Cape Breton Development Corporation
The Cape Breton Development Corporation,
or DEVCO, is a Canadian federal government Crown corporation.
DEVCO was organized primarily into two
divisions: a community economic development organization, and the coal
division.
From March 30, 1968 until November 23,
2001, DEVCO's coal division operated Canada's largest underground coal
mines, located in eastern Cape Breton County, Nova Scotia. Following
decommissioning of its mines, DEVCO sold all non-mining surface assets to
the private sector on December 18, 2001, including the Devco Railway and
is presently remediating its mine sites.
Creation of
DEVCO
In 1965, the Dominion Steel and Coal
Corporation, or DOSCO (then a subsidiary of the Hawker-Siddley
Group) announced that its mines had only 15 years of production left
and concluded that the expense of opening new underground mines in the
Sydney Coal Field would be too expensive. The company made its intentions
clear that it would be exiting the coal mining business within months.
In response to a vast public outcry in
industrial Cape Breton County, the Minority government of Prime Minister
Lester Pearson announced J.R. Donald would head a Royal Commission of
Inquiry into the Cape Breton coal industry, with hearings held in 1965 and
1966. The Donald Commission recommended that a federal Crown corporation
be established to acquire and manage DOSCO's coal operations, with the aim
being to slowly wean the Sydney area economy off the coal industry.
-
- "Future planning should be based
on the assumption that the Sydney mines will not operate beyond 1981."
On July 7, 1967 the Cape Breton
Development Corporation, or DEVCO, was established to operate the mines in
the interim, while phasing them out throughout the 1970s and, at the same
time, develop new economic opportunities for the surrounding communities.
On March 30, 1968 DEVCO expropriated DOSCO's coal mines and the Sydney and
Louisburg Railway, settling for a payment of $12 million. At the same
time, the Government of Nova Scotia took over the operation of DOSCO's
integrated steel mill in Sydney, renaming the operation Sydney Steel
Corporation, or SYSCO.
Early operation,
planning for retraction
DEVCO had several operating divisions,
including its Coal Division, as well as economic development divisions,
intended to help the Industrial Cape Breton area diversify its economy
from an over-reliance on the coal and steel industries.
Initially, DEVCO focused on operating
the coal mines throughout the Sydney Coal Field that it had inherited from
DOSCO, while attempting to invest in other initiatives such as
establishing a post-secondary education institution in the area (what
would become the University College of Cape Breton, now Cape Breton
University), tourism developments, industrial parks for non-coal/steel
related manufacturing industries, and investing in small area businesses
and community infrastructure projects to help unemployed coal miners and
steel workers who had been laid off during the 1960s drawdown in
production.
One of DEVCO's first tourism-related
developments in the early 1970s was the Cape Breton Steam Railway, a joint
project with the Sydney and Louisburg Railway Historical Society, which
saw unused Devco Railway tracks between Glace Bay and Louisbourg used for
operating a tourist railway, with coal-powered steam locomotives. The
project ran until it proved to be uneconomic to operate by the late 1970s.
Overall, until 1973, DEVCO was
more-or-less focused on continuing the operation of its former-DOSCO mines
and railway, while providing new economic growth for the region.
Expansion, not
retraction
The October 1973 Yom Kippur War and the
ensuing 1973 oil crisis led the federal government of Prime Minister
Pierre Trudeau to re-examine all Canadian energy production, including the
nationalization of Alberta oil, as well as an expansion of DEVCO coal
production, reversing the recommendation of the 1966 Donald Commission to
phase out production and diversify the Sydney area economy. The Trudeau
government sought to use its ownership of DEVCO to reverse Nova Scotia's
reliance on the importation of foreign oil for generating electricity;
approximately 70% of the province's electricity was generated by foreign
oil by the late 1970s.
New mines were built and opened near New
Waterford (Phalen and Lingan collieries) and on Boularderie Island (Prince
colliery) starting in around 1972-1975. Devco Railway built a spur to
serve the adjacent Phalen and Lingan mines, extending the line to serve
Nova Scotia Power Incorporated's Lingan Generating Station which opened
November 1, 1979.
