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Stan Sudol Columns/Media References and Appearances

Ring of Fire: Strategic Chromite and the Commodity Super-Cycle [Part One of Two] – by Stan Sudol (Sudbury Star – August 30, 2013)

Kemi Chromite Mine in northern Finland (Photo Outokumpu Group)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

The recent announcement by American-based Cliffs Natural Resources to temporarily halt its chromite mining project in Ontario’s Ring of Fire camp was met with flying accusations of fault by many politicians affected stakeholders, environmental NGOs and First Nations communities.

There certainly is plenty of blame to go around including the company itself – stubborn opposition to a more thorough environmental assessment demanded by First Nations – Cliffs’ inability to finance the project at the present time and most importantly a currently depressed metals market.

However, this might be a great opportunity to scrutinize the entire development and decide if Ontario has leveraged as many economic and value-added benefits as possible during the current commodity super-cycle and why a tiny country like Finland has been able to do much more with a significantly smaller and lower quality chromite deposit of its own.

But first some project background and geo-political analysis on the current state of global mining would be very helpful for Toronto-centric Premier Wynne and her largely southern Ontario cabinet.

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He has one tough city to sell [Sudbury image] – by Stan Sudol (Globe and Mail – July 15, 1998)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Paul Brokenshire’s message to visitors: look beyond the image

Poor old Sudbury. Nowhere else in the country has been as much maligned. Polluting smokestacks, acid rain, nickel mines, labour unrest and a scarred landscape resembling the backside of the moon, are all indelible images branded into the Canadian psyche, whenever anyone mentions Sudbury. A public relations nightmare.

And yet the city with the bad rep has a convention and visitor’s department, whose mandate is to attract conventions sporting events, trade shows and special events.

According to Paul Brokenshire, its manager: “Absolutely, one of my major hurdles is overcoming the negative views that the national media routinely portray about Sudbury. My job has always been an uphill battle with this city’s negative image.”

He concludes that over the past 20 years, he has heard all the jokes and putdowns; but he soldiers on, while he and the city politicians politely laugh all the way to the bank. The convention and sporting events industry brought in about $38-million for the local community in 1996.

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Sudbury Dumped on the Slag Heap of History – Stan Sudol (Originally Published in the Sudbury Star – February 6 , 2004)

Nickel Tailings #34, Sudbury, Ontario – by Edward Burtynsky

Stan Sudol – “Sudbury Dumped on the Slag Heap of History” was an article I wrote back in February 6, 2004 about Sudbury’s failure at promoting this community in the critically important Toronto media market. It was recently sent out by Dick DeStefano, Director of the Sudbury Area Mining Supply and Service Association, to his extensive email list with a telling question as to whether much has changed on this issue over the past decade.

I have known Dick for many years and have considered him a great friend ever since his tremendous help with a policy document I wrote – Claiming Our Stake! Building a Sustainable Community – for the former Sudbury Mayor David Courtemanche in 2006, which outlined the community’s concerns about the impending loss of Sudbury’s two iconic Canadian miners to foreign ownership.

We have often discussed Sudbury’s negative image in the national media and how is affects the investment decisions of major corporations as well as the perceptions of provincial and federal politicians. Unfortunately,  the article is still very relevant today and most local politicians still fail to grasp the importance of promoting its many unique strengths and mining intelligence – as repeatedly highlighted by DeStefano – in a very competitive Canadian and international market for capital and investment.

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Peat Fuel for Ring of Fire and Aboriginal Communities: Economic and Environmental Benefits – by Stan Sudol (June 27, 2013)

One of the biggest issues with the Ring of Fire development and the surrounding Aboriginal communities is the lack of competitively priced electricity and the enormously high cost – about one billion dollars – of connecting the region to Ontario’s power grid.

Currently, isolated First Nations depend on very expensive diesel fuel that must be supplied by trucks on winter roads or flown in. The proposed mining operations are projected to need about 30 megawatts (MW) of power.

Amazingly, most of the swampy lowlands and many parts of the Canadian Shield throughout northern Ontario contain a source of energy that has been used for centuries in Europe – peat fuel.

