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Canada's feds help fund Nalcor transmission line to Tata mine in Labrador

Canada's federal government will contribute more than C$6.8 million to help build an electric transmission line to a minerals processing facility in Newfoundland and Labrador to link it with hydroelectric supplies as part of its commitment to reduce reliance on diesel generation in remote areas.

The 27-kilometer line and terminal will connect Nalcor Energy's Menihek hydro station with Tata Steel Minerals Canada's processing facility near the border of Newfoundland and Labrador and Quebec, where the company mines for iron ore. The subsidiary of India-based Tata Steel Ltd. will be able to reduce its diesel consumption at the mine site by as much as 40%, the federal government said in an Aug. 16 statement. Nalcor sells the output of the Menihek plant, in northwestern Labrador, to Hydro-Québec under a power purchase agreement.

"It's great news for Labrador that a new transmission line is being constructed to support the mining industry, offset reliance on diesel, and contribute to a green economy," Newfoundland and Labrador Minister of Natural Resources Siobhan Coady said in the statement. "As a province, we have initiated Mining the Future 2030 — a plan for growth in the Newfoundland and Labrador mining industry and the way forward on mineral development."

Canada's government is working to burnish its environmental credentials as it heads into a federal election in October. Prime Minister Justin Trudeau has vowed to work to replace diesel generation in the nation's remote northern communities to reduce greenhouse gas emissions and bolster local economies, some of which depend on mines.

Newfoundland and Labrador owns Nalcor, which generates electricity on the Churchill River in Labrador and holds the government's stakes in offshore oil developments. It bought the 19-MW Menihek station, which has been operating since 1954, from the Iron Ore Co. of Canada in 2007.