Sherritt International Corp T.S

Fort (non) expansion.

[FrozenInOntario]

One point that did not get a lot of attention from this forum : Sherritt will not to invest in the Fort smelter to refine the totality Moa increased production.    Instead, any excess concentrate will be sold on the market.
When you think about it, sending concentrate from Moa to Halifax and railed to Alberta is quite costly.   Of course, if they could ship it to Thunder Bay, it would decrease the costs materially but then, they can’t while there are US sanctions.  Anyway, if they had to build this smelter today, pretty sure they would not locate it in Alberta but probably on the East Coast.
All this to say that by not investing on the smelter, it shows that Binedell has pretty good common sense by not increasing additional capital spending for no risk adjusted return. 
What will be his next move ?   
 
GLTA

[Albatross]

Well transport cost is just 1 of the costs... what about cost of natural gas (ways cheaper in Alberta) what about access to cheap sulfur (main component of the refining). There's mounds of it in Alberta from the upgrading and refining of heavy oil.  what about selling fertilizer to local markets? Alberta and Sask are huge markets for fertilizer.  you can't just look at

[VerificateASAP]

This post has been removed in accordance with Community Policy

[rkhosla]

ding ding ding ding!  correct on all counts

[NorthVan77]

Pathe always spoke of the transport costs to Fort Saskatchewan as being fairly insignificant.  In addition to key inputs being available in Alberta much of their product ships to Asia so it need to pass Alberta one way or another.  The main reason the plant was built there in the first place was because of widely available NG and sulpher.

[rkhosla]

Right - all that cheap halifax natural gas? The smelter belongs in Louisiana where it was in the beginning... but that's another story...  Just across the pond from Cuba