And a few more...
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The Ottawa Citizen
Wed 11 Feb 1998
Business Section
D4
Interest group wants one review of Voisey's Bay project
VANCOUVER -- There should be only one environmental review of the Voisey's Bay nickel development in Newfoundland, a lawyer for a public interest group said yesterday.
The federal and Newfoundland governments plan separate hearings into the mining and smelting aspects of the mine.
"The strategy of splitting the project reduces the opportunity for a comprehensive public review," Rodney Northey told Justice Andrew MacKay in Federal Court.
"The Voisey's Bay nickel development should be treated as one integrated nickel project under the federal Environmental Assessment Act."
Mr. Northey, acting for the Citizen's Mining Council of St. John's, Nfld., said a four-party memorandum of understanding between the federal and Newfoundland governments, the Innu and Inuit calls for the mining and milling aspects of Voisey's Bay to be reviewed by a panel of independent experts. But the smelting and refining aspects of the project will only be reviewed under Newfoundland environmental legislation by provincial government bureaucrats.
"To date, there is no panel review and no independent experts," said Mr. Northey. "We are trying to get the smelter included in the same project as the mine and mill."
In May 1996, Inco Ltd. of Toronto paid $4.6 billion for Diamond Fields Resources, the Vancouver-based junior that discovered the rich Voisey's Bay deposit in Labrador in 1994.
Inco wants to build a nickel smelter at Argentia on the west coast of the Avalon Peninsula.
Mining leases in Newfoundland require milling, smelting and refining be done in the province.
Voisey's Bay will supply about 13 per cent of the world's nickel market when developed, according to Mr. Northey. "It's a Canadian project with an enormous national and international profile."
He said most of the members of the Citizens' Mining Council live on the same peninsula as the proposed smelter. "St. John's is downwind of the smelter. The prevailing wind (from Argentia) blows northeasterly toward St. John's."
In addition, he said, "Smelters are a significant source of acid rain."
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The Vancouver Sun
Wed 11 Feb 1998
Business Section
E4
Rod Nutt, Sun Business Reporter
Hearing split lessens Voisey's enviro concerns, lawyer argues.
A decision by the federal and Newfoundland governments to hold separate hearings into the mining and smelting aspects of the Voisey's Bay nickel mine "diminishes the level of concern" over the environmental impact of the development, a lawyer for a public interest group argued Tuesday.
"The strategy of splitting the project reduces the opportunity for a comprehensive public review," Rodney Northey told Justice Andrew MacKay in Federal Court.
"The Voisey's Bay nickel development should be treated as one integrated nickel project under the federal Environmental Assessment Act."
Northey -- acting for the Citizen's Mining Council of St. John's, Nfld. -- said a four-party memorandum of understanding between the federal and Newfoundland governments, the Innu and Inuit calls for the mining and milling aspects of Voisey's Bay to be reviewed by a panel of independent experts.
The smelting and refining aspects of the project will only be reviewed under Newfoundland environmental legislation by provincial bureaucrats.
"To date, there is no panel review and no independent experts," said Northey.
"We are trying to get the smelter included in the same project as the mine and mill."
In May 1996, Inco of Toronto paid $4.6 billion for Diamond Fields Resources, the Vancouver-based junior that discovered the rich Voisey's Bay deposit in Labrador in 1994.
Inco wants to build a nickel smelter at Argentia on the west coast of the Avalon Peninsula.
Mining leases in Newfoundland require milling, smelting and refining be done in the province.
Voisey's Bay will supply about 13 per cent of the world's nickel market when developed, according to Northey.
"It's a Canadian project with an enormous national and international profile."
He said most of the members of the Citizens' Mining Council live on the same peninsular as the proposed smelter.
"St. John's is downwind of the smelter," Northery said.
"The prevailing wind [from Argentia] blows northeasterly toward St. John's."
In addition, he said the entire peninsular and its 8,000 water bodies is sensitive to acid rain.
"Smelters are a significant source of acid rain," he said.
A decision by the court on the Citizens' Mining Council request for a single public review on environmental impacts isn't expected for several months.
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The Toronto Star
Wed 11 Feb 1998
Metro Edition
D5
Single review sought for Voisey's Bay project
VANCOUVER (CP) - The Voisey's Bay nickel development in Newfoundland should get only one environmental review, a lawyer for a public interest group says.
Ottawa and Newfoundland plan separate hearings into the mining and smelting aspects of the mine.
"The strategy of splitting the project reduces the opportunity for a comprehensive public review," Rodney Northey told Justice Andrew MacKay in Federal Court yesterday.
"The Voisey's Bay nickel development should be treated as one integrated nickel project under the federal Environmental Assessment Act."
