will increase our assessment base.”
Red Lake’s Mayor said the 2008 budget “is ratepayer driven and is in the ballpark with levy increases across the rest of Ontario.”
In fact, as far as tax increases are concerned, Red Lake came in under or at par with most regional jurisdictions including Kenora at 5.9 percent and Fort Frances at 3.2 percent. Meanwhile, Dryden announced a 2.3 percent increase while Ignace recently sent its budget back to the drawing board, hoping to abolish its proposed two percent increase completely.
In addition to the $110 more that residents will pay per year for water and sewer services, officially announced on March 18, 2008, residential taxpayers will pay approximately $64 per year in additional property tax (based on a $100,000 assessment).
However, Vinet maintains that Red Lake’s latest budget is definite “value for your buck.”
Councilor Debra Shushack is pleased that the residential tax levy remained at a minimum and acknowledged the capital expenditures, such as the repaving of roads, that taxpayers have been asking for.
“I am really excited that we are spending money on projects that the residents and taxpayers want,” added councilor Donna Molloy.
During the meeting, held in council chambers, budget committee chair councilor Brian Larson commended the staff, particularly Morton, who prepared Red Lake’s latest financial plan.
Further information regarding the 2008 Budget can be obtained from the Municipal office in Balmertown or by calling 807-735-2096.
Red Lake’s mine rescue team dominates regional competition
May 14, 2008
by Jennifer Patenaude
The nine members of the local Mine Rescue team have returned home from the regional competition victorious. The team from Red Lake Gold Mines went head to head with two teams from the Musselwhite Mine during the annual competition, which was held in Thunder Bay on May 8 and 9.
“All teams were outstanding in their performance and it was good to see the caliber of training that all the teams put into the event,” said Safety and Training Coordinator Loye Halteman.
An underground mining scenario was set up at the Neebing Memorial Arena on Thursday where each team was sent in to locate three missing workers and contend with an underground fire. Taking approximately three hours to complete the extensive physical exercise, teams located the missing workers, extinguished the blaze using foam and built barricades in order to clean out contaminated air.
On Friday, each team member was tested on their knowledge during a 20 question written exam, a critical component that was added to their overall team score. Halteman tipped his hat to team captain Dave Hay for his perfect score on the multiple-choice questionnaire.
Approximately 25 judges were on hand to critique each team’s timing, their procedure during the problem, and their accuracy.
A banquet ceremony took place on Friday evening where the Red Lake team was awarded the district trophy.
The local team is now enjoying a few days of well-deserved rest and relaxation before resuming their extensive training schedule for the provincial competition, set for the first week in June in Sudbury. View photos of this event
Red Lake contends it is not receiving fair share of mining tax
May 4, 2008
by Jennifer Patenaude
Red Lake taxpayers look around the community and see their roads crumbling, water and sewer pipes in desperate need of repair, and an aging medical facility among other things. However, Red Lake is home to what is referred to as the wealthiest gold mine in the world, so why does the community not reflect that prosperity?
This seems to be the plight of any mining municipality in Ontario thanks to the current tax regime that generates an outrageous amount of revenue for the Federal and Provincial governments, while only leaving a fraction for Municipalities – the place where the wealth is extracted.
This is why the Municipality of Red Lake is joining forces with the City of Greater Sudbury, along with the City of Timmins and other Northern Ontario mining jurisdictions, to negotiate with the Provincial government to establish a resource revenue-sharing framework that would ensure a steady and sustainable revenue stream for the municipalities within the boundaries of which these mines operate.
The City of Greater Sudbury released a comprehensive report back in February entitled A Refined Argument that deals with the Ontario mining industry and taxation.
From each of Ontario’s mining companies, the Federal government collects Federal Corporate Income Tax at a rate of 22.17 percent; while the Province collects Ontario Corporate Income Tax at 12 percent, as well as Ontario Mining Tax at an additional ten percent. Municipalities, however, are entitled to collect property tax, but since only the surface operations of mining companies are eligible for property taxation purposes, the municipalities have fallen short while the Federal and Provincial governments have gained billions of dollars in tax revenues generated by the extraction of non-renewable resources from these communities
And Red Lake Mayor Phil Vinet said this concept is “flat out wrong.”
He echoed statements from the report saying there is a striking disparity between the growths in tax revenue flowing to senior levels of government relative to that of the municipalities.
