BOOMING LABRADOR NEIA October 28, 2011
AGENDA Labrador City Infrastructure & Facilities The Iron Ore Boom Expansion & Economic Activity Impacts on Labrador West Opportunities for the Environmental Sector Questions
LABRADOR CITY The Iron Ore Capital of Canada
Where we are and how to get there Airline service by 2 major carriers to Wabush Airport 570 km by road from Baie-Comeau,QC 1,200 km by road from south coast of Labrador 415 km by rail from Sept-Iles, QC (year round port)
LABRADOR CITY Incorporated in 1961 First elected Council in 1981 Well engineered community that was designed and built by the local mining company Layout in accordance with principles of good land-use planning Has all the amenities of other urban regions in the province
Infrastructure & Facilities 55 km of paved streets Fully engineered systems for Water distribution Sanitary sewer collection Storm sewer collection 2 sanitary sewage treatment plants Approx 3,300 living units Fully serviced industrial park Commercial business park School system offering K-12 CONA Campus Hospital and new $90M facility under construction Comprehensive recreation facilities including Arena, curling club, 18 hole golf course, alpine and Nordic ski facilities, tennis, softball and soccer facilities 2 shopping malls Arts and Culture Center
Iron Ore Boom Driven by demand from China s desire to modernize Shanghai 1990 Shanghai 2010 Iron ore demand expected to double in next 15 years 2011 ore prices at US$170/tonne versus US$50/tonne in 2008 Lab West ore producers expanding production output to meet increased demand
Iron Ore Producers Are Expanding in Eastern Canada Location : Ungava Bay Production increase: 10-20Mtpa Expected production start: 2016 Location: Shefferville Production increase: +22 Mtpa Expected production start: 2015-16 Location : Bloom Lake Production increase: +8Mtpa & +8Mpta Expected production start: 2012 & 2016 OCEANIC IRON ORE CONSOLIDATED THOMPSON ARCELOR MITTAL NEW MILLENIUM IOC WABUSH MINES Location : Labrador City Production increase: +25 Mtpa Expected production start: 2016 Location : Wabush Production increase: +1.5 Mtpa Expected production start: 2012 Location : Fermont Production increase: +10 Mtpa Expected production start: 2013 QUEBEC CITY ST. JOHN'S MONTREAL CHARLOTTETOWN FREDERICTON HALIFAX November 1, 2011
Iron Ore Trough and Communities
Expansion and Economic Activity Iron Ore Company of Canada (IOC) is the major employer in the region Operation began in 1962 and has produced in excess of 1 billion tonnes of crude ore Has 2.5 billion tonnes of resources and 6 billion tonnes of know exploration licenses or leases. Employs approximately 2,200 employees (1,700 in Lab City). Operated by majority shareholder Rio Tinto Current production rate is 18 MT/yr Concentrator Expansion Project (CEP) currently under way
Concentrator Expansion Project (IOC) Increase concentrate production from 18 to 26 MT/yr - $540 Million investment for phase I CEP 1 Construction of 6 km overland conveyor, autogenous grinding mill and associated mine and rail equipment Due to be complete in Q4-2011 CEP 2 Process plant improvements Mining Equipment Rail cars and locomotives Due to be complete in Q4 2012 CEP 3 Matching of new systems with existing operating systems
Genesis Expansion Study (IOC) Order of magnitude study started in 2011 to evaluate increasing production from 26 to 50 MT/yr Currently in evaluation phase If approved, target to commence production by mid 2015
Other Mining Expansion Activity in the Labrador West Area Wabush Mines 5 MT/yr production Production increase of 1.5 MT/yr planned for 2012 Majority shareholder Cliffs Natural Resources Bloom Lake (Near Fermont, QC) 8 million tonne per year production Currently undergoing production expansion to 16 MT/yr Majority shareholder Cliffs Natural Resources
Other Mining Expansion Activity in the Labrador West Area Mount-Wright Mining Complex 1,000 employees 15 million tonnes per year production Majority shareholder Arcelor Mittal Recently announced a $2.1 Billion expansion 10 MT/yr increase in production Creation of 8,000 jobs during construction (2011-2014) Creation of 3,000 permanent jobs (direct and indirect)
Other Potential Developments for Labrador West Alderon Iron Ore Corp. Kami Deposit 490 MT of indicated resource & 598 MT inferred resource Located 5 km southwest of Wabush Mines operation 2.5 KM away from paved highway Estimated commercial production in 2015 Capital Cost of US$989 million Mine life of 15.3 years (Rose Central Pit) Anticipated production of 8 MT/yr Projected employment of +1,500 full time jobs for >20 years 268 jobs at mine and concentrator 1,254 indirect jobs for local supplier & support groups 768 temporary jobs during construction
Impacts on Labrador West Labrador City is surrounded by major iron ore deposits making available land for industrial and residential development an issue Little to no advance indication of demand for housing & other needs Necessary to permit development of temporary accommodations to house demand for construction workforce Significant increase in demand for supply and service sector Increase in demand on all municipal infrastructure and services.
Accommodations and Housing Virtually no new housing starts for prior 25 years Ongoing residential developments will introduce 350+ new dwelling units in next 2-3 years One new motel opened in 2011 and another scheduled for completion in 2012 One surplus school converted to an apartment complex and another for office use One 52 unit apartment building under construction and another in planning stage. Approximately 1,000 temporary accommodation units erected (pre-fab modular construction) Numerous inquiries and expressions of interest in residential development
Residential Developments
Temporary Worker Accommodations
Environmental Sector Opportunities With ongoing and future expansion and development activities the opportunities for the environmental sector are numerous. Construction & project management Geotechnical assessment EA permitting and compliance Environmental and social assessment Natural resource management Infrastructure upgrades Planning and design
To Contact Us Council Office (Tel) 709-944-5537 (Fax) 709-944-2810 Krista.Hedlund@labcity.nf.ca
Thank You Questions?