Showdown at the Ring: Which route will win out: north-south or east-west? – by Don Wallace (Thunder Bay Chronicle-Journal – June 11, 2016)

With visions of the steely calm of a dusty Burt Lancaster, there now emerges a tense showdown regarding the future (or lack there of) of the Ring of Fire. On the one side we have Noront’s east-west nickel/copper government-paid-for tote road to CNR Savant Lake. On the other is KWG’s, Chinese-built-and-paid-for north-south chromite rail line to CNR Aroland.

As usual the regulator, from whom the two adversaries seek approval, remains in hiding. Consequently, the public, lacking full details of the proposals, can only make guesses based on the public pronouncements by the two proponents.

Beginning with the timing issue, with the east-west road completed with government funds, Noront could commence operation within two years. Whereas KWG chromite production requires north-south rail, which is to be built and paid for by the very experienced Chinese. Nonetheless the wetland route offers some daunting engineering challenges and could take longer.

As for public benefits (i.e., taxes, royalties, added values and, above all, jobs), the potential worth of KWG’s chromite is far greater than Noront’s nickel and copper.

However, this edge applies only if KWG intends to refine ore and produce stainless steel in Canada. If they intend to simply ship raw chromite ore to China, then the public interest value swings in favour of Noront’s nickel and copper.

Here it should be noted that Noront also has chromite holdings but has deferred action on chromite to concentrate on nickel and copper. However, it appears that Noront seems willing to consider future chromite transport arrangements, but today they just want to get on with mining, not transportation. This appears to be sensible.

There is also the thorny question of KWG’s proposed Chinese government-owned railroad in Ontario replete with Red Army staff et al. Without doubt the area of foreign ownership and the various public benefits (taxes, value added, jobs, etc.) is very complex and a detailed scrutiny of the actual proposals by government is needed to tell the tale.

In this regard, recently the responsible minister stated that the provincial government is expecting a study to be complete “very soon” that will inform his decision about whether Noront or KWG’s proposal goes forward, or maybe both? We shall see.

As for the question of what’s best for the First Nations, both parties have worked hard to put their case to various FN communities. Here it would appear the east-west road, proposed by Noront, would provide more FN community access.

Also Noront, since the early days, has been very positive and active in discussion with First Nations. On the other hand, KWG appears willing to offer equity participation which could be attractive to the FNs. Stay tuned for an exciting climax coming soon . . . maybe.

For the original source of this opinion column, click here: