Ontario to create Ring of Fire development corporation – by Marilyn Scales (Canadian Mining Journal – November 11, 2013)

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Last Friday in Thunder Bay, Ontario’s Northern Development and Mines Minister Michael Gravelle announced that the province will establish a development corporation to move mining projects forward in the Ring of Fire. The province promises to end the disputes about transportation, provide infrastructure, and ensure that the benefits of development are shared with First Nations.

So far so good. But the idea is drawing criticism from opposition political parties. The government of Premier Kathleen Wynn has been creating dozens of consultation and advisory panels with little to show for them. Missing so far are guidelines about how aboriginal communities will share the revenues.

A thought about this last point: It almost sounds as if the government is supposed to choose a percentage of profits that will go to local communities. If you are an industry insider, it’s chilling to imagine a “First Nations tax” where 10%, or 30% or half of the revenue generated by mining goes to local communities. Anyone who thinks that throwing money at local communities will solve their problems hasn’t been listening for the last 75 years.

The mining industry knows that participation by First Nations is much more beneficial – both socially and monetarily – if nearby residents are given a say in how the land is used, educational opportunities, and the tools with which to establish businesses. Individuals then have skills they can take with them wherever the go.

But I digress …

The Ontario government also asked last week that the federal government share the development costs in the Ring of Fire. Wynne has already written to Prime Minister Stephen Harper saying, “We expect your government to come to the table with matching funds.” There are precedents such as $508 million in direct spending for fossil fuels, $130 million for the Northwest Transmission Line, and $6.4 billion in federal loan guarantees for the Lower Churchill hydroelectric project.

Given the immense cost of developing a region as remote as the Ring of Fire, participation by the federal government is not only reasonable, but necessary.

Friday’s announcements have been welcomed by both KWG Resources, Noront Resources and Cliffs Natural Resources, the three companies with the most advanced projects in the Ring of Fire. When all concerned parties sit at the same table and truly discuss and issue, we know the results can be positive.

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