Stan Sudol is a Toronto-based communications consultant, mining policy analyst and publisher/editor of www.republicofmining.com.
Ontario’s “Ring of Fire” mineral belt, located in the province’s remote James Bay Lowlands, is thought to hold more than $60 billion of geological riches. When the belt was discovered in 2007, it was supposed to usher in a new era of prosperity for Northern Ontario, especially for the impoverished First Nations communities in the region.
Almost a decade later, the ore remains in the ground and doesn’t appear to be coming out anytime soon. Thanks to the Ontario government’s ineptitude, dysfunctional mining policy, lack of promised infrastructure spending and (to a much lesser extent) a broader commodity slump, American miner Cliffs Natural Resources Inc. left the province in frustration in 2013, permanently halting its proposed US$3.3-billion chromite project.
The ultimate indignity for Ontario came last year, when Cliffs sold its US$550-million investment in the Ring of Fire to junior miner Noront Resources Ltd. — the only significant player left in the area — for a bargain-basement price of US$27.5 million.
Many analysts say that Ontario missed an extraordinary opportunity to establish a chromite industry during the commodity boom, and that it will be at least five or more years before any possible development occurs.
While the provincial Liberals shoulder most of the blame for delaying Ontario’s best mineral discovery in over a century, they did have a legitimate complaint: the previous federal government under Stephen Harper was not at the economic table in a meaningful way.
With the election of the Trudeau Liberals, who have a strong mandate to alleviate living standards of Canada’s First Nations communities, hopes for the development of the Ring of Fire and the enormous mineral potential of the entire northwestern region of Ontario have been renewed.
The mining companies in the Ring of Fire need infrastructure, and so do the isolated aboriginal communities. If the Trudeau government worked in conjunction with Ontario and adopted something akin to a “Marshall Plan” — the name of the American initiative to rebuild war-torn Europe after the Second World War — to develop and modernize infrastructure in the isolated northwest, it would kill two birds with one stone.
The standard of living for First Nations communities would dramatically improve, and a new round of mineral exploration and development would take place that would generate billions of dollars in tax revenue to pay back the government’s investment. And then some.
For the rest of this column, click here: http://business.financialpost.com/news/mining/what-ontario-needs-to-unlock-ring-of-fires-mineral-wealth-is-a-marshall-plan