Northey, acting for the Citizen's Mining Council of St. John's, Nfld., said a four-party memorandum of understanding among the federal and Newfoundland governments, the Innu and Inuit calls for the mining and milling aspects of Voisey's Bay to be reviewed by a panel of independent experts. But the smelting and refining aspects of the project will be reviewed only under Newfoundland environmental legislation by provincial government bureaucrats.
"To date, there is no panel review and no independent experts," said Northey. "We are trying to get the smelter included in the same project as the mine and mill."
In May, 1996, Inco Ltd. of Toronto paid $4.6 billion for Diamond Fields Resources Inc., the Vancouver-based junior that discovered the rich Voisey's Bay deposit in Labrador in 1994.
A decision on the council's request for a single public review on the environmental impacts of Voisey's Bay isn't expected for several months.
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GLOBE AND MAIL
FEB.12,1998
B15
** Nickel's price rallies, partly due to alleged scam **
** But Inco's plan to maintain production could kill the party **
BY AARON LUCCHETTI and NORIHIKO SHIROUZU
The Wall Street Journal
The nickel market has suddenly landed on investors' radar screens. For the past two weeks, long-battered nickel prices have staged an impressive recovery, albeit not of the magnitude of the silver market's recent rally. But late yesterday, Toronto-based Inco Ltd. made a surprise announcement that it won't be cutting back production, as had been expected - a development that could bring the metal's rebound to a halt.
Meanwhile, a potential scandal in nickel trading involving alleged inventory fraud - and possible lost metal supplies - continues to brew in Japan, with last week's news of the scandal fueling nickel's recent rebound.
In trading on the London Metal Exchange yesterday, the metal, widely used in stainless steel, rose $75 (U.S.), or 1.3 per cent, to $5,710 a tonne. Since hitting a 3-1/2-year low on Jan. 28, nickel prices have moved 6.9 per cent higher.
"We've seen a turnaround" in nickel, says Helen Williamson, research analyst for Brandeis Brokers Ltd. "There's actually some buying coming through."
But traders predict that the announcement by Inco could put a halt to the rally.
Meanwhile, allegations of the unfolding trading scam in Japan have caught the attention of traders and analysts. Last week, Engelhard Corp., the Iselin, N.J., specialty-chemicals manufacturer and nickel consumer, said it had lost $55-million last year in what it said was a nickel fraud that possibly involved theft of the metal and its substitution with cheaper, lower-grade nickel products. The company said a half dozen other nickel-market participants may have lost $145-million in the alleged scheme.
The matter has been handed over to Japanese law-enforcement authorities, while officials at the London Metal Exchange and at the Commodity Futures Trading Commission in Washington say they have no grounds for investigation because the alleged fraud concerned a private Japanese warehouse with no affiliation to a futures exchange.
Engelhard itself says it is investigating and attempting to recover some of its losses, but market participants are still dealing with the question of how much nickel was lost and how much will need to be replaced. An Engelhard spokesman declined to comment on the amount of nickel involved in the alleged scam. Analysts estimate that between 2,000 and 10,000 tonnes of ferro-nickel scrap and nickel cathode is involved for Engelhard alone, given the extent of its announced financial losses.
"Fifty-five-million dollars (worth of nickel) is an awful lot of nickel," says Doug Upton, head of commodity research for HSBC James Capel in London. Reports of the alleged fraud "have been taken as bullish because there's some chance that the metal has been effectively stolen and that those who have lost metal will need to find more."
Traders say Engelhard hasn't bought large quantities of nickel this week, but the New Jersey company or other nickel buyers might want to stock up in case their inventories have been depleted as well, analysts say. The alleged fraud itself concerns several different companies, including laboratories, metal transporters and traders, Engelhard said last week. Executives at Engelhard Metals Japan Ltd. remained silent.
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GLOBE AND MAIL
THU FEB.12,1998
B1
** Inco swings cost-cutting axe **
** Cheap nickel forces miner to cut 700 jobs, slash dividend to 10 cents and close N.Y. office **
BY ALLAN ROBINSON
Mining Reporter
Depressed nickel prices have forced Inco Ltd. to take severe cost-cutting measures, including slashing its dividend and payroll, in search of $223- million (U.S.) in savings.
The world's largest nickel producer has been hit hard and continues to look throughout the company for ways to save. Yesterday, it announced it is cutting its annual dividend to 10 cents from 40 cents, laying off more than 700 people, closing its New York office and cutting back spending on research and development.
Inco also said yesterday that it would reduce administrative budgets and eliminate cash bonuses to be paid under an incentive plan to its senior officers.
"We want to come out of this stronger, more competitive and profitable," Inco spokesman Jerry Rogers said.
