Canada’s Ontario to invest up to $1bn in Ring of Fire
The government of Ontario said Monday it is ready to allocate up to Cdn$1 billion to develop an all-season transportation corridor to the Ring of Fire and it is asking the Federal government to match the funds.
The funds would help build the necessary infrastructure to develop the mineral-rich deposit, which authorities say will create jobs and boost northern Ontario's hard-hit economy.
The 4,000 sq kilometres Ring of Fire, located 540 km northeast of Thunder Bay, is home to rich mineral deposits, and lawmakers say it could bring prosperity to northern Ontario much like the oil sands industry have to northern Alberta. But the region lacks highways, rail lines or reliable power.
US-based Cliffs Natural Resources (NYSE:CLF) had to suspend most work on its $3.3 billion Black Thor last summer, citing stalled talks with the province and other political and regulatory problems. The miner added it had struggled to win over aboriginal communities in the region.
Noront Resources Ltd. (TSXV:NOT), which holds the Eagle's Nest and Blackbird mining projects, said the province's commitment is a "vital milestone" that will benefit remote First Nations communities.
"Mining and the associated job creation can't happen without infrastructure, so we are pleased to see the province make a clear public commitment to funding a transportation corridor in the Ring of Fire," Noront president and CEO Alan Coutts said in a release.
Noront's TSX Venture-listed shares went up by 9.1% to cents on Monday. Cliffs was down 3.7% at $17.33 on the New York Stock Exchange.
The Ring of Fire has mineral potential known to be worth $60 billion and includes the largest deposit of chromite, a key steel-making ingredient, ever discovered in North America.
The region also holds the potential for significant production of nickel, copper, gold and platinum.