Noront Resources to make decision on Ring of Fire smelter by end of year

The provincial government announced plans to begin development on road infrastructure to the Ring of Fire mining development in northern Ontario. Noront Resources has a major land position in the area. The company says it will decide by the end of this year which community will be home to its chromite smelter. Sudbury, Timmins, Sault Ste. Marie and Thunder Bay are on the short list.

Mining company to work on smelter development while province, First Nations create road infrastructure

Noront Resources Ltd. will decide by the end of 2017 which one of four northern Ontario communities will be home to its chromite smelter, similar to this Vale smelter in Sudbury, Ont. (Gino Donato/CP)

Monday's long-awaited news that the provincial government will help build roads to the Ring of Fire chromite deposit is music to the ears of junior miner Noront Resources Limited.

The provincial government says it's working with three remote northwestern Ontario First Nations to develop year-round road access that will link the communities to Ontario's highway system.

Noront has a major land position in the Ring of Fire.

CEO Alan Coutts said the announcement from Ontario Premier Kathleen Wynne was welcome.

"It's a very important breakthrough. This is exactly what was needed to de-bottleneck the Ring of Fire development," Coutts said.

While in Thunder Bay, Wynne told the media the environmental assessment will begin immediately and should take much of 2018 to complete. Construction on the roads should start in 2019.​

Noront has already conducted its own environmental baselines and potential route corridors. It's prepared to share this information with the government and the First Nation communities involved, Coutts said.

The proposed all-season roads (shown in pink) for the Ring of Fire development in far northern Ontario. Construction will begin in 2019. (CBC)

First minerals to be transported down road to Sudbury

The first mine developed in the Ring of Fire will be Noront's Eagle's Nest project. It's a high grade nickel, copper, platinium, palladium deposit. Mine development will cost between 600 to 700 million dollars.

"That mine will take five years from now to see a mineral concentrate coming from the Ring of Fire to Sudbury for processing," Coutts said. 

He said the the ore produced will be transported down the new road to Sudbury.

"The reason we selected that site as the first mine is because there's already existing smelting capacity for those minerals in Sudbury," Coutts said.

Soon after that, Noront will then develop its chromite deposits.

That material will be processed at a ferrochrome smelter, the location of which is still to be decided.

Noront is looking at specific sites for that facility and has shortlisted four northern Ontario communities. The company has been speaking with representatives from Sudbury, Timmins, Sault Ste Marie and Thunder Bay.

"We've advanced that conversation significantly," Coutts said, adding that the company expects to have a location decision made by the end of this year.

"Permitting [of the smelter] will take a long time and we know we have to get out ahead of this because it will be a long process of environmental assessment."

Sudbury city councillor Al Sizer says the Nickel City would be a great choice.

"It's a viable community, we have the workforce, and we have all of the amenities that a larger centre requires to take care of staff, and services that the industry will require."

"Noront Resources has suggested that there will be up to 500 full time jobs, plus all of the spinoffs. So it is a big, big part of our future," Sizer said.

Coutts told CBC News he is unsure how big a workforce Noront will need for its Ring of Fire mining development, or its smelter facility, however the company does want its employees to be as local as possible.

Noront Resources is still actively exploring the Ring of Fire region. Coutts says 60 to 65 per cent of the workers hired to do this exploration are First Nation men and women.

Economic spinoffs

The smelter facility will bring huge economic spinoffs to whichever community is chosen, says Bruce Jago, the executive director of the Goodman School of Mines at Laurentian University in Sudbury.

"Jobs related to building it, you've got materials, you've got people. And then once [the plant is] built you've got people and materials still. So it's going to be a major boost to whatever municipality they decide on," Jago says.

Jago calls the road infrastructure news a monumental change and good news for the mining industry in northern Ontario.

Once the Ring of Fire mine is operational there will be a great need for workers. Jago says that could mean changes for post secondary institutions that offer mining programs.

"I think you'll see spinoffs going into places like Laurentian [University], Cambrian [College], College Boreal or Lakehead University or Confederation College. There's going to be spinoffs into those educational institutes to some degree as well."

Bruce Jago, executive director of Goodman School of Mines in Sudbury, Ont., says there are not enough purchasers of nickel, thanks to less demand from China and recession in European countries. (Goodman School of Mines)
Bruce Jago, executive director of the Goodman School of Mines at Laurentian University, weighs in on the province's pledge to work with three First Nations in the region to build year-round road access into the Ring of Fire. 5:29

Worth the wait?

When the Ring of Fire mining development first started to make news more than a decade ago there were many different mining companies involved. Coutts says those claims have all been consolidated.

"We're the last one standing."

The company's shareholder base has been very patient as it worked through all the complexities with the Ring of Fire project, said Coutts.

In order to finance the mining project the debt and equity players had to be satisfied that there would be a route developed, so their money wouldn't be at risk.

News that the transportation corridor will be built allows Noront resources to finance the project, build the mine and build the ferrochrome treatment plant.

"Major shareholders...have thought that the reward was sufficient, that we should take the time and hang in there. I hope they feel vindicated now."

With files from Olivia Stefanovich