Davos World Economic Forum – Four companies invest over $210 million in Quebec

DAVOS, Switzerland, January 24, 2018 /CNW Telbec/ – Canadian Electrolytic Zinc Limited (CEZinc)/Noranda Income Fund, ArcelorMittal Long Products Canada, IBM Bromont and Goldcorp will have invested a total of $210.4 million in Quebec by 2020. The four announced projects involve major sectors in Quebec’s economy and will contribute to the economic development of several regions.

Announced in parallel with the Davos World Economic Forum, these investments were made possible by the Electricity discount program for consumers billed at Rate L, which was announced by the Quebec government in the 2016-2017 budget. This program builds on the clean and reliable energy that is produced in great quantities in Quebec in order to accelerate the implementation of important investment projects by companies in the manufacturing and natural resource processing sectors.

The announced investments are as follows¹:

Canadian Electrolytic Zinc Limited CEZinc/Noranda Income Fund: $118.3 million

ArcelorMittal Long Products Canada: $70 million

IBM Bromont: $11.9 million

Goldcorp: $10.2 million

1. See the descriptions of the companies and investment projects in the appendix.

Quotes: 

Innovative manufacturing is one of the three economic pillars of our government, along with entrepreneurship and exports. As a result, we are proud to support the initiatives of four large Quebec-based companies that are making major investments in order to undertake innovative projects and implement new technologies to optimize their manufacturing processes and procedures. Innovation and modernization are synonymous with corporate growth and represent effective drivers of Québec’s prosperity.

– Dominique Anglade, Deputy Premier, Minister of Economy, Science and Innovation, and Minister responsible for the Digital Strategy

Thanks to a stable business environment, recognized expertise in several cutting-edge fields, and an abundance of natural resources, Quebec is a great place to invest. The projects announced today clearly demonstrate these companies’ interest in expanding their activities here. The confirmation of these strategic investments will strengthen and diversify the economy of several Quebec regions.

– Carlos J. Leitão, Minister of Finance 

Key facts:

• The Electricity discount program for consumers billed at Rate L has the following objectives: the enhancement of productivity or energy efficiency through the modernization of operating procedures; the conversion of production processes to adapt existing products to market demand; and increased output to adapt supply to market demand.
• The assistance paid in the context of this program allows for the reimbursement of up to 50% of the eligible costs, or the reimbursement of 40% of the eligible costs incurred and the additional reimbursement of up to 10% of the eligible costs incurred for projects aimed at greenhouse gas (GHG) emission intensity reductions. The maximum reduction of the electricity bill is 20% for a maximum period of four years.

APPENDIX

CEZinc/Noranda Income Fund

CEZinc, a wholly-owned subsidiary of Glencore Canada Corporation, operates and manages the zinc processing facility located in Salaberry-de-Valleyfield, Quebec. This processing facility is owned by the Noranda Income Fund, an income trust of which 75% is held by the public and 25% is indirectly held by Glencore Canada Corporation. The trust trades on the TSX under the symbol “NIF.UN”. The CEZinc processing facility is the second-largest zinc processing facility in North America and the largest zinc processing facility in eastern North America, where the majority of zinc customers are located. It produces refined zinc metal and various by-products from sourced zinc concentrates.

The company’s investment projects will be implemented in its Salaberry-de-Valleyfield plant, and will allow for:

• The optimization of several pieces of equipment at the acid plants and roasting facilities;
• Reduced zinc dust consumption through investment in hydro-metallurgy reservoir mixing and supply and measuring systems;
• Increased cooling capacity in the electrolysis circuit;
• The implementation of other projects, particularly to ensure the reliability of electrical infrastructure.

Potential electricity discount: $47.3 million

ArcelorMittal

ArcelorMittal Long Products Canada manufactures sustainable steel in accordance with its values of health and safety, quality, leadership and sustainability. The company employs about 1,500 people in Contrecoeur, Longueuil and Montréal, and approximately 200 people in Hamilton. It operates a scrap-metal recycling and conversion centre, an iron-ore reduction plant, two steel mills, three rolling mills and two wire drawing mills. The group has an annual production capacity of over 2 million tonnes of steel and generates economic spinoffs of more than $1 billion per year. ArcelorMittal Long Products Canada is part of ArcelorMittal, the world’s leading integrated steel and mining company, with a presence in more than 60 countries.

The company’s major investments will take place in its Contrecoeur steel manufacturing facilities, thus enabling it to maintain its leading position in the North American steel industry by focusing on product quality through modernized plants and a reduced environmental footprint.

ArcelorMittal will replace two reheating furnaces, one in the Contrecoeur-Est rod rolling mill and one in the Contrecoeur-Ouest bar mill. These new furnaces, which are designed to increase the company’s rolling capacity by 100,000 tonnes, will lead to greater productivity, optimal energy use and reduced GHG emissions.

At the same time, the company will also be replacing the Contrecoeur-Ouest steel mill’s dust collector to improve its performance and increase health and safety for workers and communities.

Potential electricity discount: $25 million

IBM Bromont

The IBM Bromont plant transforms the world’s most advanced semiconductors into state-of-the-art microelectronic components that are used in the entire line of IBM systems as well as in a wide range of products produced by our external customers. Opened in 1972, the Bromont plant is IBM’s largest semiconductor testing and assembly facility in the world, and the only IBM plant in Canada.

Every system made by IBM contains at least one part from the Bromont plant.

The company will undertake roughly ten projects:

• Upgrade of IT infrastructure;
• Installation of a new probe production line;
• Improved automation of Bromont plant;
• Increased production at IBM Systems division.

Potential electricity discount: $2.8 million

Goldcorp

Goldcorp is a leader in gold production that focuses on responsible mining practices. The company has secure facilities throughout the Americas that distinguish themselves by their low operating costs.

The projects, which amount to $10.2 million, include:

• The purchase of a drill;
• The installation of a copper sulphate adding system;
• The purchase of three trucks;
• The purchase of a scooptram.

Potential electricity discount: $4.8 million