This slowly renewing bio-mass energy source – distinct from fossil fuel – is formed from the partial decomposition of plants under very wet and acidic conditions. It is usually made up of two separate layers, the top being lighter in colour, less decomposed and used primarily for horticultural applications while the dark dense lower layers are excellent for fuel. Peatlands can be described as a wet spongy “floating carpet” of land and are often known as bogs, fens, mires, moors, or in Canada, muskeg.

Peat can be processed into fuel-grade material with energy values equivalent to coal but with only ten per cent of the black rock’s sulphur content, virtually no mercury and produces less ash waste and dust emissions. Canada has the world’s largest area of peat lands, estimated to be 41 per cent of the world’s total, half of which is located in northern Ontario.

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CBC Thunder Bay’s Lisa Laco interviews Republic Of Mining’s Stan Sudol about Ring of Fire (CBC News – June 17, 2013)

                              Is it the boom-bust cycle of mining, or is Cliffs Natural Resources playing political poker? Up next, a mining analyst Stan Sudol makes sense of the latest Ring of Fire developments. Click here: http://www.cbc.ca/superiormorning/episodes/2013/06/17/republic-of-mining/

Province optimistic development will go ahead – by Laura Stricker (Sudbury Star – June 14, 2013)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

Cliffs Natural Resources’ work in the Ring of Fire may have come to a screeching halt, but the minister of Northern Development and Mines said he’s determined to see the project through.

“I do remain very optimistic about this project,” Michael Gravelle, who’s also the MPP for Thunder Bay, said on the phone. “I think it needs to be understood … that this is a very transformational, large project, in a part of the province that’s never seen development before.

“It’s important that we get this process right. Clearly there are a number of parts that are crucial to this before we can move for ward, and one of them is environmental assessment.”

On Wednesday, Cliffs announced it was temporarily suspending the $3.3-billion project, which includes a smelter in Capreol, until the provincial government takes action on the file. Bill Boor, senior vice-president of global ferroalloys for Cliffs, said Wednesday the company has done as much as it can and now needs to wait for the government to make a move.

“I’m keen to continue to sit down with Cliffs to finalize the arrangements that we’ve been in discussion with the company on,” said Gravelle. “Because of the size of this project … there are going to be challenges along the way, but we are still very confident that the project can move forward.”

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More delays in the Ring of Fire mining project – Minister Michael Gravelle and Mining Analyst Stan Sudol (CBC News Sudbury/Morning North – June 13, 2013)

  Cliffs Natural Resources has put the brakes on environmental assessments around it chromite project in the Ring of Fire mineral deposit. We have reaction from the Minister of Northern Development and Mines and an industry analyst Stan Sudol. For Morning North Radio Interview click here: http://www.cbc.ca/video/news/audioplayer.html?clipid=2391133725

Mining Future is Bright for First Nations – by Stan Sudol (Onotassiniik – Summer 2013)

A version of this column was recently published in the premier issue of Onotassiniik, Wawatay’s Mining Quarterly http://onotassiniik.com/

Stan Sudol is a Toronto-based mining analyst, communications consultant and owner/editor of the RepublicOfMining.com website. www.republicofmining.com  stan.sudol@republicofmining.com

While this year’s PDAC mining convention was filled with gloom and doom for both junior explorers and large miners, let’s remember that we are still in the middle of one of the largest expansions of mining activity in the history of mankind. Even in past commodity super cycles – the most recent occurred from the mid 1940s to the late 1970s – there were significant “corrections” but the overall trend was always upwards.

Well-respected Scotia Commodity expert Patricia Mohr recently stated that she feels that there will be a slowdown in exploration and mining activity in the next few years but the “bull run” will return in the second half of the decade.

As hundreds of millions of people in China, India and other developing nations urbanize and industrialize they will need the minerals that we dig out of the ground in northern Ontario and Canada. Mining has always been a boom and bust business and it is no different this time.

However, this slowdown will also give the First Nations surrounding the Ring of Fire a chance to access their training and infrastructure needs, allow ample time to complete and resolve environmental studies – hopefully Cliffs and the federal government will come to their senses and switch to the broader Joint Review Panel Environmental Assessment that most First Nations in the Ring of Fire prefer – as well as resolve outstanding resource revenue sharing issues with governments.

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How many mines can a government open? None – by Brian MacLeod (Sudbury Star – May 4, 2013)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

 Brian MacLead is the managing editor of the Sudbury Star.

