I am quite happy to hear a few good news New Brunswick economic stories in the news lately.
The biggest announcement has been Potash Corp.’s announcement that they will build a new potash mine in Sussex, New Brunswick. This construction phase of this project has an estimated cost of $1.7 billion and is projected to create the equivalent of 2500 man hours of work as well as expand the ongoing mine workforce by 140 employees. The plan is that once completed, the new mine will replace the existing mine. Despite this the output from the mine will more than double from 800000 thousand tonnes to 2 million tonnes per year. This is good news not only for the Sussex area but impacts should be felt across southern New Brunswick from additional goods moving through the port of Saint John to additional work for engineering firms in Fredericton. The catch is that the provincial government has given Potash Corp a three year royalty holiday for potash and salt produced from the new shafts as well as a royalty reduction from 6.25% to 5.25% for potash and from 3.5% to 2.5% for salt for 5 years after the initial royalty holiday. Although some have complained that the province is giving up too much in royalties, overall this is still a very positive development. I would have to agree with David Campbell who would like to see incentives used to encourage value added manufacturing with the potash as opposed to simply shipping the raw potash offshore.
Another positive news story has been AV Group announcing expansion plans for its Atholville and Nackawic pulp mills. I recall seeing figures of $20 million but I can’t find any references and I can’t recall if that was for both mills or only for the Nackawic mill. I am a little worried by the tone of the CBC article covering the story as it implies that the company is trying to eek out more concessions from the government. This is after the provincial government put in a large amount of money when AV Group originally bought the mill in 2005. Hopefully the expansion will occur regardless of the provincial government involvement.
The base metals sector also seems to be getting some investment with ADEX Minerals announcing development plans for a tin and indium mine at its Mount Pleasant property in southwestern New Brunswick.
It is refreshing to see some good news in the New Brunswick economy. Hopefully we will soon see some good news for northern NB which has been have a terrible time with the forestry industries heavily impacted as well as increasing out migration.