The price of nickel has plunged to a recent low of $2.52 a pound, down from $3.50 in May, 1997, although it has rebounded during the past five trading days, gaining 11 cents.
The nickel industry has been hurt by exports of stainless steel scrap and nickel from Russia, and now is possibly facing reduced demand from Asia and additional output from Australia.
"There can be no doubt that the world's nickel industry is undergoing a period of radical change," mining analyst John Lydall said in a recent report for First Marathon Securities Ltd. New hydro- metallurgical nickel recovery plants being built in Australia pose a potential threat to conventional mine-mill-smelter producers such as Inco and Falconbridge Ltd., both of Toronto.
The latest Inco casualties in the cutbacks are 500 employees from the Ontario division, 110 from Manitoba and almost 100 from its offices in New York and Toronto. The new cuts bring to 1,275 the number of Inco workers who have lost their jobs or taken early retirement since November.
Inco estimates that the employment cutbacks, along with other measures, will bring annual cash savings of $165-million, beginning in 1999. Another $57.8-million a year in cash will be saved by cutting the dividend on Inco common shares to 10 cents a year from the current 40-cent rate. That also reduces the payout on Inco's Voisey's Bay shares.
"These actions will intensify our focus on profitability,"said Michael Sopko, Inco's chairman and chief executive officer, who in a statement described the cuts as "essential."
Inco shares shed 65 cents (Canadian) to $24.95 yesterday on the Toronto Stock Exchange, down from their 52-week high of $51.45 a share set on March 10, 1997.
"I think the market was expecting more," said Manford Mallory, a senior gold and base metals analyst with Research Capital Corp.
Some mining analysts also wanted more cuts. They were hoping Inco would announce production cutbacks, a writedown on the $4.3-billion it spent in 1996 to acquire the Voisey's Bay deposit in Labrador and possible cost-saving measures by working with Falconbridge to better utilize their assets in Sudbury, Ont.
"Inco is focusing on cash conservation," said Amy Gassman of Goldman Sachs & Co., who added that she is hopeful that other cost savings can be accomplished by Inco and Falconbridge working together in Sudbury. But even with the work force reduction, Inco said it has no plans to reduce its nickel output, although the latest cuts suggest that the nickel miner has cut to the bare bone the number of hourly rated workers it employs. In the latest round of layoffs for the Ontario division, only 100 hourly rated workers are being targeted, compared with 400 salaried employees.
Inco currently has 6,142 employees in Ontario, of which 1,674 are salaried staff and 4,468 are paid by the hour. In Manitoba, it employs 1,672, of which 406 are salaried and 1,266 are hourly.
About 16 per cent of the total job losses are in Ontario and 10 per cent in Manitoba. The total annual employment cost savings from these reductions is estimated at about $75-million (U.S.).
Inco said it is continuing with a detailed analysis of each of its operating mines, which it hopes to complete by mid-1998. Analysts suspect that Inco will be looking at ways to mine more high-grade ore as part of its efforts to lower mining costs and improve efficiencies.
Inco estimates that consolidating its marketing, purchasing, engineering and other functions company-wide, together with reductions in supplies and certain services, will result in annual savings of about $52- million.
It said reductions in corporate, general and administrative expenses through staff reductions and other actions will result in savings of $19- million.
Finally, Inco said it would reduce exploration expenses by $15-million a year and research and development by $4-million.
Inco also announced onetime cash-saving measures that included an additional $50-million cut to capital expenditures planned for 1998, bringing the total cut to $105-million. Inco now plans to spend $430- million on capital projects, of which $220-million is earmarked for its Indonesian venture.
Inco also said that it could sell off additional non-core assets, which could bring in $85-million, and that it will suspend its share buyback program, which commenced in August, 1997.
Despite the extraordinary measures being taken, Inco estimates that unusual charges arising from the restructuring will cost only $50-million pretax in the first quarter of 1998 for severance costs. It also estimates an asset writedown of $14-million.
** Highlights **
Inco cutbacks, along with others announced in November, intended to save about $223-million (U.S.) a year. They include:
-Job cuts of 500 in Ontario and 110 in Manitoba, bringing total layoffs since November to 1,000 and 175, respectively .......$75-million
-Corporate staff cuts of 100 and closing of New York office ........$19-million
-Consolidate marketing, purchasing and engineering operations ........$52-million
-Reduce exploration projects .........$15-million
-Focus research and development on value-added products ..........$4-million
-Reduce annual dividend to 10 cents from 40 cents .......$58-million
-In addition, Inco will reduce its 1998 capital expenditure by another $50-million, for a total cut of $105-million since November
-Divesture of another $85-million of non-core assets
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