Cliffs chooses Sudbury for $1.8B smelter – by Arron Pickard – (Sudbury Northern Life – May 9, 2012)

This article came from Northern Life, Sudbury’s biweekly newspaper.

All rumours about where Cliffs Natural Resources will build its chromite processing plant have been laid to rest.

Cliffs has made public its intentions to build its $1.8-billion chromite processing facility north of Capreol. The Cleveland, Ohio-based company has selected the former Moose Mountain Mine site, located 21 kilometres north of Capreol, as it moves from a prefeasibility stage to feasibility, which takes the company to a more detailed analysis of the project.

An agreement in principle between the province and Cliffs has been reached, Sudbury MPP Rick Bartolucci, Minister of Northern Development and Mines, said. This agreement sets the framework for the project. A formal agreement is expected to be finalized within months.

The project will employ 450 people during construction, and as many as 450 people when the facility is operational in 2015. Mine and mill development, as well as the construction and operation of transportation infrastructure, could create an additional 750 jobs, plus hundreds of indirect employment opportunities for northern Ontarians and First Nations communities. The smelter would be used to process ore from Cliffs Natural Resources chromite mine located in northern Ontario’s Ring of Fire.

In total, Cliffs is investing $3.3 billion into the development of that mine. The ferrochrome processing plant is included in that pricetag.

Bartolucci called the announcement an “incredible opportunity,” and said a smelter in Capreol will, “without a doubt, (result in) a rebirth of that area. It’s nice to see an area that has so much history being revitalized through something I believe is historic in nature. I believe the Ring of Fire has the potential to create another Sudbury with all of its incredible opportunities attached to it.”

The Ring of Fire is a 100-year opportunity, Bartolucci said.

“There is incredible mineral wealth in that area, and we want to maximize it.”

While there were several municipalities in Ontario vying for the smelter, the real fight, “the dramatic and aggressive battle,” was to ensure Cliffs chose Ontario as the location for its smelter, Bartolucci said. Choosing Capreol was entirely Cliffs’ decision, he said.

“Outside jurisdictions really wanted this smelter, and so we are happy Cliffs decided to locate in Ontario,” he said.

The province and Cliffs are still in discussions to set the parameters around the agreement, but Cliffs felt comfortable as the discussions had progressed, as did the provincial government, that it was able to make the announcement. Discussions will also begin on the proposed development of a new all-season road to run south from the Ring of Fire through northwestern Ontario.

In fact, Bartolucci said there is no question that the framework agreement in place will ensure that First Nations communities have the necessary structures in place to benefit from the project.

“Our First Nations communities have a very diligent attitude toward providing employment opportunities for their members,” he said. “Part of our responsibility with regard to the framework is to ensure that training takes place. We’ve already started that, but more needs to be done. We have to work to ensure First Nations have the tools at their disposal so there will be benefits for all.”

The province will try to bring to the table the federal government, Bartolucci said. Premier Dalton McGuinty has already sent a letter to Prime Minister Stephen Harper to encourage the federal government to be an active participant at the tripartite agreement, and the both the First Nations communities and the province want this to happen, he said.

“We are very optimistic that this is such an important opportunity for all of Canada that our federal government will step up to the plate,” he said.

The federal government would provide resources to achieve the framework agreement with regard to socio-economic issues and health issues, he said. The federal government has a responsibility with the environmental process and it has “a very important role to play” in the project.

Cliffs is currently working on the federal and provincial environmental assessment processes as one of the next steps in the feasibility study, a fact backed by Bartolucci.

“Further approvals at both the provincial and federal levels are still needed in order to this project to move foward,” he added.

Bartolucci said he isn’t able to provide a percentage as to how much processing of the ore will be done in Ontario and how much will be done outside of the province, but that is part of the ongoing discussions with Cliffs.

“I am very pleased Cliffs has chosen to move forward to the feasibility stage in our community,” Mayor Marianne Matichuk said. “We are the ideal location for the ferrochrome production facility and we welcome Cliffs as they work towards their final business decision.”

She said the decision is a clear sign that Greater Sudbury is open for business, and that she looks forward to working alongside Cliffs to assist them with any further requirements to ensure the project can get off the ground in an efficient and timely manner.

Cliffs’ decision solidifies the City of Greater Sudbury’s position as a global mining and mineral processing centre, with a strong and strategic location from a transportation perspective, she added. City staff has worked closely with Cliffs over the last year, and will continue to provide whatever information is required for Cliffs to complete the study.

‘This announcement emphasizes the strong and strategic position of the north as an engine motor for economic growth, which was ultimately the focus for all communities wanting to call their city home to this facility,” Scott Lund, chair of the Greater Sudbury Development Corporation, said. “What’s good for any of our cities is good for the North.”