NDP wants northern Ontario mine to bolster steel industry

Changes to Mining Act required to turn Ring of Fire chromite into Ontario stainless steel

By Jody Porter, CBC News

Posted: Feb 25, 2013 7:01 AM ET

Last Updated: Feb 25, 2013 10:22 AM ET

 

The provincial NDP wants to see a vast mineral deposit in northern Ontario used to benefit the province's steel industry rather than offshore interests.

The so-called Ring of Fire mining area in the James Bay Lowlands is believed to contain about a quarter of the world's chromite, the main ingredient in stainless steel.

American company Cliffs Natural Resources is the biggest player in the Ring of Fire. Its most recent investor update shows nearly half of the raw ore mined in northern Ontario is destined for China, while the rest will be shipped to a proposed smelter in Sudbury.

NDP MPP Gilles Bisson said Ontario should develop its own stainess steel industry, instead of sending the raw ingredients overseas.

"Rather than having jobs at the mine and maybe 300 jobs at a ferrochrome facility [in Sudbury], we could end up having tens of thousands of jobs in the stainless steel industry," Bisson said.

'You can't just feed chromite into Stelco or Dofasco'

The Timmins-James Bay MPP admits the plan would take a change in the Mining Act, allowing Ontario to force companies to process minerals within the province.

A steel industry analyst said the federal government would also have to re-think its approach to minerals if Bisson's idea is to fly.

Treasury Board President Tony Clement is the federal government's point person on the Ring of Fire.

"You still need another dancing partner," said Peter Warrian, an author and expert from the Munk School of Global Affairs

The federal government turned its attention to the Ring of Fire last week, appointing Treasury Board president Tony Clement to oversee the project.

"I don't believe this is an opportunity we can afford to let pass us by," Clement said during a speech in Thunder Bay. "The Ring of Fire is no ordinary mine development. It is a unique platform from which to materially improve the quality of life for thousands."

But Warrian isn't optimistic the Conservatives will see eye-to-eye with Ontario's NDP when it comes turning the mining opportunity into a manufacturing opportunity.

"The [Conservatives] nailed their whole policy to the export of largely raw natural resources, such as bitumen," Warrian said.

But even if governments changed their policies, Warrian said turning raw ore into stainless steel in Ontario wouldn't be easy.

"You can't just feed chromite into Stelco or Dofasco," he said.

No road to the Ring of Fire

Warrian said the majority of Canada's stainless steel manufacturers "gradually shut down 20 years ago" as part of the steel industry recession, but he adds that there will be growing demand in North America in the longer term.

Still, he said, the NDP concept of manufacturing all of northern Ontario's chromite in the province would require some heavy investment.

Ontario's Minister of Northern Development and Mines Michael Gravelle says a smelter in Sudbury will provide value-added jobs from the northern ontario mining activity.

"Who would be the project sponsor?" he asked.

Bisson has an answer for that.

There is no road to the Ring of Fire mining area and as yet, no way for the ore to be transported out. Cliffs and other companies working there are looking for government subsidies for a road or rail link, as well as discounted energy costs at the proposed Sudbury smelter.

"We will be prepared to sit down with the mining companies in the Ring of Fire to help develop some of the infrastructure necessary to build the mine," Bisson said. "But in exchange for that we want to make sure those ores are processed in Ontario and that we transform them all the way to stainless steel."

However, Ontario's ruling Liberals aren't as concerned about the chromite bound for China.

Minister of Northern Development and Mines Michael Gravelle said having more than half the ore processed in Ontario, is better than none.

"What we're going to see is a value-added opportunnity in the province of Ontario that was never there before," Gravelle said.

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