Province optimistic development will go ahead – by Laura Stricker (Sudbury Star – June 14, 2013)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

Cliffs Natural Resources’ work in the Ring of Fire may have come to a screeching halt, but the minister of Northern Development and Mines said he’s determined to see the project through.

“I do remain very optimistic about this project,” Michael Gravelle, who’s also the MPP for Thunder Bay, said on the phone. “I think it needs to be understood … that this is a very transformational, large project, in a part of the province that’s never seen development before.

“It’s important that we get this process right. Clearly there are a number of parts that are crucial to this before we can move for ward, and one of them is environmental assessment.”

On Wednesday, Cliffs announced it was temporarily suspending the $3.3-billion project, which includes a smelter in Capreol, until the provincial government takes action on the file. Bill Boor, senior vice-president of global ferroalloys for Cliffs, said Wednesday the company has done as much as it can and now needs to wait for the government to make a move.

“I’m keen to continue to sit down with Cliffs to finalize the arrangements that we’ve been in discussion with the company on,” said Gravelle. “Because of the size of this project … there are going to be challenges along the way, but we are still very confident that the project can move forward.”

Tony Clement, who has federal responsibility for the entire Ring of Fire file, said in a written statement he’s also determined to press on with the development.

“This decision (to suspend) was made by a private company. Our Conservative Government is focused on working with all stakeholders to ensure the potential of the Ring of Fire becomes a reality. We will continue to work with all levels of government, First Nations and other stakeholders to help maximize the economic opportunities for Northern Ontarians.”

Stan Sudol, a mining analyst and Sudbury Star columnist, called Cliffs’ decision disappointing.

“I am disappointed that Cliffs would not be a bit more patient with the new Liberal government. Premier (Kathleen) Wynne has had a tough time dealing with all the toxic files that (former premier Dalton) McGuinty left her, and she only assured the survival of her government earlier this week with the successful passing of the budget bill.”

The perception by many, Sudol said, is Cliffs is attempting to put pressure on the government.

“To many people, the decision to temporarily delay the project does look like pressure tactics — some might even say economic blackmail — by Cliffs, to make the new government agree to all the company’s demands.

“Considering the depressed state of mining sector and low metal prices, the Wynne government can and should take the time to get very familiar with this file and implement policies that are for the benefit of all the people of Ontario, not just the company and its shareholders.”

On Thursday, shares in the company closed at $18.70, up $1.33 from Wednesday’s close to three-year low.

In a release issued shortly after Cliffs made the announcement, Noront Resources Ltd., which also has plans for the Ring of Fire, said it is carrying on as originally planned.


Issues Cliffs Natural Resources is facing, according to mining analyst Stan Sudol:

Type of environmental assessment: Cliffs wants a limited and shorter one, while the First Nations are pushing for one that’s all-encompassing.

The price of power: “If the Ontario government wants the ferrochrome furnace in this province, it must guarantee a subsidized power rate to the company,” he said. When Joseph Carraba, president of Cliffs, came to Sudbury last year, he told reporters the company was pleased with the rate it was promised.

Unresolved surface rights:

KWG Resources Inc. and Cliffs are battling over land rights, Sudol said. KWG staked claim to a transportation corridor made up of land that is much better for construction than the low-lying swamp that makes up a lot of the region. Cliffs wants the land to build their road, while KWG wants it to build a railway.

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