Bill to process minerals in province quashed – by Jonathan Migneault (Sudbury Star – April 12, 2013)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

“There will be an increasing demand for resources in the next few decades,” Sudol said.
With more resource scarcity, Sudol said, other jurisdictions would have to play by Ontario’s
rules if they want access to its ore deposits, and that could include conditions to process
that ore within the province.

The Ontario Liberals and Conservatives voted Thursday to defeat a private member’s bill that would have amended the Mining Act to require any resources mined in Ontario also be processed in the province.

The bill was introduced by NDP MPP Michael Mantha, that party’s Northern Development and Mines critic, and was defeated after second reading by a vote of 70 to 18.

“My bill would have given Ontario’s mining industry a bright future,” Mantha said in a release after his bill’s defeat. “By keeping our resources in the province, there is the potential of job creation in many sectors. We would ensure that the unprecedented wealth of resources in the Ring of Fire is used to create good value added jobs for Ontarians.”

Mantha introduced Bill 43, An Act to amend the Mining Act to require resources to be processed in Ontario, to prevent situations like the closing of the Xstrata copper and zinc metallurgical plants in Timmins three years ago.

The smelter’s closure cost 670 jobs in Timmins. The operations were moved to Noranda, Que., where energy costs are cheaper than in Ontario.

The Mining Act prevents companies that extract resources in Ontario to process them outside of Canada unless they have a special exemption from the government. But Ontario minerals and ore are often refined in Quebec and Manitoba. Mantha hoped his bill would end that practice and create more jobs in the province.

Michael Gravelle, Ontario’s minister of Northern Development and Mines, said Mantha’s bill would have killed more jobs than it would have created. “Putting this legislation into law would quite frankly invite retaliation from other companies and other jurisdictions,” Gravelle told The Sudbury Star before the vote.

Gravelle said the legislation’s protectionist measures would have put Xstrata’s nickel smelting operations in Sudbury at risk. Xstrata employs about 1,200 people in Sudbury for those operations. About 70% of the nickel processed there comes from outside the province, Gravelle said.

“I truly believe that if this legislation was to come into law we would be moving into dangerous ground that could put jobs in peril,” he said.

Progressive Conser vative MPP Norm Miller said the gove r n m e nt should focus on reducing hydro rates to compete with neighbouring provinces instead of enacting protectionist policies “the province cannot afford.”

A report called the Environmental and Economic Consequences of Ontario’s Green Energy Act, published by the Fraser institute on Thursday, April 11, said the Green Energy Act “will soon put the province at or near the top of North American electricity costs.”

The report compared the average electricity rates in 11 North American cities from 2008 to 2012. For large consumers, the average rate in Ottawa was 9.09 cents per kWh. In Montreal the average was 5.05 cents per kWh and in Winnipeg it was 3.55 cents per kWh.

But Gravelle said the Northern Industrial Electricity Rate Program has reduced energy costs by about 25% for operations that qualify.

“Provincial efforts to shield these industries through energy subsidy programs only transfer the costs onto Ontario taxpayers, who are already dealing with skyrocketing residential electricity prices,” said Ross McKitrick, the author of the Fraser Institute report.

David Robinson, director of Laurentian University’s Institute for Northern Ontario Research and Development, said the NDP’s proposed legis-l at i o n could have helped Ontario with the right supporting policies.

Robinson said the potential chromite smelter in Capreol, which would bring around 450 jobs to the community, could lead to an additional 500 jobs if all the ore had to be smelted in Ontario. He said Cliffs plans to export half its ore from the Ring of Fire outside of Canada, which would result in fewer Ontario jobs.

Stan Sudol, a mining analyst and the editor of the Republic of Mining website, said a protectionist refining policy would not necessarily alienate jurisdictions outside Ontario in today’s economic climate.

“There will be an increasing demand for resources in the next few decades,” Sudol said. He said Ontario could leverage its position as a politically stable jurisdiction with multi-generation ore deposits to sell itself to resource-hungry countries like China and India.

With more resource scarcity, Sudol said, other jurisdictions would have to play by Ontario’s rules if they want access to its ore deposits, and that could include conditions to process that ore within the province.

For the original digital version of this article, click here: http://www.thesudburystar.com/2013/04/12/bill-to-process-minerals-in-province-quashed

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