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Minister Gravelle Updates Mining and Ring of Fire

THUNDER BAY – Thunder Bay Superior North MPP, and Minister of Northern Development, Mines and Forestry, Michael Gravelle was the special guest of the Port Arthur Rotary Club in Thunder Bay today.

Minister Gravelle was updating the Rotarians on the Mining Act and the “Ring of Fire”.

Here is the text of the Minister’s Remarks:

It’s a privilege to join you once again. And, I am especially honoured to help launch Port Arthur Rotary’s New Year.

On that note, let me offer to each and every one of you my most heartfelt wishes for good health and good fortune in 2011.

Today, I will update you on two of Ontario’s major initiatives:

(1) modernizing the Mining Act; and

(2) the Ring of Fire development in the Far North of Ontario.

Let me start with a brief progress report on MAM — Mining Act Modernization.

As you know, the minerals sector is one of Ontario’s major economic drivers.

When we set out to modernize Ontario’s Mining Act, we wanted to strengthen our minerals sector through clear rules and regulations, as well as with streamlined administrative processes. Amending the Act will result in a more balanced approach to mineral exploration and development, and will help keep our mining industry competitive and responsive.

It will mean mineral activities that . . . .Respect surface rights holders, landowners, First Nations and Métis communities, and Aboriginal Treaty rights; and Respect the environment and foster economic development through infrastructure such as roads, rail and energy.

Just a few days ago, the first series of new regulations was launched.

As of January 1st:

Private landowners can now seek withdrawals of Crown mining rights on their property in Northern Ontario so that no mineral exploration will take place on the land; and

They can apply for exemptions from the Mining Land Tax under certain circumstances, such as when the land is not being used for mining.

Most new Mining Act regulations and policies will be phased in over the next two to three years, and are expected to introduce:

New protection for sites of Aboriginal cultural significance;

A paper staking system for claims in southern Ontario, allowing applications for claims to be made using a map; and

A graduated permitting system providing clearer rules about exploration activities.

I encourage you to visit the Mining Act section of our Ministry web site for details and regular updates.

Now I’d like to focus my remaining time on the Ring of Fire. I’m very excited to tell you more about this area in the Far North of Ontario.

As many of you probably know, this area has not only captured people’s attention in Ontario and all over Canada, but it has also garnered quite a bit of global interest.

For those who are not familiar with it, the “Ring of Fire” is located in a remote area situated in the James Bay Lowlands near McFaulds Lake. It’s home to one of the most promising mineral development opportunities in Ontario in more than a century.

The region of specific interest covers an area of more than 5,000 square kilometres, although most discoveries have been made in a much smaller area — roughly 12 to 20 square kilometres in size….

Discoveries that include chromite, nickel, copper, zinc, gold and kimberlite – with the most significant finds being chromite and nickel.

In fact, some estimate the potential for more than a hundred years of chromite production.

Chromite is used mainly as an alloy to produce stainless steel. It simply has no substitute, making it a very valuable resource.

Currently, 75 per cent of the world’s chromite is found in the eastern hemisphere. South Africa accounts for 38 per cent of production, and Kazakhstan and India are the next largest suppliers at 18 per cent each.

The Ring of Fire could become one of the world’s largest discoveries of chromite, and the only one in North America. In fact, the deposit could potentially supply all North American markets in the stainless steel and defence industries.

Both Cliffs Natural Resources, which is interested in bringing its chromite deposits into production, and Noront Resources, which is planning to develop its nickel discoveries are targeting to launch production in the Ring of Fire as early as 2015 or 2016.

It’s a very ambitious timeline, but we will be working diligently to support this goal.

As you can imagine, there are any number of aspects to this initiative that will require careful co-ordination and planning.

As companies move forward with their project planning, Ontario will play a key leadership role in co-ordinating discussions on infrastructure planning at a variety of different levels.

As more companies become actively engaged in exploration within the Ring of Fire, we’ll need to ensure that exploration infrastructure is developed in a manner that minimizes environmental impacts.

But, that still provides opportunities for local communities and service providers to participate during this early stage of development.

Ontario will also play a significant leadership role in facilitating regional infrastructure planning for roads, rail and, potentially, transmission.

I met recently with the key industry players in the Ring of Fire.

They’re currently in the process of developing project descriptions that will set out the economic “base case” for infrastructure and processing requirements on an individual company basis.

A range of alternatives will need to be considered against the “base case” scenarios.

As a result, a major component of our government’s role will be to coordinate these discussions and ensure that infrastructure planning and future development adequately meet industry, community and regional needs.

We are also focusing our efforts on putting forth the best possible business case to secure investment in ferrochrome processing facilities in Ontario. [A high percentage of chromite ore is converted toferrochrome, a key ingredient in the production of stainless steel.]

One reason why I believe we’ll be successful in setting up these processing facilities here in Ontario is our government’s new tax plan for jobs and growth – which includes significant business tax relief.

