Like many in the Timmins business community, Novenco Consultants Limited’s Erik Hoffman sees the impending May shutdown of processing facilities at Xstrata Copper’s Kidd Metallurgical site as an “opportunity to diversify.”
As a provider and servicer of acid refractory firebricks, specialty coatings, and industrial supplies, Novenco counted the Met site as one of its biggest clients. While the company will continue to do work related to the site’s concentrator, and is under contract to provide slings and chokers to the mine, the move is motivating Hoffmann to look at alternative markets.
He expects to explore areas and industries that he has not quite considered, including potential clients in the red-hot gold market. He’s also looking at concrete-related work for municipal clients, especially in southern Ontario.
“We always had enough here to keep us going, but unfortunately now we have to spread out a little bit,” says Hoffmann.
“But make no mistake about it, though: our branch in Timmins is still going to be here, we’re still going do the work, and we’re still going to do what we have to do. I just have to travel a little more, that’s all, and being a contractor, that’s what life is all about.”
Novenco, whose Sudbury headquarters are run by his father Norbert, has also been forced to put the brakes to some expansion plans. Although additional land was purchased in 2009, the company’s plans to build larger facilities have temporarily been put on hold while it tries to remain “size-appropriate” in the wake of the economic uncertainty surrounding the Met site.
Still, Hoffmann is staying positive. Contracts are underway to complete infrastructure work for Timmins, and Novenco will continue to do work for Xstrata’s Horne smelter in Rouyn-Noranda as it has for the last seven years.
“As a contractor, life is about ups and downs, but as long as you do your business well and you’re honest, you’ll always succeed,” Erik says.
Although he’s glad to see this kind of perspective from the business community, Mayor Tom Laughren is intent on doing something to make sure Timmins firms stay afloat. He’s working on brainstorming ways to see the Kidd Met site used for something that could maintain local business and local jobs.
With access to rail, water and power, the plant still offers “huge opportunities.” To examine those opportunities, a task force has been struck between the city, the Timmins Economic Development Corporation and the Chamber of Commerce.
Laughren has been given assurances from Xstrata officials that the building will remain standing through 2010 at least. He’s urgently looking for new feed or even new uses for the plant’s infrastructure.
While any outside projects would require holding extensive discussions with Xstrata to make use of the unused portions of the site, Laughren says it would otherwise be a shame for Canada’s newest smelter, built in 1980, to sit idle.
“In a lot of ways, forestry started it, and we’re now seeing it in the mining side, because a lot of these global takeovers of what we consider our resources are no longer our resources,” says Laughren.
“This is a wake-up call for Ontario, and Northern Ontario specifically, that we need to look at ways to make ourselves competitive with China, India, Japan, because if not, we’re just going to be shipping boatloads of our resources overseas for processing and manufacturing.”
Fred Gibbons, president of the Chamber of Commerce, agrees the site has many strong potential uses for what Xstrata would consider to be non-competitive metals. In particular, he speculates that it could even possibly play a role in the emerging plans with Cliffs Natural Resources, an American firm interested in developing the James Bay Lowlands chrome deposit.
While word is that Cliffs would build a rail spur to the Thunder Bay area to be processed at an as-yet-unbuilt facility, Gibbons suggests an argument could be made to use the Xstrata site instead, which is still relatively new and in good shape.
“You can expect there is going to be some significant efforts to redirect that spur line in a different direction to an existing facility where’s there’s an existing workforce, existing infrastructure and plenty of power, and so on,” says Gibbons.
Until then, however, Xstrata’s move to close the site is “definitely” going to impact the city’s many suppliers, particularly those who have the Met Site as their sole client.
Gibbons, who also serves as the president of Northern College, says the school has already begun to factor in the job losses into its planning for the next academic year for those seeking Second Career training.
Still, he says he’s confident the community will be able to use its wealth of knowledge and experience to weather the blow, especially with the promise of additional mining projects developing through the region, such as Lake Shore Gold, and Northgate Minerals.
“It’s going to have this insidious effect on the community, but we have to keep at the forefront of people’s minds that this is a cyclical industry, and as a 100-year mining camp, we have a lot of experience with this, and that we will weather it, and there are very strong signals on the horizon that it’s not all gloom and doom.”
www.novenco.com
www.timmins.ca
www.timminschamber.on.ca
