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Sherritt International Corp. is shutting down operations at its refinery in Fort Saskatchewan, Alta., after running out of the feed inventory it receives from its Moa mine in Cuba.
The company says the shutdown will continue until mining and processing activities at Moa resume and the refinery feed pipeline is rebuilt. It also says no jobs were lost due to the operational challenges.
“Sherritt is continuing to work on a path to rebuild the pipeline of feed as soon as practicable,” a company spokesperson told CBC News.
“In the meantime, the refinery is continuing to produce fertilizers and sulphuric acid for resale and there are plans in place for maintenance activities that will fully utilize Sherritt’s Alberta workforce.”
Operations at Sherritt’s Moa joint venture in Cuba were paused earlier this year as the country faced fuel shortages since the U.S. cut off access to oil from Venezuela in January.
Colin Fagan, with the chamber of commerce in Fort Saskatchewan, said Alberta’s Industrial Heartland has seen its fair share of hurdles in recent years.
“The last 10 years have been challenging with lots of economic forces that are outside the control of our region, sometimes outside the control of our borders,” he told CBC News on Friday.
According to Sherritt’s website, before the pause, the company’s joint venture saw ore be mined and processed into mixed sulphide precipitate containing nickel and cobalt, which was then transported to the refining facilities in Alberta.
The Sherritt refinery is one of the oldest processing projects in North America, said Richard Hiller, the future materials alliance director with the Energy Futures Lab.
“It’s the only one that’s producing battery grade cobalt in North America,” he said. “It’s a pretty strategic asset at a time when everybody’s tripping over themselves to develop new projects and grow the sector bigger. “
The refinery shutdown comes as the company says it’s in talks with its lenders, but that it would be unable to repay all or a material portion of its debt if it becomes due earlier than its stated maturity as a result of an acceleration by one or more of its creditors. It says its ability to refinance or extend its debt under the current circumstances remains uncertain.
Sherritt has signed a non-binding agreement with Gillon Capital LLC, a family office of a former Trump administration adviser, that would allow Gillon to buy a majority stake in the company.
The Canadian miner has said that a preliminary private placement deal would see Gillon hold a warrant that would allow it to buy enough shares to give it a 55 per cent stake in the company.
According to its website, Sherritt’s refinery facilities in Fort Saskatchewan have an annual combined production capacity of about 38,200 tonnes of nickel and cobalt.