TORONTO (CU)_A few weeks ago, Australian mining company Wyloo Metals put an end to a prolonged bidding war with fellow Australian mining giant BHP Group, by offering $617 million offer to acquire Canadian nickel miner Noront Resources Ltd. Under the new ownership, Ontario’s James Bay Lowlands, known as the Ring of Fire, is set for speedy development although challenges loom on the horizon.
The mining district has been described by the head of Wyloo Metals, Luca Giacovazzi, as one of the most prospective mineral belts in the world. Recently he revealed that he is committed to building a nickel mine there over the next five years, with the aim of supplying raw materials for an electric vehicle battery supply chain in Canada.
“It’s almost like you’re handed the perfect deposit,” he told the Financial Post. “The best way to think of it is, in our neck of the woods, in western Australia, [this] would have been mined out ten years ago. It would have started mining ten years ago and it would have been at the end of its mine life by now — that’s how high quality the ore body is.”
However, unlike Giacovazzi had anticipated, it has not been mined yet, and there are several reasons for that. The first is its location, since the Ring of Fire is sited in the second largest peatlands complex in the world, where about 35 billion tonnes of carbon are being stored. On the other hand, the mining district is also located in a broader region which inhabited by a dozen First Nations communities, some of which are in opposition to a large scale-mining project in what remains a pristine area.
These factors mean that the project would require a taxpayer investment of over $1 billion in roads and infrastructure, for which a half-dozen federal and provincial environmental assessments will be needed. Nevertheless, the total impact of opening the area to development cannot be determined until Wyloo takes control and reveals which mines and mineral deposits it intends to develop. For now, it is clear that the mining company is heavily focused on nickel, a metal which is seeing a hike in demand and a surge in prices as countries across the globe call on automakers to offer and sell more electric vehicles.
