Minister responds to comments in The Telegram

Charles Furey, Minister of Mines and Energy, issued the following statement today in response to the article "Wrong Numbers: VBNC says mining consultant used `outdated' figures in support of smelter deal" published in the December 4 edition of The Telegram:

It is important to note that the Government of Newfoundland and Labrador did not commission this study. Brook Hunt is a highly respected and independent mineral industry analyst that undertakes an in-depth analysis of the world-wide nickel industry annually. Their analysis is used globally by the mineral industry and mining analysts as one of the benchmark for how the industry is performing and how it will unfold.

I am disappointed that VBNC has chosen to question the reputation of such an internationally renowned industry expert. This is a company that has over 20 years of experience in reporting on the nickel industry and who, by all accounts, is above reproach when it comes to fairly representing the facts about specific projects and the nickel industry as a whole.

VBNC has stated that Brook Hunt has used outdated figures in their 1998 analysis of the Voisey's Bay project. We have reviewed the Brook Hunt analysis and while they have indeed noted that the costs for Voisey's Bay have changed, they have chosen not to employ them in the 1998 analysis. Brook Hunt has excluded the revised costs for the same reason that we have not employed the VBNC cost estimates in our analysis; the costs do not accurately represent a plausible estimate of what this project will reasonably cost.

VBNC has also challenged Brook Hunt's estimate of long-term prices for the by-products from the Voisey's Bay mine. Without providing a supporting rationale, VBNC has dismissed outright the Brook Hunt forecast for metal prices. Brook Hunt's expert opinion on the future of metals prices is as valid as VBNC's or any other industry player.

We would like to see this project proceed. However, our own analysis is similar to Brook Hunt in that we both concluded the project can support a smelter/refinery in the province.

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