Idled Canadian iron ore mine charged with $30K fine over pollution

Wabush Mines, an iron ore operation in Canada’s western Labrador that has been shut since 2014, will have to pay a Cdn$30,000 (about $22K) fine for polluting the environment, a Newfoundland and Labrador provincial court has ruled.

The verdict follows the company’s guilty plea last week to offences including failing to perform acute-lethality sampling of effluent and failing to notify an inspector following a deposit out of the normal course of events.

Before it closed in 2014, Wabush Mines was Canada's third largest iron ore operation, with an annual capacity of 6 million tonnes.

In practical terms, that means Wabush Mines didn’t test the mine’s surroundings to determine whether there was any amount of waste being released that could harm rainbow trout. The company also failed to let an inspector know there was an unusual amount of deposit. All this happened in May 2015.

The majority of the fine, $25,000, will go to the federal Environmental Damages Fund, and the company's name will be added to the Environmental Offenders Registry.

Before it closed, Wabush Mines was Canada's third largest iron ore operation, with an annual capacity of 6 million tonnes. Mining there began in 1965, at the Scully Mine, with iron concentrate railed to a pelletizing facility in Pointe Noire, Quebec, for shipment to Europe and throughout North America.

The 2014 closure devastated Western Labrador’s economy. Housing prices plummeted, businesses closed and pensioners were left to fend for themselves.

Earlier this year, the gloom and doom over the small mining town of Wabush was temporarily lifted, when it was revealed that an American buyer, Virginia-based ERP Compliant Fuels, had submitted a bid to owner Cliffs Natural Resources (NYSE:CLF).

Hopes quickly faded away, as ERP decided in May not to proceed with the transaction. This despite iron ore prices staging one of the year's biggest turnarounds mainly on the back of increased Chinese demand for the steel-making ingredient.

Benchmark iron ore prices more than doubled this year from under $40 a tonne in early 2016 to above $80 this week, yet there have been no clear signs of interest in resuming operations at Wabush Mines, which assets are set to be liquidated.