Golden opportunity lost: mining company rejects B.C. offer worth millions

After months of talks, Edmonton-based mining company HiTest will mine silica sand from the Golden area, but process it in Newport, Washington.

Edmonton-based company will mine silica sand from the Golden area, but process it in Newport, Washington

Golden, B.C. is home to high-quality silica — which can be mined in operations like the one pictured here. (HiTest Sand)

The town of Golden, B.C. just missed out on a golden opportunity — the chance to process the silica sand that is mined in the region and the over 100 accompanying full-time jobs.

HiTest, an Edmonton-based mining company, spent months negotiating with the municipal and provincial government, as well as BC Hydro, only to announce yesterday that they would be building their processing plant south of the border in Newport, Washington.

In an e-mailed statement to CBC, company representative John Carlson wrote that they had preferred to build the site in Canada, but economic factors prevailed.

We were able to offer them a very, very good deal.- B.C. Minister of Energy and Mines Bill Bennett

"Unfortunately the combination of higher electricity prices, construction costs, and Golden's remote location, made the site not economically viable."

HiTest said it was still looking forward to conducting its mining operations in the area.

Karen Cathcart, Area "A" Director for the Columbia Shuswap Regional District, said she's disappointed.

"We absolutely need family-feeding jobs in our community, and this would have increased our economic base and transformed the region."

She estimated that the processing plant would have created 150 to 170 full-time jobs.

Washington offer 'impossible' to beat

Provincial mines minister Bill Bennett  — who was part of the negotiations — said a major sticking point was the cost of electricity.

"We were able to offer them considerable assistance in terms of the cost of the hydro infrastructure ... It was going to require a new substation, all of that costs a few tens of millions of dollars, and we were able to offer them a very, very good deal."

However, Washington state was able to undercut B.C.'s offer, he said, providing HiTest with less-than-cost electricity, free land and infrastructure.

"It's impossible for any Canadian province to compete with that."

As for what it means for future British Columbian mining projects that might want to process in cheaper facilities south of the border, Minister Bennett didn't offer any concrete solutions.

"We've got the programs in place, but when you have a jurisdiction like the state of Washington that seems to buy jobs and have taxpayers and rate payers subsidize private business — that's their public policy — it's not ours."

With files from Daybreak South