Sudbury lands Cliffs smelter – by Lindsay Kelly (Northern Ontario Business – May 9, 2012)

Established in 1980, Northern Ontario Business provides Canadians and international investors with relevant, current and insightful editorial content and business news information about Ontario’s vibrant and resource-rich North.

The suspense is over. Cliffs Natural Resources has announced it will build its $1.85-billion chromite processing facility, which will process chromite ore from its Ring of Fire project, near the town of Capreol, located north of Sudbury.
The smelter, which is expected to produce between 1,250 and 1,750 tonnes of chromite per day, is expected to create 450 jobs during construction, an additional 400 jobs to operate the facility and hundreds more spinoff employment opportunities in Sudbury and across the North.
Situated at the former Moose Mine site, the smelter will process chromite into ferrochrome, a component used in the production of stainless steel. The Ring of Fire, located 500 km north of Thunder Bay, is the only substantial deposit of chromite in North America and is expected to yield 2.3 million tonnes of chromite per year over a 30-year mine life.
Northern Development Minister Rick Bartolucci made the announcement in Sudbury May 9. Calling it an “exciting and historic” announcement for the region, Bartolucci said Cliffs chose Sudbury for its smelter because of the city’s experience in mineral exploration, mineral production and mine financing, along with its skilled workforce, training programs and environmental stewardship.
“Cliffs was very specific when they explained why they chose Capreol after a lengthy and thorough analysis,” Bartolucci said. “Cliffs said this region was selected because it would best support the overall success of the Ring of Fire project; more specifically, we have an existing mining cluster of expertise, experienced workers, the appropriate community support and access to existing power.”
Bartolucci additionally announced the province would invest in a transportation corridor in northwestern Ontario, but failed to put a dollar figure on the province’s commitment.
While Cliffs and the province have an agreement-in-principle, Bartolucci said discussions about a number of issues are ongoing, including whether the company will receive a rebate on power, and whether they will ship some of the chromite out of the country for processing, a move that would require the company to secure a domestic processing exemption from the province.
Parameters of an agreement will only be released once finalized, he said.
In a news release, Bill Boor, Cliffs’ senior vice-president of global ferroalloys, said the announcement marked a major milestone for the project.
“Now, we are able to commit to a project definition, moving us closer to making the chromite project reality,” he said. “By following a very rigorous and disciplined pre-feasibility approach, we are confident that the viability of the project is enhanced, which is critical to creating stable jobs and bringing other social and economic benefits to the region.”
Before the project can move forward, however, Boor emphasized the company must receive provincial and federal environmental assessment approvals, negotiate agreements with affected First Nations, work with the government to address the lack of infrastructure in the Ring of Fire and complete commercial and technical feasibility studies.
Wahnapitae First Nation Chief Myles Tyson said his community is supportive of the project and has been in discussions with Cliffs for more than a year on how the First Nation, located 20 km northeast of the planned chromite processing facility, can benefit from the development.
The company has been very open to talking with the community, but “nothing has been set in stone,” Tyson said. The First Nation is now waiting for Cliffs to begin “a meaningful dialogue” with the community.
“We’ll have to see what comes out of the ongoing discussions, but as long as it’s done in an environmentally sound way, that’s not damaging Mother Earth, we’re all for the development of this project,” Tyson said.
Tyson was especially pleased at the emphasis on consultation with First Nations.
“It’s very encouraging that Rick (Bartolucci) had mentioned the consultation with First Nations,” he said. “It has to happen, and Wahnapitae is open to industry, and let’s sit down and talk about it.”