British Columbia's Environmental Regulation Uncertainty Jeopardizes $140 Million Graymont Lime Project

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Researched by Industrial Info Resources (Sugar Land, Texas)--Because of uncertainties with the British Columbian government's climate action plan, Graymont Incorporated (Richmond, British Columbia) has put the skids on its proposed $140 million limestone quarry and processing plant in Giscome, British Colombia. The company pulled out of the environmental assessment process because of concerns about the province's regulatory approach on greenhouse gases and halted the public consultation process, as well. This action has virtually put the project on hold indefinitely.

Although the proposed Giscome lime plant would use the most energy-efficient lime kiln technology in the world and be able to utilize alternative fuel sources, it's the uncertainty around the province's approach to greenhouse gas regulation that has caused the serious concerns in advancing with the project. Graymont believes that this project is the right thing to do from an environmental, greenhouse gas and business viewpoint. The company will continue to work with the province to find a resolution to this issue that will allow all parties to meet their goals.

The project was laid out in two phases. The first phase, expected to cost about $90 million, would produce approximately 600,000 tons a year with an initial annual lime production rate from one kiln of approximately 200,000 tons. If good market conditions prevailed, Graymont could expand the capacity of the Giscome operation with Phase II, which would cost an additional $40 million. The limestone extraction rate could increase to 1.2 million tons per year with an annual lime production rate from two kilns of 400,000 tons. The life of the mine could exceed 25 years based on drilling samples and current market demand.

The proposed limestone quarry would be accessed by a haul road, the route of which was being evaluated. The proposed project would produce high-quality lime products to be used in environmental and industrial applications, as well as limestone products to be used as general construction stone. The location is considered ideal not only because of its nearness to the Canadian National Railway but because of the presence of the abundant high-quality limestone deposits.

In August, some of the finer points in regard to the regulatory standards on greenhouse gases should be expanded on when British Columbia makes a Cap and Trade plan public. It's not currently known how much time it will take to finalize the plan. The province is part of the Western Climate Initiative, a consortium that is working to resolve some of the issues. It's the Cap and Trade system that remains one of the outstanding issues for Graymont. It is not ready to move forward with the project without knowing the environmental regulations.

Graymont is a privately owned company committed to responsibly meeting needs for mineral products. Graymont has been in the lime and limestone business for more than 50 years. It is considered the largest lime producer in Canada and the third-largest lime producer in North America.

Cap and Trade: A flexible environmental regulation mechanism that sets an overall limit on the emission of a certain pollutant but allows companies that can easily reduce emissions to sell credits to other companies for which such reduction would be difficult. The cap ensures that emissions will not exceed a desired amount.

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