Let the good times roll
Northern B.C. mining boom means business for suppliers
1 of 2A.J. Forsyth's Kinetic K5000 Combination Hi Definition Plasma and Drilling Machine in Prince George cuts parts for a local fabricator. The parts will be used at the Mount Milligan copper/gold mine project. — Photo courtesy A.J. Forsyth
2 of 2Julie Umpherville, a drafting technician at A.J. Forsyth in Prince George, works on a laser-scanned image of a shovel bucket. She is designing a wear-resistant, custom-fit liner kit to help protect the shovel bucket. — Photo courtesy A.J. Forsyth
As a longtime employee of a major British Columbia steel distributor, Kevin McCormick has a unique perspective on the recent mining boom in the province's north.
Not only is he the manager of the Prince George branch of A.J. Forsyth, a division of mine industry supplier Russel Metals Inc., but McCormick is also a director of the Mining Suppliers Association of B.C. (MSABC). He's been working at A.J. Forsyth's Prince George branch for the past 19 years.
His company has had mining companies as customers since A.J. Forsyth was formed in 1908. But McCormick said that in the past seven or eight years, the demand for A.J. Forsyth's products from mining companies and other mining supply firms has increased dramatically, particularly at the Prince George branch. Traditionally the branch's business was slanted towards supplying the forestry industry; now, however, about 50 per cent is supplying mining companies and mining supply firms with products and services.
And that trend isn't isolated to just A.J. Forsyth among the area's mining supply companies, McCormick said. With approximately 27 new mines in either the permitting/environmental assessment stage or the advanced exploration stage in B.C.'s northeast, north central and northwest regions, he doesn't see an end to the current boom soon.
"I think honestly we have a good five- to 10-year run in the north of building," McCormick said. "And with those mines that are potentially going to be built, once they're operating, we could be looking at 20 or 30 years. You know, that's very comforting."
Responding to industry needs
McCormick explained his optimism about the regional mining supplier industry's future by relating his own company's experience. A significant part of A.J. Forsyth's business is supplying products and services for mine maintenance once mines are up and running.
It sells a lot of steel bars, steel plates and rebar to mining companies and mine supply firms along with several other products. It has also recently specialized in providing wear-resistant products for mining companies' equipment, such as custom-made steel plates to protect big-haul mining truck boxes.
Approximately seven or eight years ago, McCormick said, the Prince George branch began to notice an upswing in area mine activity. The Gibraltar copper/molybdenum mine near Williams Lake reopened due to higher copper prices in 2004, while milling operations at the nearby Mount Polley copper/gold mine restarted in 2005.
As well, the reopening of coal mines at Tumbler Ridge, northeast of Prince George, provided another shot in the arm.
"A decade ago, those mines weren't operating," McCormick said about the Tumbler Ridge operations. "They were closed. And now you're looking at—with Chetwynd included—four operating mines. So with just that alone that adds a lot of business for us."
Thinking like miners
But McCormick said A.J. Forsyth staff didn't just sit around and let an increase in area mining activity automatically generate more business. They made a concerted and successful effort to newly engage the industry.
First, the company joined the MSABC in 2005. McCormick said A.J. Forsyth needed to get to know the mining companies and mining supply companies better, as well as the people who operated them.
Second, the Prince George branch reorganized its sales team to better tap into a rapidly expanding market. In 2009, McCormick was placed into a new position with responsibility for helping sales representatives generate more mining and mining supplier business.
Third, the branch needed to invest in new mining-related equipment. In 2011 it purchased a new cutting table for $1 million, an item that lets employees work with larger, heavier steel plate.
Productivity products are key
As for new business opportunities that area mining suppliers may face as more mines open up, McCormick said closer relationships may trump offering new technological or "green" products and services.
"I think what the mines will need more than different, newer products is more stable supply," McCormick said. "They'll need suppliers that will partner with them."
That's largely because mining companies' needs are increasingly tied to mine maintenance, as pressure grows to increase production in a time of high prices.
There's also no doubt that demand is growing for new technological products and services that can help bring mines into the 21st century, and for new products and services that will help mines meet stricter and stricter environmental regulations. However, McCormick said, because A.J. Forsyth is a steel and metal distributor, he's not the best person to speak about firms offering such services.
“(But) I'm sure they're there,” he said. “I'm sure there are companies in Prince George that are helping with those problems.”
