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NEWS: Harper’s $428 million gift to Vale

In April 2009, Vale Inco started constructing a nickel processing plant at Long Harbour in Newfoundland. The plant – to be completed in 2013 – will process nickel from the company’s operations in Voisey’s Bay and dump approximately 400,000 tonnes of tailings annually into Sandy Pond, a 30-hectare freshwater lake. This destruction of Sandy Pond is possible because of the ‘Schedule 2′ exemption in the Metal Mining Effluent Regulations of the federal Fisheries Act.

Russell Wangersky, the editorial page editor of the St. John’s Telegram, writes in The Western Star today that, “It’s been the mantra of the government of Premier Danny Williams for ages – no more giveaways.”

But he writes, “Take the case of Sandy Pond. Back in 2007, Vale Inco began looking seriously at construction of its hydromet plant. And part of the plan, from the very beginning, seems to have been that this province would agree to donate a lake to help cut costs. From the very beginning, the writing was on the wall for Sandy Pond. In the first set of environmental documents for Vale Inco’s planned nickel plant at Long Harbour, the decision was already, by all accounts, made.”

“Now, environmentally, using ponds for dumpsites should be a non-starter. The federal Fisheries Act proscribes charges for dumping ‘deleterious substances’ into fresh water, and killing close to 100 football fields of pond with acidic slop probably counts as dumping a deleterious substances. But economically, the federal government has allowed fresh water lakes and ponds to be a cheap tradeoff for companies that didn’t want to design and build holding areas for the waste they would produce. That’s a position that’s being fought in the courts by environmental groups (including the Sandy Pond Alliance, MiningWatch and the Council of Canadians).”

“In order to use Sandy Pond as a slurry dump, the company needed permission from both the federal and provincial governments – permission that was granted, with the provincial environment minister saying the move was a good balance between environmental protection and economic development. Maybe. But what’s a lake worth? …In this case, using Sandy Pond as a tailings pond was estimated to cost $62 million; a man-made containment area would have cost $490 million. That puts the market value of Sandy Pond at $428 million.”

“The additional $428 million would have been money invested here in the creation of a purpose-built, impermeable holding area specifically designed to hold acid-generating waste – as opposed to dumping it in an area that was designed not to hold waste, but to hold fish. Maybe, with the extra $428 million, the increased price tag for the whole project would have been too high, and the project would not have been viable.”

“Maybe this giveaway – of one pristine, 92-acre lake and $428 million in additional construction work that would have to be done in this province – was the only way. It is a pretty steep price tag, both financially and environmentally. Let’s not do this again.”

The Council of Canadians does not believe in putting a price tag on a lake. But Mr. Wangersky makes a good point about how much money the Harper and Williams’ governments essentially gaveaway to Vale by allowing the destruction of Sandy Pond. Could Vale have afforded the additional $428 million for the holding area? In that Vale Inco made $4.2 billion in profits in 2007-08, and has $21 billion in current assets, we would suggest that the answer is yes. But it was more profitable for this transnational corporation to destroy a lake than to construct a holding area – and our governments are allowing this to proceed.

For Council of Canadians campaign information to stop the destruction of Sandy Pond, please go to http://canadians.org/water/issues/TIAs/sandy-pond.html.

Mr. Wangersky’s column is at http://www.thewesternstar.com/index.cfm?sid=346367&sc=27.