It is a bit rich for politicians to announce the potential opening of new mines, but they’ve taken it on as a hobby. During the 2011 election campaign, Sudbury Liberal MPP Rick Bartolucci announced his government could “facilitate the process” so that eight new mines can open in the province over 10 years.

And this week, Sudbury Progressive Conservative candidate Paula Peroni topped that with an announcement that 10 new mines could open over the next five years by removing red tape and killing the Far North Act.

No word whether the NDP can beat that, but it doesn’t matter. Governments don’t make mines happen, private companies do.

What governments can do — as Bartolucci said –is “facilitate” a process, but isn’t that the government’s job? (Unless you’re an NDP government in B.C., perhaps.)

As a former mines minister, Bartolucci would, of course, have had insight into which mining companies were at certain stages in their exploration and permitting and development processes, but a lot of things have to go right in the world before these properties become a mine.

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Bill to process minerals in province quashed – by Jonathan Migneault (Sudbury Star – April 12, 2013)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

“There will be an increasing demand for resources in the next few decades,” Sudol said.
With more resource scarcity, Sudol said, other jurisdictions would have to play by Ontario’s
rules if they want access to its ore deposits, and that could include conditions to process
that ore within the province.

The Ontario Liberals and Conservatives voted Thursday to defeat a private member’s bill that would have amended the Mining Act to require any resources mined in Ontario also be processed in the province.

The bill was introduced by NDP MPP Michael Mantha, that party’s Northern Development and Mines critic, and was defeated after second reading by a vote of 70 to 18.

“My bill would have given Ontario’s mining industry a bright future,” Mantha said in a release after his bill’s defeat. “By keeping our resources in the province, there is the potential of job creation in many sectors. We would ensure that the unprecedented wealth of resources in the Ring of Fire is used to create good value added jobs for Ontarians.”

Mantha introduced Bill 43, An Act to amend the Mining Act to require resources to be processed in Ontario, to prevent situations like the closing of the Xstrata copper and zinc metallurgical plants in Timmins three years ago.

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History of Ring of Fire and Rail or Road for Transportation? [Parts 1 and 2] – by Stan Sudol (February 2 and 4, 2013)

KWG Resources CEO Frank Smeenk holds a core sample from the Big Daddy chromite discovery. KWG with joint venture partner Spider Resources made history by drilling the first chromite discovery hole on March 6,2006, the first showings of this strategic mineral in the Ring of Fire. (Photo by Stan Sudol)

http://www.thesudburystar.com/

This column was published in the February 2 and 4 editions of the Sudbury Star:

http://www.thesudburystar.com/2013/02/02/ring-of-fire-rail-or-road

http://www.thesudburystar.com/2013/02/04/cos-spar-over-ore-transport

stan.sudol@republicofmining.com

Without a doubt, the number one technical issue that will make or break the Ring of Fire’s enormous economic potential – currently estimated at $60 billion (MNDM) for world-class chromite deposits along side nickel, copper and PGMs – is transportation infrastructure.

Located in the isolated James Bay swampy lowlands of northern Ontario, the closest infrastructure to the Ring of Fire is 330 kms south in the tiny community of Nakina where the Canadian National railroad and the end of Highway 584 intersect.

Since Cliffs announced their decision to move their $3.2 billion chromite project into the feasibility phase, last May, and the Ontario Government’s decision to “support in principle” the North-South infrastructure corridor, junior explorer KWG Resources has been largely ignored. This might be a mistake as KWG CEO Frank Smeenk, through the company’s Canada Chrome subsidiary, controls the key strategic transportation route into the region as well as 30% of the Big Daddy chromite deposit.

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Vale cut not ‘fatal’ to city’s economy – by Harold Carmichael (Sudbury Star – January 12, 2013)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

Vale’s decision to cut in half the proposed $2 billion it would spend on a massive pollution-reduction project at the Copper Cliff Smelter site will affect local mining supply and service companies, but it’s not a fatal blow, says Dick DeStefano.

DeStefano, executive director of the Sudbury Area Mining Supply and Service Association, said local companies had about a 25% of Vale’s Clean Atmospheric Emissions Reduction project, which will now cost $1-billion. The members reaction, he said, is the work will be made up somewhere else.

