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https://www.northernminer.com/news/ontario-to-work-with-first-nations-to-unlock-ring-of-fire/1003809733/

Ontario to work with First Nations to unlock Ring of Fire

Posted By: Jean Lian September 10, 2019

Ontario is one step closer to making the Ring of Fire a reality.

Rick Gregford, the Minister of Energy, Northern Development and Mines and Minister of Indigenous Affairs, announced last month that the province will work directly with First Nations communities to develop infrastructure that will unlock the mineral-rich region in northern Ontario.

Establishing bilateral agreements directly with individual First Nations communities to replace the previous Liberal government’s collective-negotiations approach under a 2014 framework agreement with nine Matawa First Nations communities, will expedite the building of a north-south corridor to the Ring of Fire.

Noront Resources (TSXV: NOT), which says it holds 85% of all claims staked in the Ring of Fire, and Marten Falls First Nation, released a statement in late August applauding the provincial government’s move.

“We are encouraged by the Ontario government’s support and commitment to develop, on an expedited basis, the Ring of Fire mineral deposits and associated infrastructure, which will be shared between community and industry use,” the joint statement said.

Marten Falls First Nation is leading an environmental assessment for an all-season access road along the north-south corridor that will connect the community to Ontario’s provincial highway network in the south.

The all-season access road project consists of two phases: the first phase is an all-season community access road in between 140 and 250 km that will connect Marten Falls First Nation to forestry access roads near Painter Lake, located north of the small town of Nakina, Ontario. The second phase is an all-season supply road that will branch off the community access road north of the Albany River and connect to the Ring of Fire.

“Ontario recognizes the importance of the connection to the Ring of Fire and will work with Noront and partner communities to pursue this work,” the Ministry of Energy, Northern Development and Mines said in an email interview.

The provincial government’s announcement is big news for Noront. The Eagle’s Nest project, which hosts a high-grade nickel-copper-platinum deposit, is Noront’s flagship project in the 5,120-sq-km Ring of Fire. The project needs an all-season road to get the mineral concentrate to market.

“We need to have certainty around the road and the road construction going ahead,” Alan Coutts, Noront’s president and CEO, says in an interview. “Without the road, that project is not viable.”

Marten Falls First Nation is located between the Ring of Fire and 170 km northeast of Nakina. There is only one airline connecting the First-Nations community to Nakina, and climate change has made winter roads more hazardous each year.

Chief Bruce Achneepineskum of Marten Falls First Nation in Ogoki, says the north-south corridor will enable remote First-Nations communities in the region to benefit from the Ring of Fire’s development.

Noront signed a project-advancement agreement with Marten Falls First Nation in April 2017. The agreement enables Noront to consult and involve traditional land holders like Marten Falls First Nation on developing mining projects that fall on ancestral land in the region.

Under the agreement, Noront issued 300,000 shares to Marten Falls First Nation in early September. Another affected community, Aroland First Nation, 20 km west of Nakina, also received 150,000 Noront shares as part of a memorandum of understanding it signed with the company in June 2019.

The Ring of Fire is made up of a belt of mafic and ultramafic rocks wrapped around a circular intrusion of granodiorite. Coutts describes the Ring of Fire as a 2.7 billion-year-old Greenstone Belt. According to the Ontario Chamber of Commerce’s 2014 report, Beneath The Surface: Uncovering the Economic Potential of Ontario’s Ring of Fire, the emerging mining district will generate up to $9.4 billion in gross domestic product, up to $6.2 billion for Ontario’s mining industry, and create up to 5,500 full-time jobs annually, including nearly $2 billion in government revenue within the first 10 years of its development.

“It will be a mining district where you will have multiple mines built and developed over the next 100 years. That why it is so important,” Coutts says. “There has already been over 20 mineral discoveries made in the region.”

Chief Achneepineskum says Marten Falls First Nation has already felt some of the effects stemming from interest in the Ring of Fire. “It already has [had] a lot of impact, with the exploration [and] choppers flying by,” he says.

For Coutts, the Eagle’s Nest project comes at an exciting time when the global demand for nickel is growing due to its use in batteries used in the emerging electric car industry.

According to Natural Resources Canada, global mine production of nickel in 2017 was estimated at 2.1 million tonnes. Canada ranked fifth, accounting for 10% of all production. Stainless steel is the largest end use for nickel, accounting for two-thirds of total consumption. Nickel is also used as an alloying agent in the manufacture of both ferrous and non-ferrous metal products and in batteries.

The burgeoning need for electric-vehicle batteries could increase the demand for nickel by as much as 500,000 more tonnes per annum in the next 10 years, Coutts says. “So the demand is very, very high, and our project is perfect timing.”

With an anticipated mine life of 11 years, the Eagle’s Nest project is expected to produce 3,000 tonnes of ore per day and deliver 150,000 to 250,000 tonnes of nickel-bearing concentrate each year.

Noront has had discussions with nickel smelters in Sudbury that Coutts says are keen to get feed from the project. In addition to nickel, the project will also produce by-products copper, platinum and palladium. Say Coutts: “Currently, palladium prices are very strong, and copper, of course, has a number of uses.”

