Ontario court ruling opens up potential road access to ‘Ring of Fire’ mineral belt

TORONTO – The planned development of Northern Ontario’s “Ring of Fire” mineral belt got a potential boost on Wednesday when an appeals court ruled that the small junior mining firm should not have exclusive access to a transportation corridor.

The decision opens the door to construction of the north-south road to the Ring, which is thought to contain about $60 billion of chromite and other minerals. The Ontario government supports a road, partly since it would link up with remote First Nations communities.

In 2009, a Toronto-based company called KWG Resources Inc. staked more than 200 mining claims going from the Ring of fireside all the way down to the CN rail line in Exton, Ont. Effectively, this gave KWG treatments for an important 340-kilometre access path to the mineral belt.

U.S. mining company Cliffs Natural Resources Inc. was keen to develop a road as much as the Ring that will cross a lot more than 100 of KWG’s claims. Nevertheless its tries to achieve this were thwarted.

In 2013, the Ontario Mining and Lands Commissioner rejected Cliffs’ request an “easement” on KWG’s states build a road, saying it might negatively modify the claims.

Related

Top ‘Ring of Fire’ miner threatens to prevent project unless Ontario, First Nations make progress’Ring of Fire’ asset sale descends into chaos

However, a divisional court overturned that decision last year. And on Wednesday, the Court of Appeal for Ontario upheld the divisional court’s ruling. That opens the door for a road.

“What the appeals court is saying is that you can’t hold mineral development hostage, in this way, by staking in the access routes and holding them,” said Alan Coutts, leader of Noront Resources Ltd., which owns vast chromite assets within the Ring of fireside.

The appeals court said hello didn’t accept KWG’s argument it should have a veto over the claims since it might eventually discover minerals on them and a road could interfere with exploration and development. It was no secret that KWG staked these claims to be able to connect to the Ring of fireside, rather than look for minerals on them.

“There was no evidence the proposed easement would hinder (KWG’s) exploration or mining of its claims,” Justice G.R. Strathy wrote.

The court decision was a positive development for Toronto-based Noront, which bought Cliffs’ Ring of Fire assets last year to become the dominant landholder in the area.

Noront is within no rush to build up a north-south road because the company is currently focusing on an east-west route to access its Eagle’s Nest nickel-copper deposit within the Ring. But when Noront or any other mining companies get seriously interested in developing the big chromite deposits in the area, the north-south route is going to be crucial.

Coutts noted that the Ontario government could go ahead and create a north-south road now if it wants. Queen’s Park has committed to spending $1 billion on Ring of Fire infrastructure, and it has asked the federal government to complete exactly the same.

“This does open up possibilities for the provincial government’s infrastructure plans,” he explained.

pkoven@nationalpost.com

Twitter.com/peterkoven