Olduvaiblog: Musings on the coming collapse

Home » Canada » The Ring of Fire’s Future Is Now a Burning Question | Sunny Freeman

The Ring of Fire’s Future Is Now a Burning Question | Sunny Freeman

The Ring of Fire’s Future Is Now a Burning Question | Sunny Freeman.

Mining giant Cliffs Natural Resources’ decision to halt work on the largest project in northern Ontario’s Ring of Fire region has aroused a sudden interest in the lumbering development.

The opposition at Queen’s Park pounced to lay blame on the province for the squandered opportunity.

Financial analysts scurried to advise clients on what it means for their shares. And usually blasé news outlets called on pundits to discuss whether the loss of the U.S. mining giant was a death knell for the much-hyped but little-understood development.

The biggest player in the Ring of Fire, a 5,000 square kilometre tract of land in Ontario’s Far North that is said to hold a potential $50 billion in mineral deposits, announced late Wednesday it is halting work on its $3.3 billion chromite project indefinitely, blaming, for the most part, an “uncertain timeline.”

If Cliffs’ decision to stop development is the death of that high stakes mining discovery, it was anything but a sudden one.

This past summer, I was one of just two reporters covering a historic three-day meeting of the Matawa First Nations, a group that represents many of the communities that are affected by Ring of Fire development. As part of my reporting for HuffPost’s Staking Claim series, I’ve spoken to the major players in the First Nations community, in government and from the mining companies involved.

They all saw this coming. And none are panicking that the Ring of Fire has been extinguished.

Any insider could see the signs: the many stalls, delays and conflicts between miners and First Nations; miners and government; and government and First Nations.

Just about the only thing the players have agreed upon is the need to “get it right.” The problem is no one has agreed on what that means.

Cliffs has been telegraphing its frustration with the development process every time I have spoken with execs over the past year. It has warned, with growing severity, that it might be “forced” to pull out of the Black Thor chromite project if it doesn’t see better progress. It said so in June, when it halted its Environmental Assessment over a number of uncertainties, and it said so even louder in September when the province denied it the rightto build a road on land held by a rival miner.

For the debt-strapped company struggling with funding expansion in an era of low metal prices, the choice to stop work in the Ring of Fire was simple math. Patricia Perisco of Cliffs explained that projects compete internally for funding and Black Thor was a tough sell.

The U.S. mining giant has called the region unprecedented both in the opportunity to open a new mining region and in the scale of the challenges the company faced.

When Ontario announced earlier this month its idea for a loosely formed development corporation to bring the players together, it was too late. Cliffs didn’t even hold an initial meeting on the topic — it wanted out. And yet, it hasn’t ruled out getting back in, either. The company will continue to talk with First Nations and government (whom it will no doubt lobby for its preferred transportation route).

Cliffs may be ready to re-enter the region by the time Matawa and Ontario finally reach agreement on a number of preliminary issues, which could still be years away.

For its part, the Ontario government, which stands to gain billions in royalties from the potential development, moved swiftly to assure would-be investors the province is still open for business and that the potential in the Ring of Fire is alive.

But it has been anything but swift when it comes to action. More than a decade after discovering riches in the frozen muskeg of the north, no one has been able to penetrate either the earth or ill-defined regulatory walls.

Opposition parties that have for years blamed the government for mismanaging and underestimating the importance of the project used Cliffs’ announcement as an “I told you so” moment.

The government’s nonchalant attitude about the potential loss of the biggest player in the region belies the fact that the piece of the royalty pie it has to divvy up with First Nations just shrunk substantially. There may still be some 20 other miners in the region, but Cliffs’ decision is like Wal-Mart pulling out of a major retail development: it doesn’t mean the project won’t go ahead but it puts the onus on a number of independent boutiques whose pocketbooks are considerably smaller.

As for the people who will be most directly affected by the project, the First Nations communities surrounding the area, they are neither surprised nor fazed by Cliffs’ decision.In fact, they welcome it. They’ve been on this land since time immemorial, have been the victims of development for centuries, and are in no rush for a snap decision or quick resolution.

The people of the Matawa First Nations are ambivalent about the Ring of Fire. They have deep concerns about the impact a new mining region will have on their pristine land, on the animals and fish on which they rely and on their way of life which involves a deep connection to the land.

In Webequie, the fly-in reserve some 500 kilometres north of Thunder Bay that is closest to the Ring of Fire, animals are already fleeing from exploration activities to its east.

There is a tempered enthusiasm toward the jobs, roads and prosperity they’ve been promised, but they’re also jaded following years of broken promises. One young man in Webequie beginning a heavy equipment training program with the possibility of a Ring of Fire job had already trained as a firefighter, land staker and diamond driller with the promise of a steady income. He is still unemployed, like 70 per cent of the reserve.

Matawa’s CEO David Paul Achneepineskum said this week the setback will give First Nations more time to assess the environmental impacts of the development as well as prepare their people for the opportunities it may present.

The tribal council’s chief negotiator Bob Rae made it clear in a tweet that he’s hellbent on pursuing a fair deal “to end (a) cycle of poverty for First Nations,” even with the biggest player gone.

Still, with pressure from Cliffs removed as an impetus to reach a deal quickly, negotiations with the province risk losing focus and dragging on longer.

While no one denies that Cliffs’ move is a game changer, the looming question is whether it’s a game ender.

The First Nations, government and industry players I spoke with answer with a resounding “no.” But industry-watcher and Native legal rights expert Bill Gallagher says their stances are either spin or delusion. The Ring of Fire, he says, is in the “project death zone” and “the biggest missed opportunity on Ontario’s road to resources in a generation.”

Fault will inevitably be assigned: was it that First Nations were “anti-development”? Was the province too slow or too unorganized to act? Or did the miner misjudge how quickly they could put a shovel in the ground?

Any attempt to analyze what went wrong, and whether it can be put right, must go far beyond those surface level questions.

It is a wake-up call that should be answered not with dwelling on what went awry, but instead determining, once and for all, what it actually means to “get it right” in the Ring of Fire.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Enter your email address to follow this blog and receive notifications of new posts by email.

Join 313 other followers

  • 69,560

Top Clicks

  • None