Offers on the books for the purchase of Wabush Mines

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$40M to go back in Wabush Mines pension and medical plan, if deal approved

A report by FTI Consulting has confirmed there is interest in buying the shuttered Wabush Mines in Labrador West.

The company, which is overseeing the mine's creditor protection proceedings, said "a number of proposals" were received by the binding offer deadline, of March 27. Interested parties had to pay a $750,000 deposit.

"Each of the proposals can be considered and compared, including as against the other alternatives available to the Vendors, with a view to making a prompt decision as to which option to proceed with," the report reads.

Four parties have expressed interest in the mine in the past. MFC Industrial, the leaseholder of the site and its mineral rights — which has attempted to purchase the mine in the past — is the only named company.

"Any time that we have any interest in Wabush is a good thing," former Wabush mayor and mine worker Rob Barron told the CBC. "The frustrating part of it is what interest is it? ... No one really knows what's going on here."

The names of the companies that made offers by March 27 were not released in the report.

"I don't know if any of these same parties have submitted proposals or if they are new people," Labrador West MHA Graham Letto told the CBC. "I spoke with the monitor late Friday and he's not prepared to release the number of proposals received or who, in fact, they were."

Need to proceed quickly

Letto said the monitor is seeking clarification on the proposals received. The mine's assets have been locked while the company has been in Creditors Arrangement Act (CCAA) proceedings, that are set to end on June 30.

"This is something that they want in place before that deadline," Letto said. "I think we're pressed for time ... the monitor is working under that deadline so things have to move fairly quickly."

Alderon Iron Ore company also recently spoke about its interest in using the Wabush mine pits to dispose of tailings for its Kami project. It said it believes the mine, as an iron ore producer, is no longer economical. 

"It would be a good tailings pond, but it's a mine," Barron said. "There are ore reserves that are in the ground that can benefit this region and this province as a whole."

Letto said the government has had some preliminary conversations with one company interested in restarting the mine but would not name it. Nor did he know if it was one of the companies making a proposal. 

"Any new buyer with Wabush Mines would have to come to government to deal with permitting, the reclamation board, the closure plan," Letto said.

"Hopefully the proposal that's chosen by the monitor in the courts is one that would see Wabush Mines reopen and continue to operate."

Correction : A previous version of this story stated there were four offers for the purchase of Wabush Mines. However, the report does not specify how many offers were made by March 27.(Apr 03, 2017 11:07 AM)