Cliff's suspends its $3.4 billion Black Thor project

June 14, 2013

Cliffs Natural Resources Inc. announced that it will suspend work on the Black Thor project, a $3.3 billion chromite-mining project in northwestern Ontario, because of stalled talks with the Ontario provincial government and on other political and regulatory problems, Reuters reported.

The announcement is a setback for the development of the Ring of Fire area, is a large cluster of mineral deposits about 1,500 km (1,000 miles) northwest of Toronto, that Canadian political leaders have said could bring economic development to northern Ontario much as oil sands have to northern Alberta.

There are no rail lines, highways or reliable power sources in the region, and Cliffs’ plan for Black Thor includes a $600 million highway that could open the zone to smaller mining companies such as Noront Resources Ltd that are developing projects or have claims there.

Noront’s current plan is to use Cliffs’ proposed north-south road to ship concentrate from its Eagle's Nest nickel, copper and platinum group element project, but Chairman Paul Parisotto said an east-west route was a viable alternative.

Noront is the highest-profile of several junior mining companies with interests in the Ring of Fire, including Probe Mines Ltd and Fancamp Exploration Ltd.

The Ontario government effectively appointed Cliffs to lead development in the region last year, when it drafted a non-binding agreement to support the highway. But talks were put on hold when Kathleen Wynne took over as provincial premier in January, Reuters reported.

The province’s Ministry of Northern Development and Mines said it has a “close relationship” with Cliffs: “We will continue to work diligently to finalize many aspects of an arrangement that would bring this significant investment to Ontario,” said an emailed statement attributed to Minister Michael Gravelle.



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