Development delayed in the Ring of Fire (Globe and Mail Editorial – November 22, 2013)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

A decision by Cliffs Natural Resources Ltd. to suspend development of its proposed $3.3-billion chromium mine in Northern Ontario sends a worrying signal about the fate of a giant mineral deposit whose economic potential has it being touted as Canada’s next oil sands.

The Ring of Fire region near James Bay is estimated to hold up to $50-billion worth of chromite, nickel, copper and other minerals, but so far only two companies have launched mine projects in the remote area, hundreds of kilometres from the nearest highway. This week, Cleveland-based Cliffs announced it will be suspending work and closing its offices in Thunder Bay and Toronto.

Cliffs says it has spent $500-million since 2010 – including the acquisition of the mineral rights – but has yet to secure road access to the site, complete environmental assessments or see negotiations resolved between the province and First Nations over how the land will be used and how income will be shared. “We’re really at a point where you can take it so far and spend your shareholders’ dollars,” a company spokeswoman told The Globe and Mail.

To the extent Cliffs’ decision has been shaped by slumping commodity prices and the poor viability of the remote site, the suspension may be unavoidable. The worry, however, is that Canada’s notoriously slow process for reviewing natural-resource projects was a factor in the decision.

In 2012, Natural Resources Minister Joe Oliver warned that this country is losing investment to countries like Australia because our approval system is “a patchwork of overlap, duplication and nonsensical complexity,” leading to long delays. Mr. Oliver specifically mentioned that he was worried about the Cliffs project in the Ring of Fire, saying he feared it could be logjammed by a cumbersome process.

Federal and provincial governments have a responsibility to carefully review environmental concerns, and First Nations have a right to negotiate the best possible development deal for their lands. The process must be robust and non-partisan. On review, some proposals will be rejected or modified, and should be. But decisions – pro or con – must be made within a reasonable time frame. The Ring of Fire is in its earliest days, and its fate is far from sealed, but early signs are not encouraging for expeditious development.

For the original version of this article, click here: http://www.theglobeandmail.com/globe-debate/editorials/the-ring-of-fire-and-the-pattern-of-delay/article15551711/#dashboard/follows/

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