For example, reducing corporate income tax rates to 10 per cent over the next three years will dramatically improve our competitiveness on an international scale.

In fact, by 2012, Ontario’s combined federal provincial corporate income tax rate for manufacturing and processing will be 25 per cent – a full eight per cent better than the most competitive U.S. states, and more than 11.5 per cent better than the entire Great Lakes states.

As well, changes to electricity pricing for large industrial users will also help to create a competitive framework for investment, including changes to the global adjustment for large electricity users and Ontario’s Northern Industrial Energy Rebate program.

I can assure you that we will continue working diligently to ensure that Ontario benefits from value-added opportunities such as ferrochrome processing and a wide range of opportunities in the supply and services sector. The Ring of Fire is a tremendous economic opportunity for our province, and I want to make this opportunity a reality.

The Ring of Fire will also bring significant benefit to Aboriginal communities in the area.

Communities of the Matawa Tribal Council are among those most directly impacted by development of the Ring of Fire. Of the nine communities within the Tribal Council, five are remote, fly-in-only communities and four are road-access communities.

Remote First Nations communities such as Webequie and Marten Falls are among those most directly impacted by mining development in the Ring of Fire.

An even broader range of communities will potentially be impacted by development of regional infrastructure.

We have been working with Matawa Tribal Council communities for several years, both through the tribal council itself, and on an individual community basis.

Most recently, Ministry of Natural Resources Minister Linda Jeffery and I signed a Letter of Intent with Marten Falls and Webequie First Nations to work together on a series of initiatives that will help build community capacity and increase economic development opportunities associated with the Ring of Fire.

We continue to work closely with these communities. And, we look forward to signing Memoranda of Understanding with each one in the near future, to further solidify our working relationship.

We have also been directly engaged with the Federal Government through the Department of Indian and Northern Affairs Canada to ensure that capacity funding is directed to individual communities and the tribal council as appropriate.

In addition, Ontario has announced significant initiatives aimed at building capacity and community supports associated with the Ring of Fire.

In the 2010 provincial budget, we committed $45 million over a three year period toward a Northern Training Partnership Fund to help Aboriginal Peoples and northerners develop their skills in order to benefit from emerging economic development opportunities like the

Ring of Fire.

We have also committed $10 million in funding for First Nations communities that are working with Ontario on land-use planning. Currently, all Far North communities within the Ring of Fire area have initiated land-use planning initiatives at some level.

We remain committed to working with our Aboriginal partners to foster opportunities to benefit from and participate in economic development and business opportunities, and to develop the social supports and capacity needed for success.

I look forward to meeting with communities again in the coming months to grow our relationship and strengthen partnerships on this historic initiative.

Lastly, let me update you on the province’s new Ring of Fire Secretariat, another significant initiative announced in the last budget.

You know from news reports that we recently hired a Ring of Fire coordinator.

Dr. Christine Kaszycki, previously Assistant Deputy Minister of our Mines and Minerals Division, is now co-ordinator of the Ring of Fire. We are extremely fortunate to benefit from her broad experience and expertise.

As executive lead, Dr. Kaszycki is making certain that opportunities generated by the Ring of Fire benefit northern communities and private-sector businesses throughout the province. She is bringing together all the major players to ensure development not only moves forward, but does so in a fair, balanced way, representing a truly collaborative effort.

Dr. Kaszycki is currently building her Ring of Fire Secretariat team to support Ontario’s efforts to champion sound development of the area.

We are now in the process of hiring an Aboriginal Community and Stakeholder Relations Director to oversee the day-to-day activities of the Secretariat’s lead office, which will be located here in Thunder Bay – on the third floor of the government building at 435 St. James Street.

The director will provide leadership identifying Aboriginal partnership opportunities and delivering on consultation initiatives associated with the Ring of Fire.

We expect to complete the recruitment process and have a director in place in our Thunder Bay office by late February or early March.

I am also pleased to announce that we are in the process of setting up a Ring of Fire Advisory Council.

The role of the council will be to provide high-level advice and recommendations on a range of issues and opportunities as we move forward over the next few years.

While membership has not yet been finalized, I have put forward recommendations and we hope to make an announcement soon.

The Ring of Fire means tremendous opportunity for Ontario. Over the next five years or so, it could bring significant permanent employment opportunities that will last for generations to come.

Development in the Ring of Fire will undoubtedly help build the North’s economy and Ontario’s economy as a whole.

We intend to maximize the benefits of the Ring of Fire for all Ontarians.

I’ll conclude my remarks by reiterating that, in today’s highly competitive global market, a modernized Mining Act will undoubtedly help attract investment and economic opportunities to Ontario.

And, in terms of the Ring of Fire’s incredible potential, we’ve barely scratched the surface.

I look forward to playing a critical co-ordination and facilitation role as this exciting development unfolds.

Thank you once again for the kind invitation to join you today. On behalf of my local colleague MPP Bill Mauro, and all Ministry staff here in Thunder Bay, I hope 2011 keeps you healthy, happy and successful.