Ontario government lends support to chromite project

May 10, 2012

A proposed $3.3 billion chromite mine, transportation corridor and processing facility in Northern Ontario’s Ring of Fire region called the Black Thor project received support from Ontario’s provincial government when Finance Minister Dwight Duncan said the Ontario government had reached a term sheet or initial agreement with Cliffs Natural Resources regarding the deal.

The Ring of Fire, located 500 km (310 miles) northeast of Thunder Bay, is said to contain one of the world’s largest chromite deposits. Global mining companies have staked nearly 9,000 claims in the ring.

Both the federal and provincial government wants to hasten development of the area to bring much needed jobs to the struggling north. However, environmentalists and First Nations fear environmental assessments will be hastened or bypassed in order to keep Cliffs in Ontario, the Toronto Star reported.

The Cliffs Chromite Project is expected to have substantial benefits in the Far North, and in northern Ontario. The entire project could employ as many as 1,250 people.

The Black Thor deposit is expected to yield up to 4.4 Mt/a (4.8 million stpy) of crude ore, which would be delivered to a C$1.8 billion chromite processing facility near Capreol, north of Sudbury.

It is expected that the first 10-15 years of mine life would involve two openpit operations with a possible transition to underground mining later on.
In addition to the mine and the smelter, Cliffs would also develop an integrated transportation system to link all project components and a ferrochrome production facility to manufacture the ferrochrome product.

The transportation system includes an airstrip, permanent all-season road, a load-out facility at the mine site to load haul trucks with concentrate, and a transload facility near or within Greenstone where concentrate would be transferred to railcars.

The final step will be to refine concentrates into ferrochrome metal for use in stainless steel manufacturing in North America and globally.
Cleveland-based Cliffs said in a news release.

Several communities were considered for the chromite smelter including Sudbury, Timmins, Thunder Bay and Greenstone. First Nations groups had favored a location along the Canadian National Railroad Line between the towns of Aroland and Nakina.

Sudbury was selected as the location of the facility “due to various economic and technical factors that would best support the viability and success of the overall project, including transportation logistics, labor, long mining tradition, community support and access to electrical power,” said Cliffs.

Before Cliffs can make a final decision on the project in its entirety, the company must receive provincial and federal environmental assessment approval, negotiate mutually acceptable agreements with First Nations communities, work with governments to address the lack of infrastructure in the Ring of Fire and complete its commercial and technical feasibility studies.

Cliffs anticipated that a majority of the project's capital requirements would occur in 2014 and 2015. The company hopes to commence production at Black Thor in 2015.

Cliffs is just one of more than 20 mining companies holding claims in the Ring of Fire, which is also believed to hold the potential for significant production of nickel, copper and platinum.


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