$7.5 Million Dollar Fine for Cliffs Natural Resources General Partner

The mining world is global. ActLabs in Thunder Bay tests mineral samples from around the region and around the world
The mining world is global.

The mining world is global. ActLabs in Thunder Bay tests mineral samples from around the region and around the world
The mining world is global.

THUNDER BAY – BUSINESS – Cliffs Natural Resources has been hit with a $7.5 million fine. The company was hit with the fine because the company’s Bloom Lake General Partner plead guilty to releasing pollutants into fish-bearing waters in Quebec.

It is the largest fine ever imposed in Canada for an environmental penalty.

Bloom Lake General Partner Limited was ordered to pay $7.5 million in the Criminal and Penal Division of the Court of Quebec in Montreal today, after pleading guilty to 45 charges under the Fisheries Act, resulting from several incidents including the breach of a tailings pond dam

The charges related to infractions at the Bloom Lake mine site including releases of non-compliant mining effluent and of ferric sulfate into fish-bearing water, and failure to comply with an Inspector’s Direction. The sentence of $7.5 million is the largest penalty ever imposed for environmental infractions in Canada.

Of the $7.5 million, $6.83 million will be directed to the Environmental Damages Fund (EDF), representing the largest ever financial contribution to the Fund. The EDF follows the Polluter Pays Principle to help ensure that those who cause environmental damage or harm to wildlife take responsibility for their actions by supporting projects that benefit our natural environment.

On September 7, 2011, Environment Canada began an investigation into a number of infractions linked to the failure to take measures as directed, after an Inspector’s Direction was issued in 2010 for the Bloom Lake mine site. The investigation also covered other infractions which, over a period of four years, included major incidents such as the release of deleterious substances, as a result of the breach of the Triangle Tailings Pond dam and a separate release of 14,500 litres of ferric sulfate into water frequented by fish. During the investigation, information was found that indicated that on a number of occasions, the company did not inform the Department of releases, contrary to regulatory requirements and omitted to take samples and conduct analyses as required under the regulations.

Even one release of non-compliant effluent containing suspended solids, chemicals and/or high or low pH can negatively impact the water quality of the affected fish-bearing lakes, and is in violation of subsection 36(3) of the Fisheries Act.

The move is likely going to lead to Cliffs consolidating its corporate operations to the United States. In October, Cliffs notified the Government of Newfoundland that it would be closing Wabash Mines.

Shares (NYSE:CLF) in Cliffs have plunged 77% this year to below the $1 billion mark. That’s down from a $15 billion market value hit in 2011 at the height of the iron ore boom.