The area's mining supply and service sector gives Vale a significant competitive advantage, according to its vice-president mining and milling, North Atlantic region.
Steve Wood addressed members of the Sudbury Area Mining Supply and Service Association (SAMSSA) recently and spoke of the benefits of “having access to the highest quality supply and service sector in our own backyard.”
He also praised the sector for responding to its need to move up its planned maintenance program (PMP) this year by six weeks, due to the required rebuilding of its number two flash furnace.
“The sense of urgency and commitment displayed by everyone involved to accelerate the PMP was nothing short of outstanding,” Wood said. “I want to thank all our SAMSSA members and local suppliers for all their efforts involved.”
The maintenance program also provided a great opportunity for the area's local suppliers. Direct charges associated with the 170 projects completed amounted to $133 million, with $90 million of the expenditures spent through local business.
“We peaked at some 1,200 additional construction workers at our service plant alone,” he said.
In 2009, Vale spent $384 million in supplies and services from Sudbury area vendors and in 2010, that increased to $471 million.
“Over the past six months of 2011, we are already tracking near what our total spend was for 2009 with local suppliers,” Wood said. “When you think of the positive spin-off effect for our community, the number is truly staggering.”
Vale has embarked on a global procurement strategy, but Wood said buyers are encouraged to check first with local vendors.
“I know centralizing our procurement processes was challenging for many of you in the room and I want to thank you for your patience as we work through it,” Wood said. “From September, 2009 to August, 2010, 97 per cent of purchases for goods alone for our Sudbury operation were from vendors located in Ontario.”
The company is contemplating a $3.4-billion investment in the Sudbury Basin from now until 2015, which is part of an overall five-year investment package of $10 billion for Canada.
“We have one simple message – Sudbury matters to Vale,” Wood said.
“These dollars are focused on rebuilding and modernizing our assets, reducing emissions and extending the life of existing mines and finding new sources of ore to prolong our future,” Wood said.
“This is significant good news for Sudbury's economy and especially for you as members of SAMSSA.”
At Clarabelle Mill, Vale has embarked on a challenging ore recovery program (CORe), a $200-million investment “that will change our flow sheet and increase recoveries by approximately four per cent,” he said. “This increases the ability to maximize the value of the resource in the ground and consequently increases the resource base we have to choose from as borderline ores become more attractive.”
The project includes the construction of a building and the implementation of the new flotation system and will create 150 to 200 construction jobs at its peak.
Wood said so far, 60 per cent of the of the value of the contract associated with the project has been sourced locally and more is expected as it moves forward.
Vale's atmospheric emissions reduction project, Clean AER, will result in significant economic spinoffs in the Sudbury Basin and Northern Ontario. The $2-billion investment will result in an 80 per cent reduction of sulphur dioxide emissions from current levels.
“It will be like performing open heart surgery on our smelter while we continue to operate uninterrupted,” Wood said.
The project's feasibility study is in its final stages and board approval will be sought later this year.
“Once approved, we can expect an additional 1,400 workers on site at any given time,” he said. “This project is of great interest to SAMSSA members and we are committed to keeping you informed.”
Construction could begin in early 2012 and be completed by late 2015.
The company will continue its investment on Totten Mine, the first new Vale mine in Sudbury in 40 years. With a lifespan of about 20 years, it will provide employment for approximately 130 people.
In response to increasing global demand from developing countries, Vale is developing a new copper strategy to increase copper production.
“Sudbury is playing a pivotal role,” Wood said. “An aggressive exploration and drilling program is underway in zones of high copper and precious metals, including the Capre and Victor properties in Sudbury. We are also looking at a number of near surface deposits in the Sudbury Basin.”
Wood assured SAMSSA members Vale plans on being in Sudbury for a very long time and leading the mining industry.
“The supply and service sector has much to offer Vale and Vale has much to offer the supply and service sector. Ultimately, your success is our success.”
