January 2014

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Page 47 of 75

Ring Of Fire Cools, But Canadian Prospects Are Generally Hot A Closer Look Chromite mining in Northern Ontario – with epic potential – isn't the country's one-hit wonder; resources and infrastructure projects are smokin' all over. TOM VAN DUSEN JR. Northern Ontario's Ring of Fire may have cooled off for the time being, but in several other areas of Canada construction projects are looking hot, hot, hot right through 2014 and into 2015. They'll heat up even more when Ring of Fire takes hold again. All those with a stake in the mega mining venture insist it's a matter of when, not if. "Ring of Fire," is best known as a song made famous by Johnny Cash, but in a remote part of Ontario, 250 miles northeast of Thunder Bay, the borrowed title has also come to identify what many predict to be one of the biggest financial opportunities the province and perhaps the country has ever seen. It's the name given to a massive chromite mining and smeltering project in the mineral-rich James Bay lowlands, some 3,000 square-miles in all, centered on McFaulds Lake. The tantalizing possibilities have attracted more than 35 mining and exploration companies to the area. The nickname was bestowed by Sudbury lawyer turned mining entrepreneur Richard Nemis who made the first significant mineral finds in the area – apparently for no other reason than he's a devoted Cash fan. Ring of Fire stuck and now senior politicians such as Canada's Treasury Board President Tony Clement are singing the praises of the project. Clement claims the region could become the economic equivalent of the Athabasca oil sands, with potential for generating as much as $120 billion in economic activity. He adds that it represents a once-in-a-lifetime opportunity to create jobs and long-term prosperity for Northern Ontario and the nation. Clement has been looking to business, not the federal government, to invest in the power and transportation infrastructure necessary to develop the deposit. So far, so good! But let's not forget that it "burns, burns, burns, the Ring of Fire." Much of the infrastructure investment had been resting on the shoulders of Cliffs Natural Resources, a U.S. international iron ore and coal mining company, which, in November, announced it is indefinitely ceasing participation in the chromite project. Cliffs decided not to allocate additional capital given the uncertain timeline and risks associated with installation of the infrastructure. It previously suspended the environmental assessment process because of issues impeding progress. By the end of 2013, Cliffs planned to reduce its project team and close its offices in Thunder Bay and Toronto, as well as the exploration campsite. The company emphasized that it still believes in the value of mineral deposits and future potential of the Ring of Fire and will continue to work with the Ontario government, First Nations and other interested parties to explore solutions related to the "critical issue" of infrastructure. Following Cliffs' estimated $3.3 billion pullout, some analysts have described the project economics as "questionable at best." "I went down, down, down, and the flames went higher," we hear Cash echo. Ontario Minister of Northern Development and Mines Michel Gravelle wasn't singing the tune and didn't seem to feel the burn when he learned of Cliffs' decision. On the contrary, he made a bold pronouncement that the Ontario government would continue to work toward success of the Ring of Fire. (continued on page 48) 46 | www.cedmag.com | Construction Equipment Distribution | January 2014

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