Cliffs sells Ontario’s Ring of Fire claims to Noront for $20 million
U.S. miner Cliffs Natural Resources (NYSE:CLF) has struck a deal to sell its chromite assets in Canada’s Ring of Fire mineral region, about 500 kilometres north-east of Thunder Bay, to Noront Resources (TSX-V:NOT) for $20 million.
To finance the transaction, Toronto-based Noront said it is borrowing $22.5-million from Franco Nevada Corp. In return, Franco Nevada will receive royalties on several chromite deposits.
Noront’s president and chief executive officer Alan Coutts said the deal underscores the company’s “long-standing belief and commitment” to the region.
“We have made significant investments in the Ring of Fire and our team has become experts in the region from both a technical and social point of view,” he said in a statement.
The Ring of Fire was once touted as Canada’s next oil sands, but interest in the area has fallen off and the prospects for development in the remote region, located on First Nations land, have faded.
In the past two years Cliffs has been moving away from its Canadian assets. In 2013 it revealed it had suspended plans for a major investment to develop its untapped chromite claim in Ontario. The announcement was followed last November by its decision to completely withdraw from eastern Canada, including its Bloom Lake iron mining operations along the Quebec-Labrador border.