Ontario's Ring of Fire

Tuesday, 11 November 2014

Interview with a Quaternary Geoscientist

We interviewed Dr. Andrew Bajc, a Quaternary Geoscientist from Sudbury, Ontario on issues regarding the Ring of Fire. In his occupation he studies the deposits and landforms left by the glaciers over the last few hundred thousand years in Ontario.

What is your involvement in Northern Ontario’s Ring of Fire?

I work for the Ontario Geological Survey, a branch of the Ministry of Northern Development and Mines. Our branch undertakes geoscience projects in the Ring of Fire area to help understand the geology and setting of mineralization in the region. We also do baseline geochemical studies to obtain a picture of the environmental conditions of the region prior to development. This is important should there be impacts on the landscape and drainage systems from the mining operations. We also map the surficial geology of the region to provide information required for infrastructure development. Knowing the location of aggregate resources for road building, clay for tailings ponds as well as determining optimal routes for road construction is critical to the success of this project.

What do you believe is the biggest factor slowing the development of the mining operation?

First Nations issues and infrastructure development. Need all season access to the site to construct infrastructure and transport people and ore out from the deposit area. An all season road is required. Also need full buy in from First Nations. Revenue sharing and employment of first nations peoples needs to be negotiated.

What potential do you see in the area?

The chromite ores of this region are world class and will definitely be mined at some time in the future. There are also other commodities of interest in this area including nickel, copper, platinum group elements, etc. making the region all that more attractive to the minerals industry.

How will this affect northern Ontario in the long run?

The Ring of Fire development will have a huge impact on northern Ontario. Jobs will be created not only at the mine site but in locations that support the mining industry such as Thunder Bay, Sudbury, etc. The revenue gained for the province through the tax base will mean a stable economic condition. The mining camp is predicted to have a life of well over a half a century. This should help keep the northern economy going.

If you were in charge, how would you approach the situation? As in, what types of steps do you think need to be taken to get all parties involved to see eye to eye?

Form a corporation consisting of representatives from all parties involved to develop strategies for moving forward on this project. Tackle the revenue sharing issue as well as the road construction planning. The new all season road should also service the remote first nations communities of the far north to make the project more attractive to them.

-S
Posted by Samantha Bajc and Daniel Watchorn at 17:53

3 comments:

Fred Brown12 November 2014 11:11

The province of Ontario supported Cliffs Natural Resources application for an easement to build a private corporate toll road over KWG Resources north south mining claims for rail. However, the case is still in the appeal process before the Court of the Ontario Superior Court of Justice.

A good question for Dr. Andrew Bajc would have been, could an east west all-season road be able to physically deliver the $50B worth of bulky chromite concentrate from the Ring of Fire to market economically? The $10B worth of nickel concentrate, or 150,000 tons per year, can travel by an east west route economically, but nickel alone will not justify the mining and infrastructure investment and allow for adequate revenue sharing with local First Nations.

Ontario's $1B ROF commitment predicates a solution to which form, (road, rail or slurry pipeline) and which route or combination there of, (Northern East West, Southern East West or North South), is best for transporting chromite ore from the Ring of Fire to supply and deliver chromium concentrate, ferro-chrome, and nickel at the lowest long term competitive world price. This is an issue that Ontario's Development Corporation must decide before all else.

There is no question that a light service east west road should be apart of the plan, but the route should be selected to service and minimize the costs of building the north south rail way. Apart from the needed chromite early revenue streams, sparse area aggregate and it's transport to mines and roads in the area, and $10 per ton verses $60 per ton transport costs are reasons why the north south rail should be built in conjunction with an east west service road.

What good are meager nickel revenue sharing agreements with First Nations if the $50B chromite is not included in this equation. The Deloitte report on the subject should be completed for the Devco.

North Bay Mayor, Al MacDonald, one of Ontario's ONTC Ministerial Advisory Committee members, said that Ontario’s divestiture disguised as a transformation plan for the ONTC had "placed it on life support". The mayor explained that Ontario’s creation of a "development corporation" was not needed. All the pieces were there already to move the ONTC into the "James Bay & Lowlands Ports Authority". Ontario could have saved much time but time to move on with their Devco.

It appears that Dr. Bajc sides with Cliffs Natural Resources or now, Noront Resources, who is actively pushing it's Northern East West (adjusted to appease Marten Falls)' all weather road application to the Ontario government. This would give Noront a leg up on all the other companies invested in the Ring by precluding a Devco infrastructure decision, allowing them time to develop it's nickel to finance a north south rail road for a chromite monopoly.

KWG Resource's plan is to develop rail at the same time as road and reduce the unprocessed chromite ore using either a southern or northern mine site 'natural gas super reducer (GSR)' in place of the combination of a northern ROF mine site $800M "electric concentrator" and a $1.8B southern electric powered ferro-chrome smelter, saving at least 50% in reduction costs.

The fundamental issue has always been the supply and delivery of chromium concentrate, ferro-chrome, and nickel at the best long term competitive world price while obtaining social license through provision of needed infrastructure to mine and local communities respecting conservation environmental models.

Cliffs backed out because even after Ontario gave it power subsidies, money for it's private all-season mine toll road, exemptions to ship 50% of the concentrate to Asia, it's business model was not competitive.

Canadians and Ontarians should not be forced to pay for a large part of the private mine 'road, rail or pipeline' infrastructure, subsidize corporate electrical power rates and see a large part of semi-processed natural resources leave Canada.

'You have to keep your costs low with any project, let alone a project on this scale.', KWG Resources Ltd.'s vice president Maurice Lavigne said in Sudbury, Ontario, on April 3rd, 2014. 'A railroad drives down your cost, the gas drives down your costs' Lavigne told reporters after speaking to a noon crowd at a luncheon held by the Greater Sudbury Chamber of Commerce.

It's time for Gravelle and Wynne to move on the infrastructure decision.

Bring in the Matawa Chiefs, Mushkegowuk council, Nishnawbe Aski Nation, Anishinabek Nation, Métis Nation of Ontario, mayors of Thunder Bay, Sault Ste Marie, Timmins, Sudbury, North Bay, the ONTC, it's unions and the Ministerial Advisory Committee, and mining companies with local claims.

Provide the Devco participants with reports from Deloitte, the Ontario Far North Science Advisory Panel, and Northern Policy Institute and various other submitted plans.