Sydney Steel Corporation Business Plan 2003-04 (continued)

Key Tenants - In December 2001 the corporation signed a lease with Provincial Energy Ventures for the wharf and back-up lands. This portion of the Sysco site will principally be used to blend and transport coal. Provincial Energy Ventures has pledged to spend over $10 million in upgrading this facility over the next 10 years. The terms of the lease require Provincial Energy Ventures to make the wharf and associated services available at market rates.

Although the Sysco property is not being marketed as of yet in any formal way, other companies have also expressed interest in locating on site. These include local environmental businesses and water treatment operation.

Sydney Ports Access Road - Construction is nearing completion on the Sydney Ports Access Road, connecting Highway 125 to the Sysco and Nova Scotia Power piers. The road opened to truck traffic in late 2002 and is expected to be fully open in the Spring of 2003. Sysco is working with partners like Nova Scotia Power and the municipality to build the road quickly, safely and efficiently -- in a way that works for local businesses, residents and taxpayers. More information is found on the SPAR page.

Sale of Assets - In June 2001, Sysco hired a consortium of companies to sell off the assets of Sydney Steel Corporation. The consortium included Henry Butcher International, Michael Fox International and Trans-Canada Liquidations. In August 2001, a two-day auction was held where many of the assets of the plant were sold -- surpassing expectations by raising just over $1 million. The larger steel-making assets of the plant were marketed separately and directly to potential buyers around the world through a private treaty sale.

Sysco has reached an agreement with Maxsteel Ltd. of the UK for the purchase and removal of the plant's larger steelmaking assets. Maxsteel is offering $4.56 million Cdn for the purchase of the assets. At this point, Maxsteel has not decided on the location for the assets, but they will be exported out of North America. Selling the assets now will save approximately $1 million in incremental demolition costs. The Maxsteel offer was brought forward to Sysco by Henry Butcher International, the company hired to market and sell the larger assets of the plant.