Doug Ashbury
Northern News Services

NNSL (Sep 15/99) - A Giant Mine shutdown would shrink the Government of the Northwest Territories' revenue by several million dollars, GNWT Finance Minister Charles Dent said.

"Our best guess, is $12 million to $13 million would be the total impact on our transfer payments (based on 265 job losses at Giant)," Dent said.

The finance minister said prior to Royal Oak Mines, the company which owned Giant Mine, going into receivership, he wanted to know what the effect of a total Giant shutdown would be on GNWT revenues.

Royal Oak interim receiver PricewaterhouseCoopers has given Giant mine workers until Sept. 22 to come up with a rescue plan. Con mine owner Miramar Mining plans to buy Giant, shutdown its mill and process its ore at Con.

Dent said the multi-million dollar figure was based not only on the direct job losses but also indirect factors like 265 families leaving the NWT. The GNWT also considered indirect job losses GNWT tax losses.

Miramar Mining, which plans to buy Giant mine, said last week it could hire back 50 of the current 280 Giant workers.

When it comes to federal transfer payments, population is the major variable. When the NWT's population drops by one person, that translates into a $12,000 to $15,000 revenue loss.

Money from Ottawa makes up the lion's share of the territorial revenue. In fiscal 1999/2000, the GNWT estimates it will receive $571.6 million of its total revenues of $708.3 million from the federal government.

The scenario for taxes is far less dramatic. When the GNWT loses a dollar in tax, Ottawa raises the transfer payment 80 cents.

Mike Vaydik, NWT Chamber of Mines general manager, said if the NWT is to continue to have a mining sector exploration is a key.

"Mines do close. For mining to be sustained we need a sustainable exploration program.

"With stock markets they way they are, it makes it difficult for companies to raise capital for exploration," he said.

Vaydik also said: "We need some new mines and we need to get on with permitting ones we've found."

Canadian Autoworkers Local 2304 President Marc Danis said last the union believes Giant is still a viable mine.

While Royal Oak was building its Kemess South mine, there was little work done to expand Giant's ore reserves, he adds.