Premier McGuinty Urged to Prevent Closure of Xstrata Met Site

April 9, 2010, 12:19 PM EST

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The Ontario government will set a dangerous precedent if it allows foreign mining giant Xstrata to close its high value-added Kidd Creek Met site and simply mine raw materials in Timmins, Ontario, CAW President Ken Lewenza says.

If Xstrata is allowed to close its Metallurgical site this summer costing 670 direct jobs and more than 4,400 indirect jobs, it will be a serious step backward for the province, Lewenza told Premier Dalton McGuinty at an April 8 meeting.

Lewenza urged McGuinty to ensure the highly profitable company continues to provide high value-added jobs at the Met site if it wants to continue extracting Ontario mineral resources.

A coalition of Northern Ontario Mayors, regional politicians and union representatives met with McGuinty at Queen's Park April 8 to urge a halt to the closure of the Xstrata Metallurgical site. CAW Local 599 represents workers at the Met site.

Here is a summary of other points raised by Lewenza:

- Foreign mining giant Xstrata continues to make huge profits. "What the company digs out of the ground and processes in Timmins has a market value of some $1.6 billion per year - we know these operations are highly profitable. This is not about a company losing money and pulling back;"

- Smelters are needed to turn raw materials into metal. "Even at a time when metals companies are raking it in, smelting is not going to be the highest profit centre. But, critically, smelting is where we see the most value-added jobs, high tech investment and the greatest economic spin-off;"

- Xstrata makes profits from mining and smelting. Xstrata's own forecasts show it expects healthy profits from both sides of its operations - 85 per cent from the mine and 15 per cent from the smelter. "If a company makes hundreds of millions in profits from mining, but not as much on smelting, should they be allowed to simply close the smelter?"

- Contrary to claims there are not enough raw materials to keep the Met site running, the fact is just the opposite. "Very soon we will be in a position of exporting raw materials out of Canada, which is against even the lax rules under the current Ontario Mining Act."

- The closure will devastate the community. "The economic impact, calculated by independent researchers, shows that for every job lost in the Timmins area, another three jobs are expected to be lost elsewhere in Ontario, bringing the total job loss above 4,400." In addition, the closure of the Met site means the loss of $152 million in tax revenue annually.

- Ontario has the power to enforce change. "Even under the current Mining Act, which should be toughened up, the Ontario government has the power to insist on refining and processing in Canada and to approve new licences.we must send a signal that Ontario will insist on value-added jobs as part of the exchange for access to our resources."

Download and send a letter to provincial and federal politicians, urgig them to stop the closure of the Met site!

Form letter to Ontario Premier Dalton McGuinty

Form letter to Prime Minister Stephen Harper

Form letter to Industry Minister Tony Clement

Form letter to Minister of Northern Development, Mines and Forestry Michael Gravelle

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