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Chilean firm seeking Sudbury-area suppliers

A warm Chilean wind blew through Northern Ontario as senior officials from Minera Esperanza visited Greater Sudbury and North Bay to source the region’s expertise and supplies in mining.
Juan Carlos Cuadra, procurement manager with Chilean mining firm Minera Esperanza, discusses welding research opportunities with Don Dekker, CEO of the Materials Joining Innovation Centre and Olivar Hernandez, CFO of Minera Esperanza.

A warm Chilean wind blew through Northern Ontario as senior officials from Minera Esperanza visited Greater Sudbury and North Bay to source the region’s expertise and supplies in mining.

Company representatives hosted one-day sessions in each centre to help source more than $500 million in procurement for their open-pit copper Esperanza project in Chile.

“This region has a well-developed mining industry, so it only made sense to come here,” says Olivar Hernandez, chief financial officer with Minera Esperanza.

“It has a very good reputation and we hope it has the capability to help us with our upcoming project.”
The nearly $2-billion project is currently under construction, with production expected to begin in 2010.

This leaves officials a year to seek a laundry list of required materials, including horizontal pumps, air compressors, valves, ventilation systems, pumping and compression equipment and telecommunications systems, to name a few.

Such materials were much more difficult to obtain up until recent months, though recent fluctuations in the mineral markets are freeing up potential suppliers the world over, according to Juan Carlos Cuadra, the company’s procurement manager.

While the company has sourced supplies from places like Finland, China, and the United States, it has yet to directly source any supplies from Canada. As such, the company is unfamiliar with Canadian products and the associated quality control processes, and there is an eagerness to develop new relationships with Canadian firms, he says.

“These kinds of relationships could actually work very well for Northern Ontario firms, as Chilean companies are very close and working with us could open the door to working with others in the region,” says Cuadra.

Despite the current fluctuations in the copper markets, Carlos says the company is focused on a view of long-term prices, and the belief that they will pick up again in time. Being largely owned by the Antofagasta Group, which oversees a number of mining projects around the world, also should provide some assurances to potentially nervous suppliers, he adds.

While Minera Esperanza’s curiosity in Canada was strong, its Northern visits weren’t made without some encouragement.

In fact, the Northern Ontario visits were spearheaded by Export Development Canada (EDC) in partnership with the Canadian Association of Mining Equipment and Services for Export, the Sudbury Area Mining Supply and Service Association as well as the Ontario Ministry of Northern Development and Mines.

In exchange for providing some financial assistance to Minera Esperanza, the EDC received assurances of serious consideration for the use of Canadian suppliers that meet their needs and offer strong bids.

These kinds of events hold great promise for people like Joanne Cain, regional sales manager with Manitoulin Transport, who says the meeting represents a solid chance to discuss freight forwarding opportunities with company officials.

Having traveled from Sault Ste. Marie to attend the Sudbury event, Cain says Manitoulin Transport’s freight forwarding division, Paltainer, already provides similar services to many other Chilean companies. Account managers with the company already travel to Chile several times a year to develop additional relationships, and having Minera Esperanza arrive at its doorstep instead is a welcome event.

“I do see a great deal of opportunity for us here,” she says. “It is a market that we are already involved in, and certainly this will open up the door for more partnerships. Besides, these kinds of events are great networking opportunities within our own domestic markets, so the whole thing is absolutely an advantage for us.”

This perspective is shared by officials from the Materials Joining Innovation Centre (MaJIC), who made the trip from their Kirkland Lake offices to sell Minera Esperanza on their welding research expertise.

“It was a bit of a long trip but we definitely think we can help them out with welding issues like failure analysis and stress relief,” says Don Dekker, CEO of MaJIC. “We’re pretty confident that we can be a great help there.”