Thursday, November 21, 2013 9:35:19 AM
By Liezel Hill - Nov 21, 2013 7:58 AM ET
Cliffs Natural Resources Inc. (CLF), the biggest U.S. iron-ore producer, said it will suspend its $3.3 billion chromite project in Canada by the end of the year, citing the risks of developing infrastructure in the remote area.
All technical project work, including a feasibility study and exploration, is being halted and there is no restart date planned, Cleveland-based Cliffs said in a statement late yesterday. Offices in Thunder Bay, Ontario, and Toronto will close, it said. The company already suspended environmental-impact assessment activities for the project, located in the mineral-rich Ring of Fire region of northern Ontario.
Cliffs’s project was among the most advanced in the Ring of Fire, an area about 1,200 kilometers (740 miles) north of Chicago, which holds deposits of nickel and copper that may be worth between C$30 billion ($29 billion) and C$50 billion, the Canadian government said in March. The company’s plans received a setback when the Mining and Lands Commission of Ontario ruled against Cliffs’ proposal for an all-weather road to transport ore that would cross claims of another company in the area.
Cliffs “will not allocate additional capital for the project given the uncertain timeline and risks associated with the development of necessary infrastructure to bring this project online,” the company said in the statement. “Cliffs will continue its work with the Government of Ontario, First Nation communities and other interested parties to explore potential solutions related to the critical issue of infrastructure for the Ring of Fire region.”
Chromite is processed into ferrochrome, an ingredient used to produce stainless steel. Cliffs estimated the project’s total cost at $3.3 billion, including mine development, a processing facility and transportation infrastructure, the company said in January 2012.
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