Posted on August 26, 2013 | Atlantic Business Magazine | 0 Comments
The Conference Board of Canada’s provincial outlook, released in June, predicted Canada’s easternmost province will lead the country with a six per cent rise in GDP growth in 2013. And for 2014? Another increase, of about 3.4 per cent.
A boom in major industrial development is a huge contributing factor. The Atlantic Provinces Economic Council (APEC) says Newfoundland and Labrador will “dominate activity” in Atlantic Canada with $9.4 billion of major project investment in 2013—up 10 per cent from 2012.
The provincial government says over $36 billion in major capital spending is planned or underway in the province. Just where and how does $36 billion get spent? Here, we break down the 10 biggest (in dollar value) major industrial projects in the province. Note: Residential, commercial, health, and public infrastructure projects were not included, nor were on-going capital expenditures on existing projects.
Investing in exploration Boding well for the future, resource exploration in 2013 is at a high level: • Offshore: work commitment of $1.2 billion; 38 active exploration licences • Mineral exploration: provincial government expects a record expenditure of $213 million ($182 million in Labrador; $31 million in Newfoundland).
Click on the icon for more information on each project.
Sources: Government of Newfoundland and Labrador’s Inventory of Major Capital Projects / APEC’s Major Projects Inventory 2013.
THE BIG ONE TO WATCH
Voisey’s Bay Underground Mine Development $2 billion An agreement was reached in spring 2013 with the provincial government to extend current open-pit mining activities in Voisey’s Bay to underground. Construction is to begin in 2015 and will extend the mine’s lifespan by at least 12 years, to 2035.
DSO Project $500 million • Tata Steel/New Millennium developing this former IOC mining site (closed in 1984 due to unfavourable conditions) • Project includes construction of processing plant, power plant, and rail and camp facilities. • First ore (300,000 tonnes) produced in 2012; production should reach 6 million tonnes by 2015.
Labrador Iron Mines $200 million • Open-pit iron ore mining project under development. • Production began in 2011 with 1.2 million tonnes of direct shipping iron ore; full project ramp-up expected in 2013 with 2 million tonnes. • LIM owns 10 deposits in Labrador and 10 in Quebec—more mining sites to be developed in near future.
Kami Iron Ore Project $1.27 billion • Alderon Iron Ore Corp. developing large open pit mining and iron ore processing project. • Construction could begin in late 2013 and peak in 2014 with 900 employees. • First ore expected late 2015; production to begin at 8 million tonnes per year.
IOC Expansion $828 million • Phase I of the expansion project completed in 2012, the mine’s production capacity increased from 18 million tonnes to 22 million tonnes of iron ore concentrate. • Phase 2 construction continues in 2013; will increase production to 23.3 million tonnes of concentrate. • Upgrades include: overland conveyor, new grinding mill, upgrades at the Wabush terminal sub-station, and an expansion of the magnetite processing facility.
Muskrat Falls $6.2 billion • Includes construction of 824 megawatt hydroelectric generating facility at Muskrat Falls and 1,500 km of transmission lines and associated infrastructure which are overseen by Nalcor (the Newfoundland and Labrador energy corporation). • Peak construction in 2015 with 3,100 employees. • Project officially sanctioned in December 2012; first power expected in 2017. • See also: Emera’s Maritime Link Transmission Line (listed separately and not included in the $6.2 billion)
Long Harbour Nickel Processing Plant $4.25 billion • Primary construction at Vale Newfoundland and Labrador Limited’s nickel processing facility to wrap up in 2013 (further refinement capability to be added in 2014-15). • Construction peaked in summer 2013 with 5,500 employees. • $1.216 billion in expenditures scheduled for 2013. • Initial processing could begin by end of 2013.
Hebron $14 billion • Cost estimates have increased from $8.3 billion to $14 billion, making Hebron by far the most expensive project on the books. • Construction began 2012, will peak in 2013-14 with 3,500 employees. • Province to receive $16 billion in revenues over the life of the project. • First oil expected in 2017; project expected to continue until 2046.
White Rose Expansion $3.2 billion • White Rose offshore oil project operator Husky Energy is developing satellite expansions to be “tied back” to the SeaRose floating production, storage, and offloading (FPSO) vessel currently in use:
• North Amethyst ($2 billion) expansion: first oil in 2010; development drilling continues in 2013. • South White Rose extension ($1.2 billion): first oil expected in 2014. • West White Rose (unknown): two-well pilot project began in 2011; development planning continues.
Hibernia Southern Extension $1.7 billion • Province of Newfoundland and Labrador (through Nalcor) has a 10 per cent stake in the project; expects $13 billion in revenues. • Development for 2013 includes drilling 10 wells on the field ($1.1 billion); Hibernia GBS topsides modifications also planned. • First oil June 2011; remaining 167 million barrels under development.
Maritime Link Transmission $1.52 billion
• Emera Newfoundland and Labrador responsible for all steps (from financing to commissioning) of the “Maritime Link,” including a 180 km subsea transmission cable.
• Total project cost $1.52 billion; APEC estimates the share of the project in Newfoundland at $800 million (the remainder to occur in Nova Scotia)
• Project received release from environmental assessment in June 2013; peak construction by 2015.
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