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One year after rebirth of Algoma Steel, loose ends remain

Deadline to wrap everything up is midnight on New Year's Eve
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Former mine site on the east side of the ghost town of Goudreau, Ont. Locals say the building shown is a former smelter. (Jeff Klassen/SooToday)

Saturday, Nov. 30 marked the first anniversary of the $2-billion deal that saved Algoma Steel.

But the insolvent predecessor company, formerly known as Essar Steel Algoma Inc., still exists under a different name and remains under protection as a court-appointed monitor tries to wind up four years of insolvency proceedings.

Ontario Superior Court Justice Glenn Hainey has given the monitor until the stroke of midnight on New Year's Eve to tie up remaining loose ends and close the file.

According to court filings, unifinished business that the monitor has been working on since summer includes:

  • marketing and sale of certain northern Ontario properties that continue to be owned by Essar Steel Algoma Inc., including the MacLeod Mine and the Goudreau Mine
  • implementation of measures relating to the 'wrap' pension plan, which covered workers employed by the original Algoma Steel Inc. prior to its acquisiton by Essar.
  • completion of the process mandated by a priority claims order that modified the priorities of creditors
  • tax matters

Essar Steel Algoma Inc. was first granted protection from its creditors under the Companies' Creditors Arrangement Act (CCAA) on Nov. 9, 2015.

The sale of Sault Ste. Marie's steel operations to term lenders and senior noteholders who'd kept the company afloat for three years was consummated on Nov. 30, 2018.

The George W. MacLeod Mine is located north of Wawa, along the Magpie River.

Iron ore mining started there in 1898, ending a century later in 1998.

The Goudreau Pits are located next to the ghost town of Goudreau.

Pyrite was mined from four open pits that started operation in Goudreau in 1914 and initially suspended operations in 1919.

The pits were also mined from 1959-62, with ore shipped to Wawa.

When the sale of the Sault's steelmaking operations closed last year, the legacy mine properties were specifically excluded from the transaction.

Essar Steel Algoma Inc., otherwise stripped of its assets and revenue, quietly changed its name late last year to Old Steelco Inc.

Court documents filed a week before last Christmas confirmed there will be nothing left for 125 Sault companies still owed for work done or supplies provided before the steelmaker filed for CCAA protection.

This story originally appeared on SooToday.com.




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