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Ring of Fire News – February 20, 2014

  • Ontario Chamber of Commerce (OCC):  Ring of Fire is a HUGE opportunity – get stuck in, province and feds!  “The highly touted Ring of Fire mineral belt in Northern Ontario is expected to generate nearly $2 billion in tax revenues and up to 5,500 full-time jobs in the first 10 years of mining activity, says a new report.  The Ontario Chamber of Commerce’s action plan and economic analysis, to be made public in Toronto Thursday, also calls on the federal government to make the Ring of Fire a national priority.  The report says that within the first decade of development, the mineral-rich area will generate up to $9.4 billion in GDP and nearly $6.2 billion for the province’s mining industry.  Hoping to spur activity in the stalled region, the chamber is calling on Ottawa to take a more active role in the financing of the lucrative mining camp, since it stands to be the primary benefactor of tax revenues — and that “should provide a compelling incentive to invest.”  “At a minimum, it should match any provincial investments in the Ring of Fire infrastructure,” says the “Beneath the Surface” report ….”moremore from other news media (Google News) – OCC news releasemore from OCC
  • Reaction to Ontario hiring Deloitte to move the Ring of Fire Development Corporation along (1a)  “…. Federal Minister Greg Rickford states, “Economic Action Plan 2014 reaffirmed our government’s commitment to the new Building Canada Plan.  We look forward to the Government of Ontario identifying its priority infrastructure projects under Building Canada, including those projects related to the Ring of Fire”.  “We also look forward to Ontario providing the Government of Canada with details on the proposed Development Corporation,” adds the Kenora MP and Minister responsible for the Ring of Fire. “Our Government believes that the Ring of Fire is a legacy resource development project with the potential to contribute significantly to the economic future of Northern Ontario” ….”
  • Reaction to Ontario hiring Deloitte to move the Ring of Fire Development Corporation along (1b)  “….  Greg Rickford, the federal minister responsible for the file, says it’s up to Ontario’s provincial government to apply for infrastructure funding under the new Building Canada fund announced last week.  “We have always been clear that the Build Canada fund contemplates these large-scale, economic development-based, responsible resource development projects,” Rickford said in an interview. “That’s what it’s intended to do.”  “But those resources have to align with the priorities of the province — so to the extent that the province says ‘this is our major file, this is where we want considerable resources to go into,’ … then we can do that.”  That could eat up a huge portion of Ontario’s $2.4-billion share of the 10-year federal fund.  “That’s for Queen’s Park to sort out,” said Rickford ….”Building Canada Fund information
  • Reaction to Ontario hiring Deloitte to move the Ring of Fire Development Corporation along  (2)  “…. Opposition politicians were quick to criticize Gravelle’s announcement Friday as lacking in substance. Nipissing Progressive Conservative MPP Vic Fedeli, who just returned from his fourth visit to the Ring of Fire, said virtually no progress has been made on establishing the development corporation three months after it was announced.  He also expressed his support for the rail transportation option proposed by KWG Resources.  New Democrat Northern Development and Mines critic, Algoma-Manitoulin MPP Michael Mantha, said Friday’s announcement by Gravelle was a “stark reminder of the Liberal government’s inability to spur development in the mining sector.  “The Liberal government continues to govern by press release; all talk no action,” said Mantha.  He called the hiring of Deloitte LLP “a plan to make a plan to make a plan. Industry, as we have seen, are packing up and leaving, taking their investment dollars and good jobs elsewhere,” he said.”more from opposition politiciansmore
  • Reaction to Ontario hiring Deloitte to move the Ring of Fire Development Corporation along (3)  “….  Noront Resources vice-president of Aboriginal affairs Glenn Nolan said it’s a good idea to bring the company on board in order to get some clarity and direction in the Ring of Fire.  “We’d like to see the idea move forward, to advance. That’s our only issue,” he said.  As the only company that has a feasibility study done, as well as a submitted Environmental Assessment with a proposed East-West Road from Pickle Lake, they should be considered as the primary option when it comes to infrastructure.  “We’re the only company that actually has anything of substance,” he said ….”
  • Meanwhile, Noront continues to offer itself as the solution  “Sticking to the basics, keep their eye on the ball and concentrate on making contact is the strategy Noront Resources is continuing as it continues to outpace all others in the most touted mining discovery in a generation – the Ring of Fire in Northern Ontario.  CEO and president of Noront Alan Coutts brakes down the complexity of his specific proposal to create a viable mine in one of the remotest parts of the province.  “You don’t need to go for the grand slam homerun right away. You just need to get a base hit,” said Coutts.  After years standing in the on deck circle Noront is preparing to take its best swing for that base hit this year applying for permit approvals for a permanent road to the mine site about 500 km north of Timmins. The road would run east-west from Pickle Lake above Thunder Bay running mostly along a route that serves four First Nations communities via winter road.   With a 282 km route to cover across James Bay Lowlands the company is saying it is the best way to push their proposed Eagle’s Nest deposit from very expensive find to an active mine.  The road is plan A in a draft environmental assessment proposal submitted jointly to the federal and provincial governments this past December with plans to submit a formal proposal early this year so work can start next winter to connect the Ring of Fire by something other than air transport.  While the company has some ideas about how to build the road, paying for it is something that remains up in the air. Noront is prepared to budget an amount of money in the tens of millions of dollars towards it but believes the government should also be at the table. The east-west route could bring direct year-round road access to the First Nations of Webequie, Naskantanga, Nibinamik and Eabamatoong – all currently fly-in communities relying on diesel generation – along with the possibility of hooking into the provincial grid ….”
