Nfld. & Labrador

Wabush Mines sale talks off between Cliffs, MFC Industrial

The local president of the union representing steel workers in Wabush says talks between MFC Industrial and Cliffs Natural Resources for the purchase of Wabush Mines have broken off.
A local president with the United Steel Workers Union in Labrador says talks are off between two companies for the sale of the idled Wabush Mines operation. (Chris Ensing/CBC)

The local president of the union representing steel workers in Wabush says talks between MFC Industrial and Cliffs Natural Resources for the purchase of Wabush Mines have broken off.

Jason Penney, with the United Steelworkers Union, told CBC News the potential sale of the idled iron ore operation won't be going ahead.
Jason Penney, with the United Steelworkers Union, says the union received word Wednesday morning that talks for the sale of Wabush Mines had broken off between MFC Industrial and Cliffs Resources. (CBC)

A spokesperson with MFC Industrial confirmed Wednesday afternoon that "discussions have been terminated" between the two companies.

In July, workers with USW Local 6285 agreed to a five-year contract to work for MFC Industrial if the sale went ahead.

Penney said the union received word Thursday morning that MFC and Cliffs were "unable to reach an agreement" on the sale of the mine.

"For the people who are still employed, to be honest, I don't know what it means. This news is very fresh to us, and what the actual implications are going to be I don't know," said Penney.

"I haven't spoken to Cliffs about their intentions, but I would imagine that it's not going to be good news."

Penney said he doesn't have details, but has received word that MFC Industrial does plan to have an operation in western Labrador in the future.

Many members with the union were left without jobs when the mine shut down operations in February.

Penney added there was no reason provided for the reason the talks broke off.

Town's finances uncertain

Wabush Mayor Colin Vardy said the town received notification from MFC Industrial about an update, but didn't know what the news would be.
Wabush Mayor Colin Vardy says with the idled Wabush Mines, the town is short $3-million for its 2015 budget. (CBC)

"They notified us that the talks between MFC and Cliffs have been called off, and they're now looking at another option, which includes them as the owner of the land," said Vardy.

Vardy said the main concern for his town is to get someone to take over operations, and aren't too concerned with which company it is.

"Simply what we're interested in is getting our people back to work and having industry in our town."

He added the municipality is going through its budget process, and is expected to have a budget for 2015 to the provincial government in December, but said the town is more than $2-million short for that budget.

"We are getting very creative on how we can find $2-million within our budget, but with it being 30 per cent of our budget, it's going to be hard."

Vardy added the town council will be talking with the province to figure out a situation that will help deal with the monetary loss.