Nickel Dollars

When the Canadian government two weeks ago switched from silver coins to nickel to benefit one of Canada's biggest basic industries, the nation's seven nickel companies were flustered as well as flattered. Free-world consumption of nickel--825 million pounds last year--is approaching its highest point in history and straining the industry's capacity to supply. The demand is so strong that nickel producers are rushing to develop new sources from the chilly plains of Canada to subtropic mountains in New Caledonia.

Heading the rush is the company that for 65 years has led the industry, International Nickel Co. of Canada Ltd. Inco produces 65% of the free world's nickel, gets two-thirds of its output from Canadian mines, principally, up to now, in the Sudburydistrict of Ontario. To supplement that, the company has been busily prospecting for nickel all around the world. It recently signed a partnership agreement with the French government to mine in New Caledonia, has been carrying on protracted negotiations for other finds in Guatemala, and is beating the brush for nickel in Africa, Australia and Indonesia.

With all that, Inco is carrying out its biggest expansion at home. Of the $1 billion alloted for new development over the next five years, $230 million has been earmarked for mines, refineries and smelters around the town of Thompson in northern Manitoba. The expense is worth it. When in full swing, Inco will be producing no less than 25% of the free world's nickel which will be drawn from three Thompson mines named Pipe, Birchtree and Soab. Interestingly, the Soab lode rests partly under a lake with the same name. Two geologists, sent out after World War II by the Canadian government to map and name western lakes, had trouble getting their seaplane airborne from that one. In angry retaliation they called the offending body of water Soab for son-of-a-bitch.

For the force of 2,900 miners, which will grow to 4,500, life around Thompson is rugged. The thermometer in midwinter hovers around--50DEGF., reaches zero only in late March. Housing is critically short and expensive, schools operate on split shifts because of the growing student population, food has to be shipped in from Winnipeg 400 air miles away. Contact with the outside world is through old shows on cable TV, three-day-old newspapers, or an unreliable air service that does the best it can with aging DC-3s and DC-4s. Not surprisingly, in spite of weekly wages that start at $160--and some of the best fishing in Canada--the turnover rate is a high 85%. "If we could get it down to 20%," says John McCreedy, a onetime professional hockey player with the Toronto Maple Leafs who is Inco's regional manager, "we would be deliriously happy."

Setting Records. Though Inco is giving Thompson highest priority, it is also expanding in Ontario, where five new mines are being opened. "In Canada, alone," says Inco President Albert Gagnebin, "there are programs to produce 100 to 150 million more pounds of nickel per year by 1970." To finance all this expansion, a company that has been financially conservative ever since it was organized in 1902 may have to go into debt for the first time. Inco is not worried at the prospect. Rising demand and higher nickel prices produced a profit of $118 million last year on sales of $694,100,000, and Inco's stock and dividend payouts are setting new records, just like the shiny and coveted metal that is responsible for it all.

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