TORONTO – The finger-pointing has begun as governments and critics look to assign blame over a big mining company’s pullout from the Ring of Fire in northern Ontario, a massive mineral-rich area believed to have the economic potential of Alberta’s oilsands.
Cliffs Natural Resources Inc. is suspending its operations indefinitely, saying it couldn’t keep spending money while the question of whether it would be able to build an all-weather road to the remote site remained in doubt.
It’s a major setback for cash-strapped Ontario, which may not see the economic windfall the governing Liberals had promised anytime soon.
Greg Rickford, the federal Conservatives’ lead minister for the Ring of Fire, said he was surprised with the Cliffs decision, because the company was “very satisfied” with the federal government’s involvement in the project. But in some ways, it wasn’t that surprising, said the minister of state for FedNor, the economic development organization for northern Ontario.
“I think that the announcement Cliffs made reflects uncertainty in a broader business sense,” Rickford said in Timmins, Ont.
“The commodity market hasn’t been that great for them, and in this case, they’re waiting on some things the province ought to have responded to a little bit sooner.”
Ontario’s governing Liberals need to deal with the dispute over access to the site, because big companies looking to develop the massive chromite deposit can’t proceed until they know “what direction they’re going to go.”
“This challenge, I think, sits squarely in the premier’s office,” Rickford said. “The world is watching, this is a legacy resource project and we want to get it right for the multi-generations of northern Ontarians that can benefit from this.”
Ontario seems to understand the challenges that lie ahead and is willing to work more collaboratively, he added.
But the province should have collaborated more with the federal government, First Nations and the companies involved before announcing a development corporation to move the project along.
“We would have appreciated a little bit more collaboration and notice in that since what it considers is fairly large in scope, from what I can gather, although it’s not been shared with me at this point,” he said.
“And I think the First Nations and the private sector companies implicated feel the same way.”
Cliffs wanted to build a road to the site, but junior mining company KWG (TSXV:KWG) had already staked the most viable corridor through very difficult wetland terrain for a potential railroad.
Cliffs suspended its environmental assessment activities in June and asked Ontario’s Mining and Lands Commission for an easement over KWG’s mining claims. The application was dismissed in September. Cliffs has appealed.
But the company isn’t selling its Ring of Fire assets and appears to be biding its time until the provincial government intervenes on the road issue.
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