The nickel project has an inferred resource of 8.9 million tonnes grading 1.1% nickel, 1.14% copper, 1.14 grams platinum per tonne and 3.49 grams palladium for 34.2 million lbs. of nickel, 19.2 million lbs. of copper, 23,470 oz. of platinum and 90,022 oz. of palladium per year.

Over the next 12 months, Noront will update a 2012 feasibility study on Eagle’s Nest. It also plans to do metallurgical work and conduct studies around a separate nickel and copper concentrate instead of a bulk concentrate envisioned in the 2012 feasibility study. “We would also like to establish a cobalt resource for the deposit. We have cobalt, but we don’t currently have resources established.”

Notwithstanding the Ring of Fire’s economic potential, the report by Ontario Chamber of Commerce highlighted several challenges that need to be addressed. The lack of adequate transportation infrastructure, labour shortages in northern Ontario and the province’s energy costs, which deter some companies from processing minerals within the province, are significant barriers to the Ring of Fire’s development.

Coutts says Noront envisions running the Eagle’s Nest project on diesel generators. “We prefer to have grid power, or some other sorts of power at the site that is more sustainable and cheaper.”

There are also concerns over environmental repercussions associated with mining developments. Chief Achneepineskum says any mine that starts up will affect the land. As a result, he stresses the importance of keeping nearby communities informed of how mining developments will affect them.

According to Coutts, local First Nations communities have raised their concerns about water quality, the effect that open pits and waste-rock piles would have on the surrounding environment, and legacy issues such as tailings dam and clean up after the mine has been exhausted.

As a result of those concerns raised during discussions with local communities and stakeholders, Noront has designed the Eagle’s Nest project as an underground mine, and tailings will remain underground.

“There will be no open pit, no associate waste-rock piles,” he says. Process plant water will be recycled to minimize the discharge of effluents. “A lot of these minimize the footprint, and that means you don’t have as many legacy issues.”

Coutts expects it will take two years to complete permitting activities and the public-review process, while construction of the mine will take roughly three years. “So let’s say in five years’ time, you would have mineral concentrate from Eagle’s Nest going down an all-season road to market.”

In addition to Eagle’s Nest, Noront has three advanced chrome projects in the Ring of Fire: Blackbird; Black Thor and Big Daddy. “We have got resources that are sufficient for over a hundred years of mineral production,” says Coutts.

Noront’s 100%-owned Blackbird deposit, discovered in 2008 and located less than one kilometre from Eagle’s Nest, will be the company’s second project. A 2012 resource estimate outlined measured and indicated resources of 20.5 million tonnes grading 35.8% chromium oxide (Cr₂O₃), and inferred resources OF 23.5 million tonnes grading 33.1% Cr₂O₃. The resource used a chrome-to-iron ratio of 1:1.97 and a cut-off grade of 20% Cr₂O₃.

The 100%-owned Black Thor chromite deposit — Noront’s third project — is 8 km northeast of Eagle’s Nest. Black Thor is the largest chromite discovery in the Ring of Fire. It has a measured and indicated resource of 137.7 million tonnes grading 31.5% Cr₂O₃ and an inferred resource of 26.8 million tonnes grading 29.3% Cr₂O₃.

Black Label, a parallel chromite deposit that lies 150 metres northwest of Black Thor, has a measured and indicated resource of 5.4 million tonnes grading 25.3% Cr₂O₃. Inferred resources stand at 900,000 tonnes grading 22.8% Cr₂O₃ with a cut-off grade of 20% Cr₂O₃.

The Big Daddy deposit, 5 km northeast of Eagle’s Nest, has a measured and indicated resource of 29.1 million tonnes grading 31.7% Cr₂O₃ and an inferred resource of 3.4 million tonnes grading 28.1% Cr₂O₃, based on a cut-off grade of 20% Cr₂O₃. Noront holds a 70% interest in Big Daddy and Canada Chrome Mining Corp., owned by KWG Resources (CSE: KWG), owns the remaining 30%.

Coutts says Noront will need a ferrochrome production facility to process the chromite mined from its deposits. In May 2019, Noront chose Algoma Steel in Sault Ste. Marie as its ferrochrome production facility through a bidding process that saw submissions from four communities: Sudbury, Thunder Bay, Sault Ste. Marie and Timmins.

Factors that were considered in the bidding process included environmental and site suitability, capital costs, operating costs and community acceptance for hosting the facility. Sault Ste. Marie was chosen for its lower operating costs per pound of chrome in ferrochrome and its location on the Great Lakes, which offers a lower, long-term operating cost advantage, according to the company, Coutts said.

“We really like that location because it gives us great access to North American markets, but also international markets,” he explained.

For now, all eyes rest on the development of a north-south road.

“The north-south road will not only provide access to the Ring of Fire and those mineral deposits, but it will also provide access to the local community,” says Coutts. “There is an industrial need, and there is also a social need, that is addressed by this development.”

Chief Achneepineskum says he is hopeful that the Ring of Fire will create investments in infrastructure, employment, training and social support. It will also inject revenue streams into First Nations communities. “I believe it can do that,” he says of the Ring of Fire.