NEWS

Cliffs looking for 'exit options' for Quebec iron ore mine

11/19/2014 09:54 EST | Updated 01/19/2015 05:59 EST
U.S.-based Cliffs Natural Resources, which is already shutting down Wabush Mines in western Labrador, said Thursday it is now looking at a similar scenario for a costly iron ore mine on the Quebec side of the border.

The Cleveland-based company said it "is pursuing exit options" for its eastern Canadian operations, "which may result in the closure of the Bloom Lake mine."

Cliffs bought the the Bloom Lake project from Consolidated Thompson as part of a $4.9-billion deal in 2011, during a boom in iron ore prices.

Since losing interest in the project, Cliffs — which has been under intense pressure from activist shareholders — has been unable to find anyone willing to shoulder the cost of taking over.

"Despite the continued interest of the prospective equity partners in Bloom Lake and in its high quality ore, the potential investment is not achievable within a time frame acceptable to Cliffs," president and CEO Lourenco Goncalves said in a statement.

Closing the mine will not be cheap. The company said the closure costs over the next five years could run between US $650 million and $700 million.

Cliffs idled the aging Wabush Mines last winter, and earlier this fall informed the Newfoundland and Labrador government that it intends to close the mine altogether.

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