Overcoming difficulties as the ‘Ring of Fire’ advances towards production
By Leonard Melman
Without doubt, mining has played a primary role in the history of the province of Ontario. Previous exploration and development resulted in numerous highly productive mines which have brought wealth, jobs and opportunities to tens of thousands over the past century or more. Cities and towns sprung up in the wilderness and entire new industries have been born as a result of mining.
And now, another relatively new region with virtually unlimited potential has become part of the Ontario mining picture. We are referring to the metals exploration area known as the “Ring of Fire” (ROF or Ring).
The Ring is located approximately 500 kilometres north of Thunder Bay in a lightly populated area of northern Ontario, west of James Bay and north of CN’s main east-west rail line through Nakina. Significantly, it is an area with limited to nonexistent infrastructure as no road or rail transportation currently exists into the ROF.
Quite surprisingly, the discovery of the region’s potential immense mineral wealth, particularly chromite, came about purely by accident in 2002 when DeBeers Canada was searching for diamonds. Word of possible valuable ore bodies gradually spread, but the true exploration frenzy was ignited in 2007 with the publication of assay results by Noront Industries Ltd. at its Double Eagle Project. Extensive exploration work ensued and by June 2008, Noront was able to publish a “Technical Report and Resource Estimate” which showed indicated resources of 79.2 million pounds Ni; 47.6 million pounds Cu; 9,100 ounces Au; 66,200 ounces Pl; 230,500 ounces Pd and 224,100 ounces Ag.
Within a short while, 35 companies or prospectors had filed claims in the region; but it was the development of the Black Thor Project’s chromite ore body by Cliff’s Natural Resources subsequent to their acquiring that property from Freewest Resources and Spider Resources for $240 million in 2010 that truly illustrated the huge wealth-generating possibilities of the ROF.
Besides Noront and Cliff’s, other mining companies active in the ROF include well-known names such as KWG Resources, Probe Mines, Macdonald Mines Expl., Slam Exploration Ltd., Temex Resources and Trillium North Minerals.
Chromite itself is used primarily as an alloy in the production of stainless steel. Four countries currently account for 80 per cent of world chromite production, including distant nations such as South Africa, Kazakhstan, Turkey, and India while major consumers include China at 50 per cent of supply and the U.S.A. at 15 per cent.
To date, most ROF exploration and development has been confined to a 12- by 20-kilometre zone lying inside its 5,000-square-kilometre overall area; within that relatively small zone, total mineral values variously estimated at between $50 billion and $100 billion have been discovered. Several estimates point out that if the ore-bodies are to be brought into full production, the expenditure of several billion dollars for refineries, production facilities, and mining equipment would occur and that many hundreds of high-paying jobs would likely become available.
However, serious moves toward ultimate production have been impeded in recent years. These difficulties have fallen within three categories: infrastructure, environment, and aboriginal.
In terms of developing sufficient infrastructure to fully bring the ROF’s potentially huge mineral resources into production, enormous expenditures would likely be encountered for road or rail construction plus power generation on the order of approximately 300 Megawatts – greater than any existing electricity customer in Ontario. Expenditures for infrastructure advancement on the required scales are believed to be beyond the ability of any private corporation and so both the Ontario and federal governments have set up agencies to resolve this difficulty.
The provincial government has recently set up a Ring of Fire Secretariat to advance mining developments under the leadership of Christine Kaszycki. In a recent statement to the press, she noted that if the ROF can be brought into production, “…The entire province will feel the positive economic impact, especially the north with its mining consulting and equipment industries, as well as its supply and service sectors. We have to get it right, especially for the Aboriginal communities…”
As might have been expected, environmental groups appear to be united against developing the ROF. In a recent edition in early November 2013, the influential Toronto Star newspaper asked for comments from their readership; among the responses, readers objected to the development because it could lead to dewatering of huge areas of peat bog; impairment of the natural habitat for animals such as bears, wolves, caribou and so forth; groundwater contamination and, in general, the degradation of a presently pristine region on a scale comparable to the tar sands of Alberta.
Ironically, advocates of fully developing productive mines point out that enterprises on such an enormous scale have the potential to advance the general economic structure of presently cash-strapped Ontario in a manner similar to the economic contribution of the tar sands to Alberta.
Aboriginal communities appear to be taking a moderate stance, whereby they would appreciate the economic and job-training benefits which would accrue from mining in their territories, but they are also deeply concerned about preserving their natural environment.
To date, several of the leading companies have expressed disenchantment with the slow pace of negotiations between industry, government and aboriginals and a few projects have been suspended, at least temporarily. However, there is general agreement that given the potential positive economic impacts related to ROF development, these conflicting problems will be resolved.
We might add: the sooner, the better.