According to the report, from the time period between 2001 and 2005, the Federal government saw an increase in mining tax revenue that ranged from $118 million to $209 million, a growth of 78 percent. Similarly, Provincial taxation revenue grew a whopping 110 percent with an increase of $85 million to $179 million over that same five-year period.
“This is in sharp contrast to the gradual, yet steady, decline in property tax revenue received by Municipalities from the mining industry,” the report stated. Municipalities received almost $40 million from mining taxation in 2001, which dropped down to $38 million by 2005. “While companies, employees and other levels of government enjoy great prosperity thanks to this recent and very welcome boom [in the mining sector], the Municipality sees the mining contribution to municipal taxes erode each year,” the report went on to say.
The City of Greater Sudbury brought together leaders from the community to create an Advisory Panel on Municipal Mining Revenues, chaired by Jose Blanco, that has been meeting monthly since March 2007. Vinet has been working closely with the mayors of both Sudbury and Timmins to support their efforts and to develop a plan for resource revenue sharing with the Province and suspects that each mining municipality will enter into their own discussions with provincial leaders to address this issue. The Association of Mining Municipalities of Ontario, which Vinet is a director of for Northwestern Ontario, will also take a lead role.
In Red Lake, the Mayor estimated that it would take upwards of $35 million in capital spending to top up the level of the area’s infrastructure, which is at least a ten year financing program, he said. “That figure is a mere fraction of what the mining companies are paying in provincial mining taxation,” Vinet commented.
Many other communities across the country have worked with provincial governments in the past to share in natural resource revenues. For instance, the Peace River Regional District and the Province of British Columbia developed a memorandum of understanding for compensation to tax revenue from the oil and gas industry; this is also the case with communities in Northern Quebec and Newfoundland.
“Our Municipality is currently experiencing strong mining growth, which is going to be around for some time to come. It is extremely important that we increase our assessment base through residential and commercial growth, and it is just as important we get our fair share of mining tax revenue to meet our community needs,” Vinet said.
He added that Council is committed to increasing residential and commercial assessment to address the community’s capital financing needs. “But that alone will not sustain Red Lake’s infrastructure requirements,” he noted. “ We must pursue every revenue stream possible”
However, he is not pointing fingers at the mining companies in the district. In fact, he said, “In the past, it has been generally well known that the mine shares in our efforts in provincial revenue sharing. They understand that a well-serviced community increases the quality of life of the community and can assist in attracting and maintaining a quality workforce.”
In the spirit of cooperation, the Report noted that it was time for the Municipalities and the Province to work out a mutual benefit and Vinet added that with templates like the Aggregate Resources Act, this is an ideal time to enter into negotiations with Provincial leaders to develop a full-time partnership.
“In Red Lake we have absolutely no desire for any mining company to pay more mining taxes than they currently are required. Our contention is that every single mining job is valued and we would not want to lose one at the expense of additional taxation rates,” Vinet said. “What we are saying is clear: we want more of the mining tax and royalties that are paid to other levels of government to remain here in Red Lake: right where they belong, right where they are earned on the backs of Red Lakers.”
Domtar Layoffs at Ear Falls
April 7, 2008
by Jennifer Patenaude
Staff Reporter
Laying to rest rumours that have surfaced regarding a massive layoff and an impending closure at the Ear Falls Domtar Sawmill, the company’s Public Affairs Manager Bonny Skene confirmed that Domtar has adjusted its shift schedule at the Ear Falls facility in order to decrease costs.
“As everybody is aware, the current market for lumber, coupled with the higher Canadian dollar, is posing extreme challenges for the forest industry across the country,” she said. “No stone has been left unturned when it comes to improving efficiency and decreasing costs at our operations.”
While there was talk of employee layoffs reaching as high as 45 people and a possible closure of the mill by summer, Skene said 25 of the approximately 135 employees have been temporarily laid off as a result of the decrease in production.
She said the company decided to reduce the shift schedule to eight hours, down from ten, which she said also opened a larger window for maintenance.
Production per hour was reported to be up and despite the downturns in the industry, Skene said Ear Falls has been fortunate to remain one of the few sawmills still in operation across the area.
