Ideas needed
Will municipalities support projects?

Dane Gibson
Northern News Services

NNSL (Sep 27/99) - Any infrastructure plan created to keep Giant workers in the North must have the support of the NWT communities.

Ile Royale consultant David Connelly was hired by the Canadian Autoworkers Local 2304 to find ways to keep workers employed until Diavik and other proposed mining projects become operational.
Impacts of Giant Mine closure on the NWT

Impact on federal government:

- $2 million loss in corporate taxes and royalties

- $5 million loss in personal taxes

Total loss: $7 million

Impact on territorial government:

- $30 million loss in taxed labour income

- $15 million loss in federal transfer payments

- $13 million net revenue loss by 2002

- $2 million loss in corporate territorial taxes

- $1.5 million loss in personal taxes

Total loss: $61.5 million

Impact on businesses:

- $38 million in gross domestic product

- $29 million loss in gross operating expenditures

- $7.5 million loss in labour income

- Total employment loss in Yellowknife of 404 jobs

Total loss: $74.5 million

NWT Power Corporation:

- $4.7 million loss in expenditures from Giant

Giant Mine employees:

- 80 per cent of households surveyed will leave the NWT

Figures taken from NWT Chamber of Commerce Brief #15:99 - September 23, 1999

The hope is that the NWT will be able to absorb the trained Giant workers that are already here, thereby giving them an option other than going south.

Connelly said a number of interest groups contacted to date have suggested infrastructure projects could benefit the NWT while creating immediate jobs.

"One of the uncertainties is we don't know if the communities will be supportive of an infrastructure investment in Yellowknife," Connelly said.

"We need to find out what the impact of a Giant closure on the rest of the NWT communities will be."

To do that, a questionnaire was prepared by the NWT Chamber of Commerce that will be sent to the mayors of each NWT community and to over 100 members of the NWT Chamber of Commerce.

The purpose of the questionnaire is to gauge whether or not the bankruptcy of Giant Mine/Royal Oak will impact business in other NWT communities.

It also asks other communities to consider if it would be appropriate to seek funding for infrastructure investment(s) to offset the effects of the Giant bankruptcy.

"Such projects could include a convention centre, mine clean up, lengthening of the (Yellowknife Airport) runway, and acceleration of the road from Rae to Yellowknife," the questionnaire states.

There are more than 20 comprehensive questions on the form. NWT Association of Municipalities (NWTAM) president George Roach responded cautiously when asked about the questionnaire.

"The NWTAM is aware of the issues facing Yellowknife and we are sympathetic, but we represent all communities in the NWT and there are difficulties occurring in many of them," Roach said.

Roach is also the mayor of Inuvik, a town that in the past 15 years has weathered the closing of a major military base and the pull out of a vibrant oil and gas sector.

"Certainly we feel for Yellowknife, but many communities have suffered trauma. Inuvik has been through 15 years of downturns and cutbacks and we're not crying," Roach said.

He tempered his comments by adding that he has no doubt everyone in the territory will pull together in this trying time to support viable make-work projects.

"We will support positive ideas but we also have to remember other communities are suffering hard times too," Roach said.

"We don't want to see all the bail out resources allocated to Yellowknife. There will be hard times, but they'll certainly come out of it."

Connelly pointed out that infrastructure projects are just one idea to create jobs. He said they are looking for creative input from anyone who may have a suggestion on how to keep workers employed.

"At this point, we will consider any constructive idea which helps offset the impact of the Giant closure until the Diavik mine comes online," Connelly said.

Meanwhile, interim receiver PricewaterhouseCoopers filed their 14th report on Royal Oak Mines Inc. in court on Friday. Here are some of the highlights:

  • The receiver reported that the Miramar Mining Corp. offer contemplates the closure of Giant mine, "although some underground mining operations may be recommenced in the future."

  • The receivers operated the mine from July 26 to Aug. 29, 1999. Cash losses during that time, which were funded by the main creditor, Trilon, and the noteholders, were in excess of $100,000 per week.

  • The sale of Giant mine to Miramar Mining Corp. on a shut-down basis "represents the best economic solution available to the interim receiver."

  • The Miramar offer has certain environmental advantages as Miramar has advised "it has no intention of re-opening the operations at Giant which give rise to the hazardous arsenic trioxide by-product."

  • All current employees at Giant will be paid outstanding wages and vacation pay to the date of their termination. Each employee will be given instructions on how to file a proof of claim in respect to severance and termination pay they may be entitled to under the Labour Standards Act of the NWT.


  • "Immediately proceed with the closure of the Giant mine."

  • "Proceed with the negotiaion of the sale of the Giant mine to Miramar, subject to the further approval of the terms and conditions by the court."