All KWG Longs....see article that appeared in the National Post today by Conrad Black.  Spectaculor (and well deserved)  coverage for KWG.  And the best part is that he intends to become a shareholder!  Could your see him among us on this Board?  If this article doesn't get Trudeau's attention, then really what will. 

My best to all KWG longs,

Keep Digging  

National Post

July 15, 2023

Conrad Black: The natural resources project that the Liberals can't be allowed to fumble

Regular readers will recall that from time to time I inveigh in this space against the uncompetitive economic performance of this country as we slip steadily down the list of the world’s most prosperous per capita incomes and we suffer every year from negative capital flows: more Canadian capital invested outside Canada than Canada attracts from foreigners. The present federal government seems to wish to discourage our primary industry sector, that is all natural resources, though particularly the oil and gas industries. What the world envies about and most needs from Canada is that it is a treasure house of almost all forms of energy, forest products, base and precious metals and non-tropical agriculture. Pierre Trudeau was periodically mesmerized by the anti-economic growth pieties of the Club of Rome, and astonishingly for a man of his high intelligence, did not grasp the importance and desirability of economic growth until its absence endangered his own political incumbency.

The present Trudeau government has many of the same prejudices and inhibitions with the excuse that this bearer of the famous name of the only family that has contributed two prime ministers to Canada is less intellectually exalted than his father. But where Pierre Trudeau’s government wished to amplify the oil and gas business and confiscate an unjustifiable amount of its profit for redistribution to its own political ends, the present Trudeau government is ashamed of our resources and generally sees them as a blight on Canada as the pure snow maiden of the North and an unpardonable contribution to its fantastic conjuration of an existential challenge posed by apparent changes to the climate.

Providentially, there has now arisen an opportunity for this country to take a dramatic step forward in the sensible exploitation of our natural resources, to the benefit of the economy generally, and specifically of the long-wronged and misgoverned native people of Canada, while contributing importantly to the strengthening of the security of the Western world. It is a truly fortunate nationality that by sheer good luck has presented to it an opportunity to address simultaneously three of its greatest public policy failings. At one stroke we are offered a bonanza that will stimulate the national economy, make good for a significant number of Indigenous people for over a century of inadequate attention to their needs and rights and substantially address our inexcusable status as a freeloading slacker in the western alliance.

The opportunity is in the recently discovered wealth of the Ring of Fire mining resources about 550 kilometres north of Thunder Bay, Ontario. One of the largest deposits in the world of chromium, the principal ingredient in stainless steel and a vital component in high technology and sophisticated military equipment, has been discovered in the Ring of Fire. The United States and China are in direct strategic competition for chromite: they have the same needs and have both been looking for a new source of supply. As in so many other resources, Canada proves to be overwhelmingly fortunately endowed, and China has been nibbling to get into the Ring of Fire since 2011.

Gradually, stainless steel, which is much stronger and more durable than steel that rusts, will occupy as much of the steel market as it can supply, but it will fill an absolute scientific and military requirement that is indispensable to the current and future military security of the western alliance. It is easy to overlook the role of resources in the strategic policy of the great powers and particularly in military conflicts.

The Japanese attacked the United States in 1941 because president Roosevelt was so outraged at the barbarous Japanese invasion of China and Indochina that he exploited the fact that his country supplied 85 per cent of Japan’s oil and withheld oil exports to Japan until it desisted from its aggression. In fact, he knew that Japan would be too proud to back down and saw this as the only way to bring America into the Second World War with broad public support for the war effort. He had concluded that without American participation in the war, it would be impossible to re-establish democracy in western Europe and assure the security of Western civilization from aggressive anti-democratic forces in Eastern Europe and East Asia. All of his strategic calculations were accurate.

For similar reasons, the Germans sent Field Marshal Rommel’s Afrika Korps to Libya and Egypt to try to seize the Suez Canal and the Mid-East oilfields and starve the British Empire for oil while assuring their own and Japan’s supply of it. The most important land victory of the British Empire in the Second World War was at El Alamein in Egypt in November 1942 when the German assault towards Suez and the Middle East oilfields was repulsed.

The principal co-discoverer of this huge deposit in the Ring of Fire is KWG Resources Inc. which carries on business as the Canadian Chrome Company, and has already developed a comprehensive plan for the environmentally friendly extraction and transportation to market of the chromite and has provided for the First People of the area to have their rights completely protected and utilized by directing all extraction and transportation operations and receiving 50 per cent of the entire net profit for the life of the mine. (Disclosure: I intend to make a modest investment in the company.)

About $1 billion will be required to bring this mighty and strategic windfall into production, under the supervision of the native residents, who have been shortchanged of infrastructure throughout the history of Canadian Confederation. What is necessary to set this in motion is a take-or-pay contract from the government of the United States, a completely logical step in a vital area of U.S. national security, and one that would be sufficient to assure full private sector financial market funding for the project. Rio Tinto, one of the foremost mine operators in the world and with an extensive and successful operating history in Canada, has been invited to be the project manager.

Everything is in readiness, including absolutely comprehensive environmental research and assessments. All that now remains is the negotiation of the conceptually simple contract, vital to the national security of the United States, Canada and all of our allies, by which the U.S. government undertakes to buy enough of the chromite production of the mine to justify its development, apart from what Canada might wish for its own requirements.

On this, unlike what has happened so often elsewhere in the Canadian resource sector, there absolutely must not be any government fumbling, foot-dragging or pusillanimous irresolution. To take a line from the most critical days of the relationship between the two great statesmen who led the Western Allies to victory in the Second World War, “In the long history of the world, this is something to do now.” (Winston Churchill to Franklin D. Roosevelt, July 31, 1940)

National Post