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Ontario creates Ring of Fire Infrastructure Development Corporation

Minister of Northern Development and Mines Michael Gravelle

Minister of Northern Development and Mines Michael Gravelle

Photo by Henry Lazenby

28th August 2014

By: Henry Lazenby

Creamer Media Deputy Editor: North America

  

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TORONTO (miningweekly.com) – The Ontario government on Thursday announced that it had established the Ring of Fire (RoF) Infrastructure Development Corporation, first mooted in November last year.

The provincial government said the not-for-profit corporation’s headquarters would be located in Thunder Bay and its mandate would be to bring First Nations, the public and private sectors together to create partnerships and facilitate investment decisions in strategic transportation infrastructure.

“The development corporation is a vital step towards building the much-needed infrastructure that is critical to realising the full potential of the Ring of Fire. It is a key building block to achieving our mutual goals of unlocking regional economic growth and benefitting from value-added opportunities like mineral processing and job creation,” provincial Minister of Northern Development and Mines Michael Gravelle said.

The corporation established an interim board of four Ontario public servants, who would put the necessary structures in place to allow partners to determine their participation in the corporation. This included working with key partners on all levels to formalise partnerships through the corporation and oversee an economic and technical baseline feasibility report on transportation infrastructure.

The board comprised the infrastructure Ontario transaction structuring risk and commercial projects division executive director Ehrn Cory, Assistant Deputy Minister for Economic, Environment, Justice and Intergovernmental Policy Rob Dowler, Assistant Deputy Minister and chief administrative officer for the Ministry of Transportation Linda McAusland and Assistant Deputy Minister for the Northern Development division of the Ministry of Northern Development and Mines Bill Thornton.

As participation in the corporation evolves, the board would be expanded to include membership from First Nations and industry partners. In its mature state, the corporation would be in a position to advise on crucial infrastructure investment decisions, including how to best use Ontario's $1-billion commitment to RoF infrastructure.

Liberal-led Ontario established the corporation as part of its election campaign promises of
 July 3, which involved establishing a development corporation within 60 days of winning the elections.

OPPORTUNITY OF A LIFETIME

The RoF had been billed as a ‘multigenerational economic opportunity’ for the province, with mineral potential worth $60-billion, which represented one of the largest known deposits in the world.

The remote RoF in the McFaulds Lake area of the James Bay Lowlands – about 540 km north-east of Thunder Bay – has attracted much attention over recent years, with exploration drills turning to look for minerals, including chrome, nickel, copper and platinum-group metals.

It also presents an unprecedented opportunity for job creation with long-term benefits for communities in the North and the entire province.

But the region, where more than 20 companies hold claims, needs infrastructure, most critically transportation infrastructure, to turn it into Canada’s newest mining camp. It is estimated that the region needs about C$2.25-billion in transportation and industrial infrastructure.

It includes the largest deposit of chromite ever discovered in North America, which is a critical ingredient used to create stainless steel.

Ontario said, as part of the Crown’s duty to consult, the province was continuing discussions with the Matawa-member First Nations through a regional framework agreement, inked in March, that would help ensure these First Nation communities actively participated in and benefitted from RoF developments.

ROUTING CONFLICT

Meanwhile, the first movers in the area were embroiled in legal battles hinging on whether to build a rail, or all-weather road corridor, to the RoF.

Junior explorer KWG Resources, through a subsidiary, Canada Chrome Corporation (CCC), controls the key transportation route on land, which it acquired through claim staking in 2009.

KWG has proposed a rail route connecting to the CN transcontinental rail line at the Exton rail siding to transport ore to consumers, which was competing with its US-based joint venture partner Cliffs Natural Resources’ proposed all-weather road south, connecting to the same rail line west of Exton. Cliffs’ plan is to transport chromite concentrate from there by rail to Capreol, in the Sudbury area, where it plans to build a ferrochrome production facility.

However, Cliffs in November announced that it would suspend indefinitely its $3.3-billion Black Thor chromite project, citing the uncertain timeline and risks associated with developing the necessary infrastructure to bring this project on line.

Cliffs had also become embroiled in a legal battle for access to mining claims held by KWG, over which the only viable access route to the chromite deposits could be constructed.

KWG earlier this month explained that CCC would seek permission from the Ontario Court of Appeal to overturn a July 30 ruling of the Divisional Court of the Ontario Superior Court of Justice, that ruled that CCC's consent should be waived in an application for an easement to build a road over its mining claims.

In its decision in the appeal brought by 2274659 Ontario Inc, a subsidiary of Cliffs, the Divisional Court set aside the decision of the Ontario Mining and Lands Commissioner issued on September 10, granting the original application to dispense with CCC’s permission for an easement over its mining claims.

Edited by Tracy Hancock
Creamer Media Contributing Editor

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