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Gold/Mining/Energy : A to Z Junior Mining Research Site -- Ignore unavailable to you. Want to Upgrade?

To: 4figureau who wrote (171)	6/6/2002 12:00:54 PM
From: kidl	Respond to of 5423

Donner (DML.V) reacting to this article? Inco, Newfoundland reach Voisey's Bay deal Tentative agreement: Can ship nickel ore outside province until $1.1B plant is built Drew Hasselback and Ian Jack Financial Post Negotiations between the province of Newfoundland and Inco Ltd. over the development of the massive Voisey's Bay nickel deposit have concluded, and a tentative deal has been reached that could be finalized as early as Friday. The proposed deal gives Inco the right to operate Voisey's Bay for at least 25 years and binds the company to process ore mined there at a facility that will be built in Newfoundland, sources told the Financial Post. But the deal also grants Inco the right to ship ore outside province while the $1-billion experimental processing facility is being developed. Until the plant is ready, Inco would be allowed to ship the ore to its smelters in Sudbury and Thomson, Man. The agreement was concluded on Tuesday following weeks of talks in Toronto between Inco executives and a Newfoundland team, led by Lloyd Matthews, the mines minister. It still requires the approval of Scott Hand, Inco's chief executive, and Roger Grimes, Newfoundland's Premier. If the two sign off, the deal would likely be announced early next week, sources said. Mr. Grimes has also said he would present any Voisey's Bay deal to the Newfoundland legislature for a free vote. The sticking point in the negotiations was Newfoundland's insistence that Inco commit to guarantees that ore will be processed within the province. Sources confirm the federal government also will contribute $60-million in funding from its Technology Partnerships Canada program for the construction of the experimental hydromet facility. Another $50-million will be provided by the Department of Indian and Northern Affairs to train local Innu for work in the mine and plant. The Atlantic Canada Opportunities Agency will kick in $25- million and the Department of Human Resources Development another $15-million for job training. Inco bought Voisey's Bay Nickel Co. Ltd. in 1996 for $3.2-billion from Robert Friedland's stock market darling, Diamond Fields International Ltd. Since then, the Toronto-based miner has been butting heads with the Newfoundland government over the terms of a development agreement. Inco actually started some engineering and procurement work by 1998, but pulled the plug after the Newfoundland government refused to permit the company to build only a mine and mill at the site, then ship the ore to Sudbury for processing. Subsequent negotiations broke down in January, 2000, when once again the province refused to agree to a deal that allowed Inco to process ore outside the province. But there has been imminent speculation of a new deal over the past few weeks. Negotiators from Newfoundland and the company have been meeting in Toronto for at least the past two weeks. Talks were rocky. On May 27, Mr. Grimes held a press conference in St. John's and declared the Inco's latest offer was unacceptable. Meanwhile, the fate of the project moved ahead on other fronts. Officials from the office of Allan Rock, federal Industry Minister, had confirmed the $150-million in federal funding. dhasselback@nationalpost.com