The long-awaited potash mine at Kronau is in limbo once again, with Valet Potash putting the project on hold.
The Brazilian mining company announced the decision to suspend work on the mine in a public letter to the local community.
Valet says the recent feasibility still shows a compelling case for a mine in Kronau someday, but market conditions make it difficult to finance the project right now.
Matthew Wood is the senior project leader at Vale for the Kronau project.
“It’s still a very promising project with the economics and everything, there just isn’t an opportunity to start any new construction next year,” he said.
The $3.5 billion mining project was projected to create 2,000 construction jobs and 350 permanent jobs.
The mining giant currently operates with a team of about 30 people in Saskatchewan.
“We’re just sort of evaluating what we can do with those staff, whether we can re-assign them other places, whether we can find other opportunities for them,” Wood explained.
He said a much smaller core team of people will remain in the province to maintain the land holdings along with government and community relations. There is no word specifically on how many people that will be.
Wood said the project is still very strategic for the company in the long-term, but the timeline to restart is dependent on market value.
Erwin Beitel is the reeve of the R.M. of Lajord which covers the communities of Kronau, Riceton, Gray and Davin.
“Once they get going, then it’s going to help the surrounding towns with potash royalties and now everything’s put on hold,” he said.
He says the company told leaders in the community several weeks ago that the project will be paused. He says they have no idea what the timeframe will be to start back up again, but he’s optimistic that it will.
“It’s just going to be a wait and see situation and who knows, in two years, four years, 10 years – they’ll come out. This has been suspended before and then started up again,” he said.
Beitel says nobody lost jobs in the local community because the work hadn’t really started on the site yet. In fact, the land is still being farmed.
“There’s really no workforce that was out there at all, it’s just sitting in limbo for now,” he said.
Vale is maintaining land holdings in the area and will be keeping watch on the mineral assets and the land in a caretaker role. The company owns