Ontario open for mining business – by Jodi Lundmark (tbnewswatch.com – November 21, 2013)

http://www.tbnewswatch.com/

Ontario is still open for business, despite Cliffs Natural Resources indefinitely halting their chromite project in the Ring of Fire.

That’s the message the mining services project manager for Thunder Bay’s Community Economic Development Commission wants to send to potential investors.

“This creates a little bit of uncertainty from the investment standpoint around the globe,” said John Mason of Cliffs’ Wednesday announcement.

“This message went around the globe very quickly last night. It speaks to receptivity for risk capital to Ontario for exploration development and mining.”

Cliffs Natural Resources in a release issued Wednesday night, said it plans to halt development of its Northern Ontario chromite project by year’s end. That includes closing its offices in Thunder Bay and Toronto and the exploration camp in the Ring of Fire.

When he heard the news, Mason said he felt sadness over the deposits that are sitting up north that could be creating economic benefit not just for Thunder Bay and the region, but for the province and Canada.

Mason said all levels of government have to come together to let businesses know there are still mining opportunities in Northern Ontario and not just for chromite, but gold, nickel and other metals.

The development corporation announced by the province last week also has to come together quickly.

The format has worked in other provinces like B.C. and Quebec where private and public parties have come together to move projects like the Ring of Fire forward.

“Risk and reward can be shared,” said Mason. “That has to come to the table.”

Mason estimates Cliffs has spent $540 million on exploration and acquisition in the Ring of Fire, including engineering and design work for their proposed north-to-south all-weather road.

And while he believes the company is committed to the project, Mason said from a business perspective, they haven’t seen a dollar of revenue yet and their infrastructure concerns are legitimate.

“If you can’t get the product out in a remote area, you don’t really have a deposit; you don’t have a project,” he said.

With Cliffs being a major player in the Ring of Fire, the CEDC wants to see them back in action developing the mine.

While Cliffs has stopped their project, they will continue discussions with the provincial government around future infrastructure development in the Ring of Fire, said Pat Persico, director of global communications for the Cleveland-based company.

“Cliffs determined it will no longer allocate additional capital to the chromite project given the uncertainty around the timeline and risks associated with the development of the necessary infrastructure to bring this project online,” Persico told CKPR Radio.

Cliffs had suspended the environmental assessment process in June of this year because of delays with the EA process, land surface rights and negotiations with the province.

Persico said the combination of those factors led to the difficult decision to halt work on the chromite project .

She couldn’t say whether the company would ever restart the project.

“We will continue with the dialogue portion …around the infrastructure situation to try to figure out a solution that benefits the First Nation communities, our project and others that are interested in developing in the mining district there,” she said.

Cliffs has to prioritize its projects and spend capital on items that will bring more value to their shareholders, said Persico, adding without resolution on so many critical issues, it’s a decision they had to make.

She said the core of the issue is infrastructure has to happen in the Ring of Fire and a plan to move forward has to materialize versus discussion.

There are 40 people who have been devoted to the chromite project in Thunder Bay, Toronto and Cleveland plus those working at the exploration camp.

Persico said they are looking at other opportunities for those employees.

 

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