Kathleen Ruff op-ed: “Sordid asbestos tale could be nearing its end”

Toronto Star, August 10, 2012

It seems every day a new bomb drops, showing the utter insanity of the plan to revive Quebec’s bankrupt asbestos industry — a plan Premier Jean Charest and Prime Minister Stephen Harper doggedly support.

The project to revive the Jeffrey mine at Asbestos, Que., has been condemned as medically indefensible by Quebec government health authorities, the Canadian Cancer Society and the Quebec Medical Association.

Not only is the project a health disaster, however; it is also a financial calamity.

The cost to make the Jeffrey underground mine operational is $83 million. After years of trying, Bernard Coulombe, president of Jeffrey Mine, failed to find any investors willing to put up the money.

Finally, in October 2010, a consortium of Indian investors led by Montreal asbestos trader Baljit Singh Chadha offered to purchase the Jeffrey Mine on condition the Quebec government provide a loan guarantee to cover 70 per cent of the cost ($58 million). Chadha said it was urgent that the project go ahead immediately.

Six months later, however, Chadha had still failed to raise his $25 million and the project was on the verge of collapse. To save it, the Charest government announced approval of the $58 million loan guarantee in April 2011, saying this would inspire confidence in private investors.

Incredibly, 14 months after the Quebec government guaranteed the loan, no financial institution would touch the project.

Facing this calamitous situation, at 4 p.m. on Friday, June 29, before a long holiday weekend, the Quebec government announced it would go where financial institutions refused to tread and provide the $58 million loan.

The financial problems were still not over, though. All the original Indian investors who had offered to buy Jeffrey Mine in November 2010 had now bailed out.

The new owner of Jeffrey mine is Mineral Fibre Inc., a company with two shareholders — Chadha and Coulombe — who have exported Jeffrey mine asbestos to developing countries for the past two decades. They put up $11 million. They could find only one investor — a Thai company, Ulan Marketing — to put up $14 million to reach the required $25 million.

Ulan is part of the Oran Vanich family of companies, a longtime customer of Jeffrey Mine that sells asbestos-cement roofing in Thailand.

However, in April 2011 the government of Thailand approved a resolution called “Measures to Make Thai Society Free from Asbestos.” A schedule to end the import of asbestos and protect the population from asbestos harm is being developed.

Oran Vanich is fighting to defeat the ban, arguing that “so far it has not been proved that asbestos causes death.”

Thailand has one of the highest per capita levels of asbestos use in the world. Studies show Thai workers are exposed to appallingly high levels of asbestos fibres.

Even if Harper and Charest are indifferent to protection of health overseas, one would think they would recognize the unsound financial basis of Quebec taxpayers carrying 70 per cent of the risk of a project, shunned by private investors, except one discredited company in a country about to ban asbestos.

Both Charest and Harper see the people of Asbestos as political pawns. Harper went to this town of 7,000 people twice during the last election campaign to swear his undying allegiance to the asbestos industry as a gambit to win the riding. Charest is trying the same political gambit by giving the $58 million loan just prior to the Quebec election.

The people of the town of Asbestos and Quebec taxpayers deserve better than this.

The Parti Québécois condemned the loan, saying that asbestos is a dying industry that offers no future to the region and that funds should instead go toward economic diversification. The left-wing Québec Solidaire criticized Charest on health grounds and for misuse of public funds.

François Legault, leader of the right-wing Coalition avenir Québec, denounced the loan as an election ploy and a gift to a friend, saying it made Quebec look like an amateur in international trade. Chadha is a personal friend and fundraiser for Charest. Legault has now called for an end to asbestos mining because of its health hazards.

The political tide is turning against asbestos in Quebec. If Charest loses the election, the plan to revive the Quebec asbestos industry may be stopped in its tracks.


Kathleen Ruff is author of Exporting Harm: How Canada Markets Asbestos to the Developing World. She is senior human rights adviser to the Rideau Institute

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