THUNDER BAY – The Ring of Fire is waiting again. Cliffs Natural Resources Inc. (NYSE: CLF) (Paris: CLF) announced today that its affiliate, Cliffs Chromite Ontario Inc., is temporarily suspending the environmental assessment activities for its Chromite Project in Ontario, Canada.
Over the course of the past year, Cliffs stock has fallen in value. From a year’s high of over $50 the stock is now year the year low of about $16.
The Company indicated that its decision to temporarily suspend these activities is due to delays related to the environment assessment process, land surface rights, and negotiations with the Province of Ontario.
The drop in stock price is not being slated as a reason for Cliffs decision.
“While most aspects of the Chromite Project have advanced according to plan, temporarily suspending the environmental assessment work acknowledges that certain critical elements of the project’s future are not solely within our control and require the active support and participation by other interested parties such as government agencies and impacted First Nation communities,” said Bill Boor, senior vice president – global ferroalloys for Cliffs. “We remain excited about this project and its potential for Cliffs and Northern Ontario; however, given the current unresolved issues, we cannot and will not unilaterally move the process forward and must manage our resources appropriately.”
The Company cited that the following open issues are impeding the progress of the project’s environmental assessment process, as well as the Feasibility Study evaluation:
- Delayed approval of the Terms of Reference for the provincial Environmental Assessment (EA) process.
- Uncertainty regarding the federal EA process due to the current judicial challenge by a number of the impacted First Nations.
- Unresolved land surface rights issues following a February 2013 Mining and Land Commissioner hearing.
- Unfinished agreements with the Government of Ontario that are critical to the project’s economic viability.
“In a practical sense, we’ve taken the EA and other project work as far as possible without resolution of these issues,” said Mr. Boor. “Although we are temporarily suspending our EA activities, we will continue our work with the Government of Ontario and First Nation communities and look forward to restarting the work on the EA when we are collectively ready to make this project a reality.”
As previously disclosed, Cliffs indicated that before it can advance the project, the Company must receive provincial and federal environmental assessment approvals, negotiate mutually acceptable agreements with impacted First Nation communities, work with governments to address the lack of infrastructure in the Ring of Fire and complete its commercial and technical feasibility studies.