  • More of the latest from Cliffs  “Though some shareholders of Cliffs Natural Resources have been calling for his replacement, the Sudbury native who put the brakes on what had been expected to be the first operating mine in the Ring of Fire has been given a promotion.  Cleveland-based Cliffs last week elevated Gary Halverson so that he is the company’s CEO as well as president.  Halverson, 55, was hired in November as Cliffs’ president and chief operating officer.  “We are confident that Gary is the right candidate to lead Cliffs, given his proven experience with international and long-term mining operations and understanding of the global commodities industry,” said a Cliffs news release.  A few days after Halverson was hired, Cliffs announced that it was stopping all pre-development work on a proposed ROF chromite mine about 550 kilometres northeast of Thunder Bay ….”
  • Analyst commentary  “Like most relationships, the affair between Cliffs and Canada started off with a long slow flirtation, then got hot and heavy, cooled off, and eventually got downright dysfunctional. On a Valentine’s Day press conference, Cliffs Natural Resources (CLF) told Canada “It’s not you, it’s me.” ….”More Cliffs analysis
  • The latest on another Ring of Fire player  ” Fancamp Exploration Ltd. is the subject of a Mining MarketWatch Journal Review offering insight and opportunity afforded investors. FNC.V is a junior miner with ownership interests in several exceptional advanced-stage flagship properties that it originated and has since vended. FNC.V is positioned for potential extraordinary share price appreciation over the coming months and years as the reality of the large inherent value that the Company possesses is understood by the market and milestones by its partner companies are achieved.  The full Mining Journal review may be found at http://miningmarketwatch.net/fnc.htm online ….”
  • Another possible way, from the In Support of Mining blog  “The Quebec government has stunned the natural resource sector with an announcement that it will trade public funding for a big equity stake in oil and gas development in the Gulf of St. Lawrence.  It’s an interesting move, and Ontario’s provincial leaders should take notice.  In a Thursday announcement, the PQ government said it was striking two separate equity deals with all the companies that hold exploration permits on Anticosti Island, in exchange for funding their drilling programs.  The first of the deals will see Quebec contribute $70 million for a $100-million drilling program undertaken with two Canadian-based juniors, Pétrolia Inc. and Corridor Resources, who will throw in their exploration licences, and the French firm Maurel & Prom, which will invest up to $43 million in the program. The province will hold a 35-per-cent stake, while the others split the rest.  A second deal contemplates a $45-million government investment in a $90-million program undertaken with Quebec-based junior Junex, which will transfer its land rights into the joint venture for a 20 per-cent-stake. Another partner would be brought in to complete the set.  As Junex described it, the two-phase exploration program will be financed by Ressources Quebec and “a third party industry player who remains to be identified and who will be at arm’s length,” in return for an 80-per-cent stake in “a special purpose vehicle created for the project which will control 100 per cent of Junex’s Anticosti Island permits.”  So the move comes with a hefty price tag. But, according to the government, the yet-unproven Anticosti development could represent a $45-billion boon to the province over the next 30 years, in the form of royalties, taxes and return on equity. If the play comes through, it could also help reduce the province’s reliance on foreign oil …. Yes, there is risk associated with the move.  Risk of losing public money. Risk of looking bad.  Risk of provoking backlash from environmental organizations.  Risk of being castigated by ROC commentators for profligate ways and a socialist mindset.  But there is also the promise of significant profit that could benefit the province well into the future.  Are there any lessons here for those who would develop Ontario’s far northern Ring of Fire mineral zone? …”
  • More analyst commentary  “…. Without a doubt, the value of the Ring of Fire’s current and future potential mineral discoveries are in the hundreds of billions of dollars and these multi-generational mines will provide enormous wealth and employment opportunities for the surrounding First Nations communities. This is an economically and socially transformative project that will positively impact not only Ontario’s northwestern frontier but the entire country as well.  But current provincial indecision over what type of transportation – rail or road – that would best spur economic development of the mining camp, various legal challenges between Cliffs and KWG over access to a coveted north-south route, First Nations negotiations about resources revenue sharing, and provincial/federal conflicts over how to pay for transportation and power infrastructure are all stalling the massive chromite projects as well as further exploration efforts.  With a possible provincial election on the horizon, the lack of progress in the Ring of Fire may affect the outcome of many northern ridings. Considering that current polling indicates no party with a commanding lead, these northern ridings may ultimately impact on who becomes the next Premier of Ontario.”

All information shared here in accordance with the Fair Dealing provisions (§29) of the Copyright Act. The blog is not responsible for the accuracy of the source material, and inclusion of material doesn’t mean endorsement.

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