MININGInco moving ahead with Voisey's Bay despite protestsLocal...

MINING

Inco moving ahead with Voisey's Bay despite protests
Local leaders upset with company's plan to subsidize travel costs for employeesBy NICOLE MORDANT

Thursday, August 25, 2005 Page B3

Reuters News Agency

VANCOUVER -- Inco Ltd. is playing down threats from Canadian native and political leaders that they may disrupt the start of its large Voisey's Bay nickel mine because of a spat over workers' travel benefits.

"We're forging ahead at Voisey's Bay. We have begun blasting ore and are looking forward to producing our first concentrate in the next few weeks," Inco spokesman Steve Mitchell said yesterday.

The Voisey's Bay mine in Labrador is expected to produce 50,000 tonnes of nickel a year. That would make it one of the world's biggest sources of nickel, which has been in short supply in the past two years and is a key ingredient in stainless steel.

Leaders of the Inuit and Innu nations, as well as a handful of local politicians, recently have accused Inco of a breach of trust because it has started subsidizing the travel costs of workers flown into the remote mine site from other parts of Canada. Previously, workers had to mostly pay their own way.


But Labrador community leaders are angry because they say the policy conflicts with the spirit and intent of agreements signed by Inco to employ and train local staff at the project.

"We did not initiate this change, but we will need to review our IBA [impact benefit agreement] to assess the impacts," said Ben Michel, president of the Innu Nation, in a statement headlined "Labrador groups considering action to stop operations at Voisey's Bay mine."

"We may also seek to have the mine mill project re-reviewed by the environmental assessment agency as it is in fact a different project than what we had agreed to," he said.

Inco's Mr. Mitchell said that more than 80 per cent of the employees at the mine are from Labrador and more than 50 per cent from the aboriginal community.

Carmel Turpin, a spokeswoman for the government of Newfoundland and Labrador's Department of Mines and Energy, said the new travel plan didn't contravene any of the legal agreements the provincial government has with Inco.

The United Steelworkers, the union that represents workers at Voisey's Bay, could not be reached for comment.

Voisey's Bay is important for Inco as it strives to expand and replace declining output from its aging mines in Canada. The deposit, which Inco bought in 1996, has taken many years to develop not least because of a standoff in the late 1990s between the company and the provincial government, which demanded that the mined ore be processed in the province.

Inco's stock was down $1.33, or 2.67 per cent, at $48.53 on the Toronto Stock Exchange yesterday.

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Inco had no problem bringing in "scab" workers by Helicoptor during the Feb-Mar 2004 strike at Sudsbury.

It put costs up & lowered production & was good for the Nickel price.

Voisey's Bay will not be the downfall of Nickel.

Voisey's Bay will create good buying opportunities for Nickel.

Voisey's Bay does not meet the shortfall in Nickel demand.

Risk is to the upside with Nickel.

Cheers.