Mining
Monday, November 13th, 2023 7:28 pm EDT
Key Points
- Stop Work Order Impact on Donkin Coal Mine: Kameron Collieries, the owner and operator of the Donkin Coal Mine in Nova Scotia, has decided to lay off the remaining hourly workforce and place the mine in an idled state. This decision is a result of a 118-day Stop Work Order (SWO) issued by the Nova Scotia Department of Labour, Skills and Immigration since July 15, 2023. Despite the temporary nature of SWOs and the common occurrence of roof falls in underground mines, the SWO remains in place, making it one of the longest in Nova Scotia’s recent history.
- Economic Impact and Job Losses: Prior to the SWO, Kameron employed over 130 full-time staff, with projections to grow to approximately 250 at full production. The Donkin Mine’s economic significance includes creating jobs directly affiliated with the mine, local trucking, and the Sydney marine export terminal. At full production, Kameron was anticipated to be the 6th largest private sector employer in Cape Breton. The mining jobs pay around $80,000 per year before bonuses and overtime. The anticipated GDP impact over the mine’s 25-year life was estimated to be $1.6 billion, providing substantial value to the region.
- Advocacy for Mine Reopening: Morien Resources Corp., holding a 2% to 4% royalty interest in the Donkin Mine, expresses disappointment about the circumstances leading to the mine’s idling. Morien plans to advocate for a potential return to production, although Kameron has not indicated a timeline for reopening. Morien commits to keeping shareholders, stakeholders, and investors updated on the mine’s operational status as information becomes available.
Morien Resources Corp. (“Morien” or the “Company”) (TSX-V:MOX), today provides an update on the Donkin Coal Mine (“Donkin” or the “Mine”) in Nova Scotia, owned and operated by Kameron Collieries (“Kameron”), upon which Morien has a 2% to 4% royalty interest.
In consideration of a 118-day long Stop Work Order (“SWO”), in effect since July 15, 2023, Kameron has made the decision to lay off the remaining hourly workforce at the Mine and to place the operation into an idled state with no timeline to resume operations.
The SWO was put in place by the Nova Scotia Department of Labour, Skills and Immigration (“DOL”), a provincial regulator for the Mine. The SWO was issued in response to a roof fall incident on July 15 that was subsequently ameliorated by Kameron between July 19 and July 27.
While SWO’s are meant to be temporary in duration, and while roof falls are not uncommon in underground mines1, and while no Kameron workers were injured nor any equipment damaged during the fall, the SWO nonetheless remains in place at the time of this news release, approximately four months after the fall was reported, which Morien understands makes it one of the longest SWO’s in Nova Scotia’s recent history.
In the words of Gardner Pinfold Consultants Inc., an economics consultancy based in Nova Scotia which recently completed a socio-economic impacts analysis of the Donkin Mine – “There are very few single prospects in Nova Scotia with the potential to provide economic impacts of this scale and extended period.” Kameron have spent over C$300 million developing the Mine since 2015. Prior to the July SWO, Kameron was employing over 130 full-time staff, a number that, at full production, was projected to grow to approximately 250, with local trucking and the Sydney marine export terminal accounting for an additional 130 jobs directly affiliated with the Mine, in addition to the hundreds of spinoff jobs that Donkin creates in the local region. At full production, Kameron would be the 6th largest private sector employer in Cape Breton, in a region with a 12% unemployment rate, more than double that in Halifax Regional Municipality2. These mining jobs pay approximately $80k per year before bonuses and overtime3. The GDP impact to the Cape Breton economy stemming from Donkin’s mining operations, over its anticipated 25-year mine life, is expected to be in the order of $1.6 billion, or an annual average GDP contribution of $52 million, a substantial value-add to this region of Nova Scotia4.
Morien is disappointed that the circumstances surrounding the regulation of the Donkin Mine have compelled Kameron to idle the operation. While Kameron has given no indication of its timing to reopen the Mine, Morien will be working diligently to advocate for a potential return to production, and will provide updates to shareholders, stakeholders, and investors as to the status of operations at the Mine as they become available.
About Morien
Morien is a Nova Scotia based, mining development company created in 2012 to be a vehicle of direct prosperity for Nova Scotians, its largest shareholder group. Led by Nova Scotians, Morien’s primary assets are a royalty on the sale of coal from the Donkin Mine in Cape Breton, Nova Scotia, and a royalty on the sale of crushed stone from the permitted Black Point Quarry Project, in Guysborough County, Nova Scotia. Morien’s management team exercises ruthless discipline in managing both the assets and liabilities of the Company. The Company’s management and its Board of Directors consider shareholder returns to be paramount over corporate size, number or scale of assets and industry recognition. The Company has 51,292,000 issued and outstanding common shares and a fully diluted position of 54,192,000. Further information is available at www.MorienRes.com.