Red Lake lands $750,000 grant for water main repair
April 7, 2008
by Jennifer Patenaude
Staff Reporter
The Municipality of Red Lake has learned it is the recipient of a $750,000 provincial grant under the Municipal Infrastructure Investment Initiative.
Minister of Public Infrastructure Renewal David Caplan delivered the good news on Friday noting that Red Lake was one of 462 applications received from municipalities across the province where the total project value of all applications was more than $1 billion.
Red Lake Mayor Phil Vinet explained that the investment would be dedicated to a water and sewer renewal project on Dickenson Road in Balmertown, which would extend from Fifth Street to Mine Road and include both underground pipe work and surface improvements.
While he said the Municipality has made several previous attempts to obtain funding for water and sewer projects, the mayor said council’s efforts had been unsuccessful until now.
“I am very proud of the work council and staff has accomplished in lobbying the provincial government of the area’s needs. We have finally hit pay dirt and I want to thank them for their work. I am hoping this is the beginning of continued progression of infrastructure renewal in the Red Lake area,” Vinet said.
The McGuinty government announced its commitment to supporting municipal infrastructure in its 2007 economic outlook and fiscal review.
MNDM Minister Gravelle visits Red Lake
March 19, 2008
by Jennifer Patenaude
Staff Reporter
Making headway on his goal of visiting as many Northern communities as possible during his term as Minister of Northern Development and Mines, Michael Gravelle stopped in Red Lake last week and enjoyed a whirlwind tour of the many developments in the area.
Gravelle arrived in the area on Monday, March 10, and visited the First Nation communities of Pikangikum, Bearskin Lake and Muskrat Dam. Representing the Ministry devoted to northern affairs and the mineral industry, Gravelle said communicating and consulting with First Nations is a role he takes very seriously.
On Tuesday, Municipality of Red Lake council and staff hosted the Minister and his staff.
Mayor Phil Vinet said, “Red Lake has been identified as an area with positive economic potential, so it was important that the Minister see first hand the activity in Red Lake.”
“These are exciting times in Red Lake,” Gravelle commented. “There are many opportunities, particularly on the mineral sector side of things, and the community has a strong and credible reputation in that field.”
The Minister was taken on a tour of the Gold Eagle Mine shaft site on McKenzie Island, as well as shown the active programs in place by the many diamond drill rigs set up on the lake.
Other developments highlighted on the Minister’s tour of Red Lake was the reconstruction of the Government Building on Howey Street, the proposed location of the Highway Commercial Property, and the Cochenour Water Treatment Plant that Vinet touted as the most modern treatment facility in the province. He also delivered due props to Northern Waterworks, the locally based operator. He told the Minister that, “Northern Waterworks delivers excellent service with excellent results and we are proud to have them as our operator.”
The group also stopped by the Nungesser Road Two Feathers Forest Products site, which will house the new laminated post and beam manufacturing facility, spearheaded by Finland’s Wood Tech Group, as well as the adjacent Red Lake industrial park.
In light of the hardships currently facing the forest industry, Gravelle noted this development as an important value-added forestry operation that is imperative to the current diversified economy.
The Red Lake airport was another stop on the tour and the Minister was given details on the much-needed reconstruction of the airport terminal. Airport traffic has increased ten fold since the current building was set up, according to Vinet, who also noted that the new facility would be a larger, state-of-the-art terminal.
The Minister was also made aware of the community’s current struggles and hardships, in particular the infrastructure requirements in Balmertown. “It was important to confirm to the Minister that this situation needs addressing this year.” As well, the nearly overflowing landfill site was brought to Gravelle’s attention. Although concerned about the longevity of the site, Vinet remained positive that the situation could be rectified. “I am confidant that with the Municipal waste diversion program, along with assistance from the Ministry of the Environment, we can expand the life of the landfill by many years.”
Gravelle said proper infrastructure was essential for a community to move forward and grow. “Our number one priority is to support communities,” he said, adding that the Northern Ontario Heritage Fund was recently increased to $100 million, up from $60 million.
The final stop on the tour was the local MNDM site housed within the Red Lake Regional Heritage Centre, which Gravelle paid great tribute to. While there, he had the opportunity to meet with curator Michele Alderton and assistant curator Sara Petko and learned of their many ongoing projects, including the upcoming Woodland Arts Festival in the summer.
In the end, councilors thanked Gravelle f | 