Ring of Fire junior wins strategic victory: mining giant Cliffs denied road access to Ring of Fire.

• Author: Ross, Ian
• Position: MINING

Frank Smeenk didn't want to use the opportunity to gloat. "It's important not to do that publicly" chuckled the CEO of KWG Resources.

The Toronto junior miner's bitter rival in the Ring of Fire exploration camp, Cliffs Natural Resources, was dealt a blow last month in gaining road access to its Ring of Fire chromite projects.

Ontario's Mining and Lands Commissioner ruled against the Ohiobased mining giant, which had been seeking an easement to cross the mining claims of KWG in order to build an ore haul road out of its deposits in the James Bay region.

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In a ruling released Sept. 10, the tribunal ruled that granting an easement to Cliffs would interfere with KWG's ability to work its claims since "numerous heavy trucks (passing) every day" would cover up future drilling and sampling sites.

"It's extremely material," said Smeenk of the commissioner's office ruling. "There couldn't be any more material information for the owners of KWG."

KWG has a 30 per cent ownership stake in the Big Daddy chromite deposit with Cliffs, but the junior miner holds a strategic piece of ground.

In 2009, KWG began staking a ribbon of mining claims for a future railroad from its isolated Big Daddy chromite deposit heading south for 328 kilometres to a point on the Canadian National Railway's (CN) main line, just west of the village of Na-kina in northwestern Ontario.

A good portion of that route was atop a sandy ridge or glacial esker, easily the best spot in the muskeg country of the James Bay lowlands. KWG formed a subsidiary, Canada Chrome, to oversee this railroad venture.

"It was my idea to stake the right of way because the (McGuinty government's) Far North Act was going to make securing access in that way impossible," said Smeenk.

At one time, KWG and Cliffs were true development partners, but after a falling out over which deposit to develop first Cliffs went about seeking to secure its own transportation corridor. The best route out of the Ring of Fire belonged to KWG and when Cliffs approached the junior miner for access, it was refused and the matter ended up in the Mining Commissioner's lap last year.

The tribunal ruled there is little room on the sand ridge for the two mining companies to use the same route. Cliffs' proposed road "touches each of the claims (of KWG-Canada Chrome) in some part," said the decision, and there was little indication the ridge could support two transportation systems.

Bill Boor, Cliffs' senior...