Nfld. & Labrador

Union happy with Tacora agreement for Wabush Mines, hopes for approval

The United Steelworkers union says it hopes the courts and government will clear the way for the purchase of the shuttered mining operation in western Labrador.

Good benefits and wages outlined in the deal, says Steelworkers rep Tony DePaulo

Cliffs Natural Resources shut down activity at the Wabush Mines operation last February. The United Steelworkers union has reached a collective agreement with a U.S.-based company, Tacora Resources. (CBC)

The United Steelworkers union says it's happy with a collective agreement reached with an American company looking to buy the shuttered Wabush Mines, and now it's a matter of getting government approval.

Earlier this week, the union announced it had reached a five-year collective agreement with Tacora Resources for the Scully Mine operation.

As a union, and trying to get jobs for our members, we were very excited about it.- Tony DePaulo

"We began discussions with TACORA well over six months ago, maybe more, and they were interested in buying the mine. After several meetings we felt that we had a good, a serious bidder for the mine," said Tony DePaulo, assistant director of the USW.

"We sat down and we negotiated a brand new collective agreement … that we feel would be beneficial to our members with some good benefits that are included in the agreement. Very good market wages that are on par with any other mine."

Cliffs Resources shut down its Wabush Mines operation in western Labrador in 2014. The mine is locked in creditor protection under the Companies' Creditors Arrangement Act, and court approval is still required for the Tacora proposal to reopen the shuttered site.

A posting on the website of U.S-based Tacora Resources is advertising for jobs with the Scully mine. The website does not appear to be working for everyone. (Tacora Resources)

Hoping it makes its way through court

That means the next step is for Tacora to get approval from the province, DePaulo said.

"We're hopeful that it will proceed through the courts and get approval from the courts," he said. "I believe the last day for that would be June 26."

DePaulo said the only company that started discussions with the union was Tacora, and he was never made aware of any other potential buyers for the mine.

The United Steelworkers union says it has reached a five-year collective agreement with Tacora Resources for the Wabush Mines operation. (Chris Ensing/CBC)

"As a union, and trying to get jobs for our members, we were very excited about it when we heard that and we looked at the tests," said DePaulo.

"We were approached by Tacora nearly a year ago, we had numerous discussions, and we ended up getting into a collective agreement. I have no idea of any other bidders that approached us."

Alderon Iron Ore Corp. was one of several companies revealed back in March to be interested in the mine to use it as a place to dispose of waste from its Kami project, putting down a $750,000 payment to show interest.

Different methods

But DePaulo said Alderon's information that the mine is at the end of its life and there's no usable iron ore left is "in direct conflict" with what Tacora has told him.

Tacora Resources has to go through the Companies' Creditors Arrangement Act in order to purchase Wabush Mines. (CBC)

"Tacora says they've done their testing and they're telling us that there's about 22 to 25 good years of mining left there," DePaulo said, adding the system Tacora uses in the U.S. allows it to separate magnesium from the ore, meaning there's more product to sell.

"They can separate the magnesium, which they can sell separately at a good price … and they can sell the iron ore. The iron ore, according to their tests, is high grade."

In a statement to CBC News on Wednesday, the Department of Natural Resources said it has "worked closely" with interested parties, and is still working through the legal process.

With files from Labrador Morning