U.S. miner suspends environmental assessment work in Ring of Fire — for now – by John Spears (Toronto Star – June 13, 2013)

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The giant Ring of Fire chromite mining venture in northwestern Ontario has bogged down, with one of the mine developers calling a halt to its environmental assessment.

Cliffs Natural Resources gave a laundry list of unresolved issues with both provincial and federal governments as the reason for suspending the work on the $3.3 billion project.

One mining industry insider said failure to nail down a long-term electricity price is one of the big stumbling blocks.
A smelter for the mine would be among the biggest users of electricity in the province. Cliffs has been planning a $1.85 billion processing facility in Capreol, near Sudbury.

Quebec and Manitoba, with abundant hydro-electric power, can both offer lower rates that Ontario for the smelter.
Another sticking point may be negotiating royalty payments to the province. Chromite is the ore used to produce chromium, a component used in stainless steel, and for plating items such as auto parts and appliances.

Bill Boor, senior vice president of Cliffs, said in an interview that project “is still a very important part of Cliffs’ strategy; that hasn’t changed.”

But he said the company’s original goal of opening the mine by the end of 2016 is now in jeopardy.

Michael Gravelle, Ontario’s minister of northern development and mines said the government “remains fully committed to seeing sound, strategic development move forward in the Ring of Fire.”

Huge deposits of chromite have been found in northwestern Ontario, 500 kilometres northeast of Thunder Bay.

A release from Cliffs didn’t mention either power prices or royalties, but says there are “unfinished agreements with the government of Ontario that are critical to the project’s economic viability.”

The release also mentions delays in approving terms of reference for the provincial environmental assessment, and uncertainty in a federal environmental assessment due to challenges by First Nations.

Environmental and aboriginal groups are worried about the prospect of cutting a 350-kilometre road into the area, which is now untouched wilderness.

There’s still no deal in place to pay for the road. “We’ve taken the environmental assessment and other project work as far as possible without resolution of these issues,” said Bill Boor, senior vice president Cliffs.

“This is a lot less about a decision Cliffs has made today, and more an acknowledgement of where we are,” Boor said. “We’ve run out of productive activity we can do on an environmental process that’s being held up.”

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