Ontario urged to smarten up to save Ring of Fire development

The mineral-rich area of northern Ontario has been compared to the oil sands in terms of its economic and development potential.

November 24, 2013   by The Canadian Press

TORONTO – The finger-pointing has begun as governments and critics look to assign blame over a big mining company’s pullout from the Ring of Fire in northern Ontario, a massive mineral-rich area believed to have the economic potential of Alberta’s oilsands.

The Ring of Fire is believed to contain the largest deposit of chromite – a key ingredient in the making of stainless steel – to be discovered in North America.

Cliffs Natural Resources Inc. is suspending its operations indefinitely, saying it couldn’t keep spending money while the question of whether it would be able to build an all-weather road to the remote site remained in doubt.

It’s a major setback for cash-strapped Ontario, which may not see the economic windfall the governing Liberals had promised anytime soon.

Greg Rickford, the federal Conservatives’ lead minister for the Ring of Fire, said he was surprised with the Cliffs decision, because the company was “very satisfied” with the federal government’s involvement in the project.

But in some ways, it wasn’t that surprising, said the minister of state for FedNor, the economic development organization for northern Ontario.

“I think that the announcement Cliffs made reflects uncertainty in a broader business sense,” Rickford said in Timmins, Ont.

The Liberals have been touting the Ring of Fire for years as a major mining project that will help boost the struggling province’s economic fortunes, create jobs and bring in revenue to struggling First Nations. The Liberals called on the federal government to “come to the table with matching funds for infrastructure development in the Ring of Fire, the same way they have funded similar projects across Canada.”

Total capital investment for industrial infrastructure could cost up to $1 billion and connecting local communities to all-season access roads could be $1.25 billion, they said.

“This challenge, I think, sits squarely in the premier’s office,” Rickford said.

Ontario seems to understand the challenges that lie ahead and is willing to work more collaboratively, he added.

Cliffs wanted to build a road to the site, but junior mining company KWG had already staked the most viable corridor through very difficult wetland terrain for a potential railroad. It suspended its environmental assessment activities in June and asked Ontario’s Mining and Lands Commission for an easement over KWG’s mining claims. The application was dismissed in September. Cliffs has appealed.

But the company isn’t selling its Ring of Fire assets and appears to be biding its time until the provincial government intervenes on the road issue.

The Liberals are also taking hits from the opposition parties, who say the government needs to get its act together soon if they want to save the project. Those tens of thousands of jobs the Liberals bragged about may never materialize if Cliffs doesn’t come back, the Progressive Conservatives warned.

Cliffs – which was going to pour $3 billion into the Ring of Fire – warned for months that it might pull out over the road dispute, said the NDP. Hundreds of millions of investment dollars has been put aside – and won’t come back for a long time – because the Liberals failed to act, said New Democrat Gilles Bisson, who represents Timmins-James Bay.

It’s a loss for the entire province, he said.

“This is not about a mining job in the Ring of Fire,” Bisson said. “This is about a production job in Hamilton, this is about a service job in Windsor, this is about a job in the finance district of downtown Toronto.”

©The Canadian Press

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