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Wednesday, March 31, 2010

Ontario Lowlands set for mineral boom

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The provincial government of Ontario has announced plans to develop the James Bay Lowlands in the north of the province, Minerals and Metals magazine reports. More than 20 mining companies are hoping to cash in on an area believed to contain high-grade deposits of nickel, copper, zinc, gold, chromite and palladium.

The government plans to build a railway, roads and processing facilities in an area known locally as the Ring of Fire.

James Bay Lowlands is an extremely wet area on the edge of Canada's boreal forest, some 300-400km (186-248 miles) from any existing permanent infrastructure; however investors are concentrating on a 12-km (7.44-mile) area with the Lowlands region. Currently, access to the general area is by floatplane and helicopter.

Significant preparatory work such as environmental assessments and feasibility studies will be needed before the real work can begin. Whatever infrastructure is built will depend on the nature of the mineral projects. However it is thought that winter roads on ice and snow would probably suffice for most projects, which can be adapted to seasonal production. However, there are plans for a 320-km rail (199-mile) line that will link Nakina, north of Lake Superior, to chromite mines in the Ring Of Fire. This is because, unlike some other mineral projects in the area, chromite mining is expected to be a year-round activity.

Canada Chrome has staked mining claims along one possible route in order to secure a right-of-way. "We're in the early process of evaluating the project," says Nels Ojard, the firm's group manager for special projects. Ojard added that the project is probably five to seven years from becoming a reality.

Frank Smeenk, president of Canada Chrome's parent company, KWG Resources, said it is too early to tell whether processing facilities such as smelters and concentrators will be built at the Ring of Fire or elsewhere. This depends largely on the consistency of an electricity supply.