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Questions are being raised about how much taxpayers are on the hook for as a U.S. mining giant attempts to develop of an ecologically sensitive area in northern Ontario.
The Ontario government announced Wednesday it had reached an initial agreement with Cliffs Natural Resources Inc. to develop a chromite mine at the remote Ring of Fire region.
Cliffs is expected to invest $3.3 billion into building a mine, nearly 500 kilometres northeast of Thunder Bay, a smelter in the Sudbury area and a transportation corridor to move the ore between the two facilities.
Sources tell the Star the Liberal government is negotiating a deal on electricity subsidies in order to keep the smelter in the province. Also on the table is said to be construction of a transportation corridor to move the chromite south. On Thursday, Northern Development Minister Rick Bartolucci refused to talk about any possible subsidy.
“There is an agreement in principle, there is not a deal,” he said. “Once we have a deal in place then we’ll make the parameters of the agreement and the details, public.”
The chromite deposit is estimated to be worth $30 billion. Mining companies have staked 9,000 claims covering 480,000 hectares in the region.
If a final deal is signed, 400 jobs will be created at the mine and another 450 at the smelter plus thousands of indirect spin-off jobs.
The power needs of the $1.8 billion smelter is equivalent to that of a city of 300,000 people, said Ramsey Hart of MiningWatch Canada, a public advocacy group.
The ring is a remote, pristine part of the Hudson Bay Lowlands.
It’s estimated it will cost nearly $600 million to build a north-south transportation corridor cutting across the Fort Albany River area to reach the smelter.
Bartolucci would not say if the government will help pay for roads or bridges.
“Obviously, that too, is subject to discussion at this period in time. We understand that as we move forward it will be a collaborative effort that will be necessary to realize the potential of the Ring,” he said.
MiningWatch is concerned the deal being negotiated is being done behind closed doors with little public input.
For the rest of this article, please go to the Toronto Star website: http://www.thestar.com/business/article/1176547–chromite-mine-may-carry-hidden-costs-critics-charge