Hot mineral exploration areas like the Ring of Fire in northern Ontario suggest significant construction down the road. But builders looking for more immediate work should focus on sites elsewhere in the province that are closer to actual mine activity, industry reps say.
Located in the James Bay Lowlands, hundreds of miles north of existing transportation and hydroelectric infrastructure, the Ring of Fire has attracted considerable attention in recent years. Mining prospectors and early-stage developers are hoping to tap what’s widely believed to be mammoth deposits of chromium, nickel, copper, platinum and palladium.
True, infrastructure such as an often-discussed $600-million railway line will be needed. However, actual development is years away at best. Although the Ontario government has announced its intention to open the area to growth, local Aboriginal populations are demanding treaty rights and environmental groups are worried new transportation corridors and mines will harm the fragile boreal forest.
“The Ring of Fire is a hot topic,” says Peter McBride, a spokesperson with the Ontario Mining Association. “It’s an area of incredible potential. Mines could be operating there for generations, but we’re not quite there yet. There’s lots more going on before it will come on stream.”
The construction industry should pay attention to mines elsewhere in Ontario that will be coming into production within the next few years, McBride says.
“Right now, in Ontario alone, between new mines and mine expansions, you’re looking at capital expenditures in the range of $8.5 billion. I don’t think any industry is making capital expenditures on new projects that are as big as what mining is making.
These more immediate hot-spots are as close-at-hand as the Sudbury area, where Xstrata has invested close to $1 billion in its Nickel Rim South Mine, a new nickel-copper property. Vale also plans to invest $3.4 billion to upgrade century-old mining operations in the area.
Probably the biggest construction project in the province right now is Detour Gold, northeast of Cochrane. The company is investing more than $1.2 billion to bring a former site back into production by 2013.
“Right now there’s a construction camp there housing 1,000 people,” McBride says. “That’s probably the biggest hotel and food service project in northern Ontario.”
Northgate Minerals is bringing its Young-Davidson gold mine into production in early 2012 to a site west of Kirkland Lake.
“That’s close to a $340 million capital expenditure,” McBride says.
Even southern Ontario has potential for growth. McBride says some salt and gypsum mines are being expanded.
All this development raises the question: What construction services might be needed?
Forget monolithic cookie-cutter projects. McBride says every mine and every mining community is different. In places where a new mine is being built, the shopping list can include anything from roads and buildings to hoisting equipment and headframes.
“Mineral production is heavy industry,” McBride says. Consulting engineering firms are needed to manage procurement and construction, and supply and service providers to understand and serve the mining sector.
McBride says Ontario’s mine supply and service sector is substantial, recording more than $6 billion in annual revenues. Of course, this includes products and is broader in scope than building and construction services.
Dick DeStefano, executive director of the Sudbury Area Mining Supply and Service Association, says needs in and around mining sites include a range of buildings, including homes for workers, office space, and industrial facilities.
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