Tacora, still in creditor protection, hints new lease on life will be announced soon

With Tacora Resources in creditor protection and the clock counting down on its stay of proceedings, companies are lining up to ensure they get paid at the same time a company spokesperson hints they're not out yet.

Tacora, which owns the Scully Mine in Wabush in western Labrador, obtained creditor protection from Ontario's Superior Court in October. In documents, it cited a volatile market, raging forest fires and unexpected maintenance at the mine as contributing factors that led to the situation.

Tacora spokesperson Graham Letto told CBC News over email that an update on the company's status is due soon, hinting at good news.

"There will be news coming in the next couple of days who the successful bidder is following the closing of bids on January 19.That will be posted on the TacoraCCAAwebsite," he wrote.Letto added that could mean a new owner or new investor.

"CCAA" refers to the Companies' Creditors Arrangement Act.As part of the creditor protection process, the court appointedFTI Consulting Canadaas Tacora's monitor, which provides an online creditor portal for case updates and court-filed documents for insolvency cases.

Ticking clock

The Minnesota-based Tacora has operated the iron ore mine since 2019.

Previous owner Cliff Natural Resources closed the mine in 2014,which saw the loss of hundreds of jobs along with lost benefits for workers, before Tacora took over operations.

Around the same time Tacora entered creditor protection, it secured a $75-million agreement to keep the mine operating for the next 20 weeks, or until the end of February.

On Jan. 25, according to FTI Consulting's Tacora CCAA website,Tacora obtained an order extending its credit protection period until March 18, giving it more time to restructure its finances.

Meanwhile, a number of companies have filed mechanic's liens claims made against a property to ensure payment over work they claim Tacora did not pay them for.

Nova Scotia-based MacGregor's Custom Machiningclaims it is owed approximately $2.6 million. President and CEO Andy MacGregor declined to comment, citing the short notice.

According to documents filed at the Supreme Court of Newfoundland and Labrador, Crane Supply, a division of 13859380 Canada Inc., claimed it had an agreement with Tacora to provide materials, including pipes, valves and fittings. It's looking for $31,579.92 as well as interest at 24 per cent per annum.

JSM Electrical also claims it provided materials, labour and services, such as installation, construction, maintenance and other services at Tacora's Wabush property, and is looking to recoup $1.3 million, along with interest.

Newfound Roofing also filed for$160,020 related tomaterials and work it alleges was done on "emergency roof repairs"on Oct. 11.

No one from Crane Supply, Newfound Roofing andJSM Electrical replied to requests for commentby publication time.

Letto wrote that mechanic's liens are a "normal part of the CCAA procedure" and the company is not in a position to comment on anything filed on the Tacora CCAA website.

ACOA watching

In June, Tacora received $1.25 million in federal funding from the Atlantic Canada Opportunities Agencyto help it process manganese.

Spokesperson Paul McGrath told CBC News that officials are monitoring the situation closely, adding that ACOAmust respect the legal process of the court order.

"Specific information related to the terms and conditions of a contribution agreement, including the status of repayments, is subject to client confidentiality and cannot be disclosed,"McGrathsaid in a statement.

He also declined to say if Tacora was still in good standing with ACOA.

"We are unable to comment further as this is still before the courts."

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