Ring of Fire development a political winner, but not quite so for mining companies – by Barrie McKenna (Globe and Mail – April 25, 2016)

http://www.theglobeandmail.com/

OTTAWA — Good lobbyists know that advancing an agenda works best when the stars align. That’s the moment when what you want is in sync with what the government wants. Take the Ring of Fire – a mineral-rich, but untapped swath of northwestern Ontario.

The problem (beyond the immediate inconvenience of depressed commodities prices) is that the area is essentially cut off from the world. There are no roads, rail links or power supply to get at the vast deposits of nickel, chromite, copper and platinum buried in the belt, located 500 kilometres north of Thunder Bay.

Enter Prime Minister Justin Trudeau. He’s committed to spending billions of dollars on infrastructure. He also wants to forge a new relationship with indigenous Canadians, involve them in resource development and create economic opportunities for troubled northern communities, such as Attawapiskat.

Then, consider that Mr. Trudeau’s Liberal government came to power intent on forging closer economic ties with China, possibly through free trade and expanded investment.

And so along comes a subsidiary of state-owned behemoth China Railway Construction Corp., which wants to build a $2-billion, 340-kilometre rail line into the heart of the Ring of Fire. Chinese engineers are working on the proposal with KWG Resources Inc., a Toronto-based junior mining company that has hundreds of mining claims in the area and has plans to develop a chromite mine.

A series of common interests may be lining up. Pushing development of the Ring of Fire checks off a number of important boxes for Mr. Trudeau – trade, infrastructure, indigenous policy, the economy and perhaps even climate change.

Mining development would require putting the area on the power grid, allowing remote First Nations communities to stop using dirty gas-fired power plants.

For the rest of this article, click here: http://www.theglobeandmail.com/report-on-business/rob-commentary/executive-insight/ring-of-fire-spending-a-political-win-but-not-quite-so-for-mining-companies/article29745773/

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