“I haven’t heard one complaint because they made a business decision,” said DeStefano. “No one has called me up saying ‘I am losing a pile of money.’ Our guys are saying ‘let’s move on. There are other markets in other places. If we don’t see it here, there are others. We have to live with it.’”

DeStefano said the good news Thursday is the increased push to develop the Victor-Capre Mine and the Copper Cliff Mine brownfield site, which he said, could lead to $500 million-plus of investment at each site, more than making up for the lost $1 billion from Clean AER.

While he accepts that the Clean AER announcement was a business decision, DeStefano said the Copper Cliff Smelter could run into problems down the road when it operates with just one furnace.

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Mining observer questions [Ring of Fire] Cliffs’ mine start-up date – by Thunder Bay CBC Radio (January 8, 2013)

 http://www.cbc.ca/thunderbay/

Ring of Fire project will likely be delayed for a variety of reasons, says industry watcher

A mining observer and blogger predicts chromite production in the Ring of Fire may not begin until as late as 2020.

Stan Sudol said he believes the fragile global economy — along with challenges related to infrastructure and First Nations communities — will slow development of the mineral zone. But there’s also an upside to a longer wait, he said.

“It gives us a little bit more time to decide exactly what type of transportation infrastructure would be the best for the Ring of Fire and how both Aboriginal and non-Aboriginal communities could best take advantage of this enormous transformational opportunity,” Sudol said.

Cliffs Natural Resources, the biggest company operating in the Ring of Fire, currently has a target start date of 2016. “Cliffs initially said they’re looking at 2016, but then there were some reports of 2017,” Sudol said. “I think a safer bet would be 2019 [or] 2020.”

Chance of takeover

In an e-mail to CBC News, a spokesperson for Cliffs called Sudol’s prediction about the mine’s start-up timeline and the company’s potential as a takeover target “pure speculation” on his part.

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Ring of Fire – Miles before we dig (Part 2 of 2) – by Stan Sudol (Sudbury Star – January 7, 2013)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

The Ministry of Northern Development and Mines estimates the value of the current known chromite deposits at US$50 billion over its 30-year lifespan. Noront Resources is developing a nickel/copper mine with a current 11-year lifespan.

The mineral deposit is “open at depth,” which means that even though official TSX regulations will not allow you to estimate the potential size of the orebody, most feel that mine will be in production for much longer.

The Ring of Fire mining camp will become bigger than the nickel mines of Voisey’s Bay, Nfld., and Raglan, Que. combined. It’s bigger than diamond deposits in the Northwest Territory or the uranium mining district in northern Saskatchewan.

We have just begun to explore this geologically rich mining region that will probably equal, if not exceed, the legendary trillion-dollar Sudbury basin. These developments, and potentially many more to follow, will significantly alleviate impoverished living conditions in the adjacent Aboriginal communities, as well as provide enormous economic benefits for the entire province.

But how are the First Nations going to build their capacity and take full advantage of these extraordinary job opportunities — and, most importantly, give their consent to sustainable development of their traditional territories — when many, if not most, of them are living in deplorable conditions?

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Accent: Ring of Fire – Miles to go before we dig [Part 1 of 2] – by Stan Sudol (Sudbury Star – January 5, 2013)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

It may be a cliche, but over the past six months, how things have changed and how they’ve stayed the same in the Ring of Fire.

There may be some ongoing activity or discussions behind the scenes, but without a doubt, the declining state of the global economy, First Nations issues and Ontario politics seem to have halted any progress on a variety of issues.

First let’s look at the fragile nature of the world economy. The U.S. is still struggling; Europe is worse, with skyrocketing unemployment rates in many countries; and China’s past double-digit expansion is gone. It is estimated that their economy will “only” grow 7% this year.

The price of commodities and the value of resource companies have plummeted. Many mining projects are being put on hold or cancelled, while layoff notices are being handed out. Funding for junior exploration companies — the source of future discoveries like the Ring of Fire — has become almost impossible to find, putting many on life support.

The stock price of Cliffs Natural Resources has plummeted from US$100 per share a year and a half ago to a little under US$30 recently.

Cliffs has publicly stated that they are looking for a partner to help develop their Northern Ontario chromite deposits. Recently, the company has put their Bloom Lake iron ore expansion project in Quebec’s Labrador Iron Trough on hold and stopped production at two of their U.S. iron ore mines.

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