Sullivan mine is carrot in Cominco union talks

As part of a deal to end the week- long strike at Cominco’s (TSE) Trail, B.C., smelter, the company has promised to spend $11.5 million to reopen the Sullivan lead-zinc mine in Kimberley, B.C. If the United Steelworkers of America’s bargaining unit ratifies the Cominco deal, workers could be back at the job within a few days, according to the local radio station KBS, July 18. The broadcast indicated a wage scale had been worked out, but did not provide details of the wage agreement. It said Cominco had agreed to reopen the Sullivan lead-zinc mine in stages.

Lead and zinc prices have been plummeting recently with the expectation that the 3,600 workers would be back at the job in the near future. This week, zinc dropped by almost US$200 to close at US$1522.50 a tonne on July 17 while lead fell by about US$70 to close at US$819.

Meanwhile, at Brunswick Mining and Smelting’s (TSE) lead-zinc mine in Bathurst, N.B., talks continue. According to union officials, one of the main issues is the practice of contracting out work to other companies. To resolve the wage issue, Brunswick has offered a 20% increase over three years as well as increased monthly pension payments.

Prices are likely to take another dive when a resolution is reached at Brunswick, said Victor Lazarovici, metals and minerals analyst for BBN James Capel, but the drop will probably be less dramatic than the decline experienced on the base metals markets this week. “I think people have been focusing more on the Cominco strike,” even though Brunswick is also a major lead- zinc producer, he said.

The Trail smelter produces about 5.8% of the western world’s refined zinc, and 2.6% of its lead. Brunswick’s mine accounts for another 5% of the western world’s zinc output and 1.5% of its lead.

Unless management came up with a new proposal for the Brunswick employees, about 540 workers from the Belledune smelter would join miners at the Brunswick picket lines, said Wendell MacCormack, a representative of the United Steelworkers of America, Local 7085.