History of Company Operations

Caland Ore Co. Ltd. was formed in 1949 as a wholly-owned subsidiary of Inland Steel Company of Chicago. On January 1, 1953, Caland signed a 99-year lease with Steep Rock Iron Mines which permitted Caland to proceed with the development and mining of the "C" orebody. This property would provide high grade iron ore for the Inland Steel Co. furnaces at Indiana Harbour, Indiana. The lease called for Caland to produce 750,000 tons of ore in 1960, with a gradual increase to higher tonnages in subsequent years. The deposit is located at Falls Bay of Steep Rock Lake, about five miles north of Atikokan, Ontario. Atikokan is about 125 miles west of the Canadian Lakehead city of Thunder Bay.

During the 7-year period after the signing of the lease and prior to the first ore shipments in 1960, a tremendous amount of development work had to be completed to maintain the schedule. The orebody was overlain by silt to an average depth of 300 feet plus 100 feet of water. A dredging contract was let to Construction Aggregates Corporation (CAC) of Chicago in 1953 for the removal of an estimated 160 million cubic yards of lake bottom material. Two 36-inch suction dredges were assembled at the site along with pipelines, booster stations and other shore facilities. The pumping began in March 1955 and was completed on September 30, 1960 when 162 million cubic yards of lake bottom material had been removed. The bulk of the material was pumped a distance of four miles to the Marmion Lake disposal basin.

Another phase of the development work, carried out simultaneously with the dredging operation, was the construction of water control facilities to divert and pump run-off water from a 25 square mile drainage area surrounding the mine site. At the mouth of the South East Arm of Steep Rock Lake the Fairweather Dam was constructed to impound the run-off from an additional three square miles of drainage area and to provide a railroad crossing over the old lake bottom.

To the north of the mine site, the Grossman Dam, a 25-foot high concrete structure with four sluice gates, was constructed to provide control over the amount of recharge water returned from Marmion Lake to the dredge pool. With the completion of the dredging this dam impounded run-off water from the North and South Twin Lakes catchment areas and diverted it northward to Marmion Lake. This water would otherwise have run southward to the mining zone.

As dredging lowered the water in Falls Bay, construction went ahead on the ore handling facilities. In 1957, a conveyor system running from the Lime Point Mine at the north end of the ore zone to the railroad loading plant was constructed. The lower end of this system was relocated in the winter of 1963-64 to bring it closer to the actual mining operations in the main or central part of the ore zone.

An underground 8-compartment shaft called the "Falls Point Shaft" was sunk to a depth of 1330 feet in the footwall granite. The sinking was completed in 1958. Although the underground mining operations were deferred indefinitely in 1961, the shaft and skip hoists were used as part of a unique transportation system for handling ore from the open pit.

In 1959, Caland initiated an open pit mining operation in the Lime Point area at the north end of the ore zone. It was natural that this part of the orebody would be the first mined because it was the highest in elevation and consequently the first to be exposed by the dredging. On May 3, 1960, initial shipments of ore were made from the Lime Point Open Pit Mine. Technological developments in open pit ore moving equipment during recent years have made this type of mining more economical than underground removal and in 1971 the underground facilities were permanently abandoned.

In 1964, the Company awarded contracts for the construction of an ore processing and pelletizing plant which became operational in 1965. The plant was designed to process 2.5 million tons of high grade ore per year. Over a period of several years, Caland spent well over one million dollars in capital and operating costs in regards to additional environmental improvements. The addition of the ore preparation and pelletizing plant was an outgrowth of the steel mills demand for ores with improved physical characteristics.

A total of over 80 million dollars was spend in exploration, development, plant and equipment. In addition, Caland has paid over 70 million dollars to Steep Rock Iron Mines in royalty payments to mine the iron ore body under lease.

Year Tons Shipped

The impact of Caland operations on the economy is shown in the following tabulations:

1979

Management Decision to Terminate Operations

The following is taken from the Caland Ore "Clippings" of June 28, 1979, it was published over the name of Nat Scott, Manager of Caland Ore Co., to explain the reasons for the decision to shut down the operation:

(Mr. Scott gave his permission to reproduce these words online)

"Although much has been said and written about Caland's forthcoming termination, I am still being asked why we are shutting down. Obviously, the reasons are not clearly understood by everyone and maybe need to be talked about more in order to help people accept and cope with the consequences of the mine closing.

"Although we, like everyone else, are fighting the battle of increasing costs, and that factor because of our deepening pit would eventually and inevitably shut us down. Cost is not the main reason for terminating our operation at this time. Very simply stated, the main reason is that the kind of products we produce are no longer acceptable and cannot compete in the steel-maker's world of today. Furthermore, there is not much we can do in an economic way to better our products.

"Our pellet is the poorest one that Inland uses. Because of the kind of ore we started out with there's not much we can do about that. The pellet breaks down in transit, consumes excessive amounts of coke and limestone, and does not smelt well in the furnace. Consequently, it results in much higher steelmaking costs than do taconite pellets.

"The coarse ore is worse. While its quality is no different than it has been for many years, no one wants it. We were unable to sell 100,000 tons of last year's production. With the exception of one small cargo, we cannot find a buyer for any of this year's production.

"The point I want to drive home again is that our products cannot compete with other readily available ones on the basis of physical and chemical qualities.

"It may be poor consolation to know that other iron ore producers have found themselves in a similar situation and have had to bite the bullet. The great Mesabi range of Minnesota, which produced nothing but natural ores a few decades ago, is now producing high quality pellets almost entirely. Our own Sherwood Mine had to close recently because of unacceptable quality, even though there is a substantial reserve left in the ground.

"In retrospect, we are fortunate that Inland's needs enabled us to extend our pit life from 1976 through 1979. Seeing what has happened to our coarse ore market and what problems we have encountered in the pit, someone might rightfully ask how wise that decision was. In any event, we are fully committed to persevere with our pit operation to the end of this shipping season and to finish up with our pelletizing next year."