TORONTO – The planned growth and 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 shouldn’t have exclusive use of a transportation corridor.
The decision opens the door to construction of a north-south route 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 connect 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 towards the CN rail line in Exton, Ont. Effectively, this gave KWG control over an important 340-kilometre access path to the mineral belt.
U.S. mining company Cliffs Natural Resources Inc. was keen to build up a road as much as the Ring that would 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 develop a road, saying it could negatively affect the claims.
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However, a divisional court overturned that decision this past year. As well as on Wednesday, a legal court of Appeal for Ontario upheld the divisional court’s ruling. That paves the way for a road.
“What the appeals court says is that you can’t hold mineral development hostage, in a sense, 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 that it should have a veto within the claims because 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 in order to access the Ring of Fire, rather than look for minerals in it.
“There wasn’t any evidence that the proposed easement would hinder (KWG’s) exploration or mining of their claims,” Justice G.R. Strathy wrote.
The court decision would be a positive development for Toronto-based Noront, which bought Cliffs’ Ring of fireside assets last year to become the dominant landholder in the area.
Noront is within no rush to develop a north-south road since the clients are currently focusing on an east-west route to access its Eagle’s Nest nickel-copper deposit in the Ring. But once Noront or any other mining companies get serious about developing the big chromite deposits in the area, the north-south route is going to be crucial.
Coutts noted the Ontario government may go ahead and create a north-south road now if it wants. Queen’s Park has committed to spending $1 billion on Ring of fireside infrastructure, and has asked the us 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
