After two years of turmoil, only one company’s left standing in Ontario’s Ring of Fire

The Ring of Fire is Ontario’s biggest mineral discovery in a century. Strong competition among mining companies for a piece of it would seem inevitable.

Today, however, only one junior mining firm controls almost all of it.

“Essentially, we are the Ring of Fire,” Noront CEO Al Coutts says. “Essentially, in every major discovery in the Ring of Fire we have either 100 per cent or majority control.”

Coutts is exaggerating, but not by much. While a number of other companies looking to exploit the riches of the Ring of Fire, such as KWG, MacDonald, and Black Widow, Noront has rapidly become the largest company in the area, and remains the closest to actually opening an operating mine.

It wasn’t supposed to be like this. The Ring of Fire, located about 500 kilometres northeast of Thunder Bay, has substantial economic potential, with estimates of $50 billion worth of chromite, platinum, palladium, copper, and nickel to be extracted.

The promise of chromite, in particular, drew Cliffs Natural Resources, one of America’s larger iron mining companies. (Chromite, like iron, is a necessary ingredient for stainless steel.) Cliffs’ entry was supposed to herald enormous new investments in Ontario, including a nearly-$2 billion smelter in Sudbury.

Instead, in November 2013, Cliffs abandoned its plans entirely.

Despite the promise of riches, the Ring of Fire has numerous challenges, both logistical and political.

The minerals sit hundreds of kilometres from the nearest all-season roads in the James Bay Lowlands, making it difficult to get equipment to the mines – and impossible to get substantial amounts of ore to market.

Connecting the Ring of Fire to the rest of the world has also been delayed by corporate politics. Before Cliffs left, it was engaged in a years-long disagreement with rival mining firm KWG over whether a transportation corridor should be a road or railroad.

Add to that prolonged negotiations with First Nations (a step Coutts, other miners, and the government all agree is necessary) and a global slump in mineral prices. It all makes the very public battle Ontario waged last year to get more federal money to support the project seem like one of the smaller obstacles in the way.

Coutts, however, remains optimistic. In the last six months, many of the obstacles have disappeared or shrunk: Queen’s Park pledged $1 billion for infrastructure, former Premier Bob Rae and retired Justice Frank Iacobucci are negotiating on behalf of the government and First Nations, and the dispute between KWG and Cliffs is now irrelevant. Coutts says Noront’s Eagle’s Nest nickel mine could be ready to go in as little as three years.

“It’s viable, very viable, almost regardless of the market conditions. Even at today’s (low) prices, this is a very robust project and would make money,” Coutts says.

Minister of Northern Development and Mines Michael Gravelle says the province is looking forward to seeing more action, in particular from Noront. The next major milestone will be starting the approval process of Noront’s proposed road link to Eagle’s Nest, a location within the Ring of Fire rich in nickel, copper and platinum.

Using trucks, though, to transport the chromite deposits elsewhere in the area is too expensive. Much of economic potential for the Ring of Fire is pinned to future chromite mining—a railway link will eventually be necessary.

But as long as chromite prices stay low, the rail link is likely on the back-burner. Indeed, some argue the current prices have doomed the Ring of Fire for a generation. Cliffs CEO Lourenco Goncalves told the media in November 2014 there won’t be significant development for 50 years.

Noront has also had troubles of its own. The company’s chief operating officer Paul Semple passed away suddenly in April. Semple, according to Coutts, was the “driving force” behind much of the company’s work and a familiar face to communities in the north. Local First Nations have also protested Noront’s bid for Cliffs assets, arguing they were cut out of the process. Noront’s purchase was approved by a Quebec court over the objections of the Matawa Tribal Council.

Chief Wayne Moonias of Neskantaga First Nation says he and other Matawa chiefs opposed Noront’s purchase of Cliffs assets because Noront hasn’t consulted them in its mining activities.

“If they want to explore within our traditional lands, they need to respect our positions and how we want to be engaged. Noront hasn’t done that,” says Moonias. “If they’re going to develop these projects, it has to be done differently from how they’re doing it today.”

Coutts hopes opening the Eagle’s Nest mine early can get all parties in the northwest – business, government and First Nations – used to the idea of mining the Ring of Fire, so that further developments won’t make people quite as anxious.

“Eagle’s Nest is quite modest in its infrastructure needs. When it’s operating, and everyone’s feeling good about mining in the Ring of Fire, let’s turn our head to some of the more challenging, long-term projects."