Competition stays hot for smelter: Noront Resources boss offers insight into ferrochrome facility selection process.

• Author: Ross, Ian
• Position: Mining

Alan Coutts is dragging out the suspense to find a Northern Ontario home for a Ring of Fire ferrochrome production plant for just a few more months.

The president-CEO of Noront Resources wants to keep the competitive process going to get the best deal possible to place the Toronto mine developer's $1-billion smelter project in either Sault Ste. Marie or Timmins.

Instead of announcing a landing spot for its plant this summer, the company decided to drop Sudbury and Thunder Bay from its four-city bidding process, and is punting its final decision toward the end of this year.

Land negotiations are getting underway with the selected property owners in the two remaining cities.

Coutts said what became clear during their internal site-selection evaluation process was the requirement to find a property that best fits their needs, but also get discussions going on reaching a deal.

"Even if we saw the cost advantages with a site, if we couldn't achieve a commercial arrangement with the owner, it negated part of the reason to pick that site."

The Sault is touting the industrial lands owned by Essar Steel Algoma, west of the steel plant and just north of what's known as the export dock, run by the Port of Algoma.

Timmins offers the Metallurgical Site (Met Site), owned and still operated by Glencore as a concentrator. That site is slated for closure in 2022 when production halts at the Kidd Creek Mine.

In selecting two finalists, Coutts wants to "keep the tension in the process so that these owners would be motivated to give us a good deal to use the property."

In the Sault, Noront is waiting for Essar Steel Algoma to clear CCAA protection which, Coutts has been told by city officials, should take a couple of more months.

The restructuring process has approval of both unions at Essar, but a complicated debt settlement must be worked out between the steelmaker, the port operator and its financier.

"We're hearing there are no real issues there, but it takes time," said Coutts.

At the Met Site, Glencore has certain remediation obligations depending on whether or not the property will be used for industrial purposes.

"They have some closure obligations they may start or defer depending on whether or not we take over the site," said Coutts.

The Met Site was the last smelter permitted in Ontario. Redeveloping it requires a full and lengthy environmental assessment because situating a new smelter can't be grandfathered in under the old permitting regime.

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