KWG Resources Inc.

Federal Treasury Board president Tony Clement told a business audience in Timmins Monday not to expect either the federal or provincial government to make any significant moves on the Ring Of Fire project until the market improves for the mining industry overall. Timmins Times LOCAL NEWS photo by Len Gillis.

By LEN GILLIS

The Timmins Times

The federal and provincial governments are not likely to make any significant moves on the Ring Of Fire mining project until there is a vast improvement in mineral markets.

That was the word Monday from federal Treasury Board president Tony Clement, who was the guest speaker at a Timmins Chamber of Commerce luncheon.

Clement was responding to a question about the "report card" on the Ring Of Fire put out last week by the Ontario Chamber of Commerce which gave failing grades to both the federal and provincial governments for not being pro-active enough to get mining projects up and running.

The Chamber report card blamed red tape in the mine permitting process as well as a failure to provide infrastructure, such as better road or rail links.

"There has been little progress developing this extraordinary economic opportunity. There is still no infrastructure plan in place, there remains little agreement between the most important players, and delays in issuing exploration permits have stalled any potential development. In short, we are still years away from opening a mine in the Ring of Fire. Further, development timelines are increasingly characterized by uncertainty," said the Ontario Chamber report.

The Ring Of Fire project is a mining development located about 600 kilometres northwest of Timmins, in the remote McFaulds Lake area. The prospect is identified mainly as a chromite project, valued in the tens of billions of dollars. There are huge deposits of other metals there too, but so far none of the three significant mining companies involved has moved forward with any sort of a mining operation.

Noront Resources, KWG Resources Inc. (both Canadian) and Cliff's Natural Resources Inc.(American) are the major players in the region. Cliff's is in the process of trying to sell off its prospect, while Noront (the Eagle's Nest project) and KWG (the Big Daddy project) continue to plan for the day when they can begin development work.

Speaking to the business lunch in Timmins, Clement said it is not realistic to expect government to step in and boost the Ring Of Fire at this time.

"There's two things that have to happen before the Ring Of Fire can take off," Clement told the Chamber members. "The first thing you need is economic conditions so that private-sector mining companies can feel confident that when they start to invest in the Ring Of Fire there will be a return on their investment," he said.

Clement said Canada's mining sector has not been promising in recent years, not because anything was done wrong in Canada, but because of world economic conditions.

'SOMEBODY HAS TO GO ALL IN'

"When people say you've not done enough for the Ring Of Fire you know we need a willing partner in the private sector ready to go all in. And that will happen. That will happen. You know the cycle has to turn a little bit," he said.

The second thing we need, and this is more out of our control as the federal level, is you need the organization that controls the natural resource to have a working relationship with First Nations communities, so that they can have an understanding of economic success that works for both. Of course when I mention the organization that controls the natural resource, I am talking about the province," said Clement.

In the meantime, Clement said the feds have been active in "building up capacity" on First Nations reserves, with things like vocational education, training and governance "So they can deal with the complex issues associated with the Ring Of Fire. So I think that is an investment well work making as a lead up to when the economic factors are in alignment for future activity," he said.

Clement said too many other factors have to come into play before the project can move into a higher gear.

"The horse before the cart would be the province and federal government ready to proceed when the market conditions do not exist and when the agreements with the First Nations do not exist. That would not be a wise approach," said Clement.

Clement was also speaking about the Harper Government's economic history in the past four years, in what was clearly a pre-election stump speech aimed at voters for October 19th, 2015, which is when the next federal election is planned.

Clement said the federal government has provided numerous tax cuts and tax credits in recent years, that he claimed were all contributing to giving Canada the sort of stable economy that other nations are envious of.

"Canada's economy has seen one of the best economic performances among all of the G7 highly industrialized countries in recent years," said Clement.

"I can tell you we will continue to fulfil our commitment to a balanced budget. Obviously this has been one of the reason's why we believe our economy is seen as one that if working well," he said.

"I can tell you other world leaders look at Canada and say 'How can we be more like Canada? That's the message we keep getting over and over again when we participate in international economic conferences," said Clement.

len.gillis@sunmedia.ca