If you felt a strong wind blowing through the streets of Princeton last week it just might have been the collective sighs of relief coming from Copper Mountain Mine and its more than 400 employees, following an aid announcement from the provincial government.
“We’re pretty happy,” said operations manager Don Strickland. “It’s pretty important for our site and I’m sure it’s very important for other mines in BC. Certainly our team has been hopeful the government would help out and that announcement last week was a positive indication. Now we need to find the details of it and move forward.”
Last Friday the BC government unveiled a five-year program allowing metal and coal mines to defer a significant portion of their energy bills.
Copper Mountain Mine spends $30 million a year on hydro.
“It’s now our second largest cost at the mine site next to labor” said Strickland. “The hydro rate has increased quite substantially since Copper Mountain made the decision to open operations and it’s a really big number for us. We’ve still got to pay the bill, but it’s a matter of when we pay it.”
Under the terms of the program mines can defer the equivalent of 75 per cent of two year’s worth of their hydro costs. In the case of Copper Mountain that equals a temporary reprieve on $44 million dollars.
Despite spiraling metal prices and the closure of mines around the province, Copper Mountain has so far managed to avoid lay offs or suspending operations.
“We’ve managed to keep our team together. There’s always a few people that leave and there is regular turn over but in terms of layoffs we’ve managed to keep our team together and that’s the objective we set last year,” said Strickland.
The government’s intervention means – barring a further plummet in copper prices – that Copper Mountain Mine will continue to operate as the town’s second largest employer.
“Certainly we expect that,” said Strickland. “It’s our intention to keep running at these copper prices and under the present economic conditions and now with additional support of government.”
The price of copper in December 2015 was $2.10 US per pound compared to a high of $4 per pound in 2012.
“We did a plan earlier this year to operate at $2.10 for copper and that’s what we need to do,” said Strickland.
Mining companies are encouraged to borrow before accessing the recently announced program. Companies with a low debt level will be assigned a 12 per cent interest rate for monies deferred, while others will pay approximately 8 per cent.
Strickland said Copper Mountain needs more information before it can accurately assess how it will use the program.
“Our team is certainly optimistic and looking forward to finding out the details. I think it’s positive for our team and for the Town of Princeton.”
In a press release from the Ministry of Energy and Mines minister Bill Bennett said: “Rural communities across BC depend on the high-paying jobs that their mines provide residents. We are in the midst of a challenging time for the sector and this will provide some temporary support to help the mines stay open as long as possible, hopefully until commodity prices bounce back.”
There are eight metal and five coal mines currently operating in BC, employing 7,500 people.