Sydney Steel Corporation Sale Act Introduced
Nova Scotia will be out of the steel business for good with the passage of the Sydney Steel Corporation Sale Act, introduced today by Economic Development Minister Gordon Balser.
"We are ending 33 years of government involvement in the steel industry," said the minister. "This marks a better future for steelworkers and a new chapter for the local economy of Cape Breton. It is good news for all Nova Scotians."
In June, the government signed an agreement with Duferco Steel Nova Scotia Corporation to take over ownership of Sysco.
The legislation also establishes the Sydney Steel Superannuation Fund, which will provide pensions for eligible steelworkers.
"We have been fair to steelworkers in our efforts to privatize the industry," said the minister. "At the same time we have met our commitment to taxpayers of the province."
The provincial government reached a new pension and severance agreement with the United Steelworkers of America during the second week in October. The agreement was endorsed by 85 per cent of the union membership at Sydney Steel. It ensures that every steelworker will receive a good pension, an appropriate severance or a job with Duferco.
Another milestone was reached yesterday when the union membership voted to accept the terms of a collective agreement with Duferco.
Duferco plans to employ approximately 215 people, both salaried and hourly, during the first phase of operations, which will see operation of the steel melt shop to produce 750,000 tonnes of steel slab for the company's mill in Farrell, Pa.
Phases two and three involve increased levels of production including use of the blooming/breakdown mill to produce steel plates and the construction of a facility to produce hot briquetted iron. The construction of this facility will involve an investment of $120 million. If all three phases are achieved, there is potential for up to 400 jobs at the plant.
"Duferco has a proven track record of turning steel companies around and providing good and lasting jobs," said the minister. "They have a strong business plan, a solid financial and operational track record and no requirement for new taxpayer funding."
Duferco was founded in 1979. It is headquartered in Switzerland and operates in 38 countries worldwide. The company's main areas of activity are steel trading, steel production--both flat and long products--and related specialized services.
The company has invested capital of about $500 million (US) in its steel-making operations in the United States, Belgium, Italy, South Africa and Macedonia. For the fiscal year ending 1999, Duferco had annual sales totalling $2.1 billion (US) and equity of $256 million (US).
In its 30-year history, Sysco has cost taxpayers about $3 billion. Efforts to privatize the Crown corporation have been under way since 1992.