During the early 1980s, the Devco
Railway retired its diesels locomotives inherited from the Sydney and
Louisburg Railway, which had purchased them second-hand during the early
1960s, and purchased a fleet of new diesel locomotives and coal hoppers,
as well as building new locomotive shops at Victoria Junction, between
Sydney and Glace Bay, and shut down the Glace Bay roundhouse and shops.
DEVCO also shut down a coal wash plant
at Sydney Mines and built a large coal preparation and wash plant at
Victoria Junction in its place, as well as new international shipping
piers on Sydney Harbour, replacing the antiquated export piers inherited
from DOSCO. With federal government financing, DEVCO was in expansion mode
and with the high international prices for coal, sought to produce more
Cape Breton coal for export than ever before.
Production
problems and mine closures
By the late 1980s, production problems
at DEVCO saw the last of the older mines inherited from DOSCO shut down,
with production concentrated at Lingan, Phalen and Prince; the latter not
receiving any rail service. The Point Aconi Generating Station was built
by Nova Scotia Power Incorporated to receive coal from the Prince colliery
directly by conveyor belt, however the Lingan and Phalen mines still
hauled coal to the Victoria Junction preparation plant and then to the
Lingan Generating Station.
The SYSCO steel mill stopped using DEVCO
coal to produce coke as a fuel for its blast furnaces in the mid-1980s. By
the late 1980s, SYSCO had modernized by changing to an electric-arc
process, smelting recycled metal.
Problems with flooding and roof-falls at
the Lingan mine saw production cease in 1992, just months short of the
colliery's 20-year design limit. The Phalen mine continued to be the only
source of online traffic for the Devco Railway, however subsequent
flooding and roof-falls at Phalen caused ever increasing production costs
at a time of fiscal restraint by the federal government.
Layoffs and
selling of assets
Faced with rising subsidies for DEVCO,
the federal government announced it was getting out of the coal industry
in January 1999 by mining out the rest of Phalen by the end of the year
and attempting to sell the Prince colliery.
In September 1999, Phalen colliery
closed for good, with 400 employees laid off and the only on-line traffic
source for the Devco Railway severed. The Prince colliery continued with
production, however coal was trucked from the mine to the Victoria
Junction preparation plant, from which it was then taken by rail to the
Lingan Generating Station. Devco Railway also began to be used for
importing some coal from locations in the United States and South America,
with the international shipping piers beginning to be used in the reverse
of their intended design.
On November 23, 2001, Prince colliery
closed for good, after the federal government failed to entice any private
sector investors to purchase the mine. DEVCO was out of the coal mining
business, however for a period of approximately 1 month, it was in the
coal importation business. The federal government moved swiftly to sell
off assets, transferring the mine properties and mineral rights back to
the provincial Department of Natural Resources. DEVCO subsequently
decommissioned the Victoria Junction coal wash plant and began to
immediately prepare remediation of the mine sites.
On December 18, 2001 DEVCO sold all
surface assets, including the international shipping piers, railway track,
railway rights-of-way, locomotives and rolling stock, and a coal storage
facility and locomotive shops at Victoria Junction to 510845 New Brunswick
Incorporated, a wholly-owned subsidiary of Emera Inc., the holding company
which owns Nova Scotia Power Incorporated (Nova Scotia Power Corporation
having been privatized in 1992).
Emera subsequently contracted the
operation of its newly-acquired DEVCO surface assets to Logistec
Corporation. Logistec sub-contracted operation of the railway to the
Société des chemins de fer du Québec, a Quebec-based railway holding
company and short-line operating company. The new railway was called
Sydney Coal Railway, although ownership of the track and other assets
remains with Emera's subsidiary, 510845 New Brunswick Inc. Logistec
operates the international piers, which handles coal imports from the
United States and South America, while Sydney Coal Railway hauls the coal
to the storage facility at Victoria Junction before transporting it to
NSP's Lingan Generating Station.
FROM WIKIPEDIA