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TORONTO (miningweekly.com) – KWG Resources is looking to the Far East to secure funding for its proposed 340 km rail corridor, which the project developer believes holds the key to unlocking the vast mineral wealth of the James Bay Lowlands of Northern Ontario.
“The reason KWG is looking to China to fund its proposed railway line is to increase the odds of securing an offtake partner, which is the critical prerequisite to making the emerging Ring of Fire (RoF) mining camp economically viable. The Chinese are the ultimate offtaker, since they use most of the steelmaking raw material,” said KWG president and CEO Frank Smeenk in an interview with Mining Weekly Online.
He explained that ferrochrome did not have a terminal market place like precious metals did, but instead relied exclusively on contract trading – the same as with iron-ore and coal.
“To make the deposit economic, it is a prerequisite to have an offtake partner,” Smeenk stated, noting that he was headed to China later this month to continue negotiations with interested offtake partners and to establish terms of reference required for a feasibility study to be undertaken by China Railway First Survey & Design Institute Group (FSDI) on KWG’s proposed rail route.
Smeenk stated that the company was carefully and systematically preparing to have the federal ministers in Ottawa informed of the impending international trade opportunity with China. Canada’s ambassador to China would be one of the first to be notified, as well as the Minister of Trade and the Canadian Prime Minister.
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KWG announced late in December that FSDI had completed an initial analysis of KWG’s existing data and had indicated that the quality and extent of the information was sufficient for FSDI to undertake a feasibility study for a railway line connecting the RoF with global markets.
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