The Wynne government dangled a huge carrot in front of the provincial NDP to support its spring budget on Thursday, while challenging Ottawa to match dollars on its $1-billion commitment for the Ring of Fire.
During an April 28 press conference in Thunder Bay, Northern Development and Mines Minister Michael Gravelle, Natural Resources Minister David Orazietti and Municipal Affairs Minister Bill Mauro harped on a familiar theme that Ontario hasn’t received its fair share of federal support on large infrastructure developments, compared to hydro-electric and oil projects in other provinces.
And Ottawa, they said, needs to “come to the table,” chequebook in hand, for the Ring of Fire.
“They have spoken on many occasions of the national significance of this particular resource development,” said Gravelle, “and when we see the kind of projects that they have supported in other provinces, the federal government needs to join in and make this happen.”
Gravelle said he placed a courtesy call to federal Ring of Fire Minister Greg Rickford the night before the announcement to advise him of the province’s intentions.
The $1 billion is being channelled into the province’s Ring of Fire development corporation announced last November, which remains very much in the embryo stage.
The organizational structure and the identities of its stakeholders have yet to be determined, but Deloitte Canada has been contracted to come up with a governance model.
What specific projects the money is earmarked for is unclear as well.
Gravelle said the mining companies and First Nations have told the province that in order for decisions to be made, there needed to be dollars on the table.
“We have spoken about a significant provincial investment. We’ve quantified that.”
The government’s estimated price tag to build a transportation corridor into the Ring ranges between $2 billion and $2.5 billion which would include a likely $800-million to $1-billion road for both industry and public use, and a network of branch roads leading into remote First Nation communities near the mineral deposits.
But Gravelle cautioned, “these are not exact costs and we haven’t pretended that they are.”
Figuring that out is up to the Ring of Fire corporation which will be tasked with making the major infrastructure decisions, including deciding the best route into the future mining camp and mode of transportation – either road or rail.
The Ring’s three major mining proponents – Cliffs Natural Resources, KWG Resources and Noront Resources – have all publicized plans for either road or rail corridors running north and south or east and west.
“There’s been no decision on what the route will be,” said Gravelle, but he expects all the corporation partners to be prepared to invest in the corridor.
“What’s fair to expect is that the industry partners will now be in a better position to go back to their shareholders and say we’ve got a strong commitment from the province -- hopefully we’ll have a strong commitment from the federal government -- and now it’s time to make our commitment in terms of infrastructure dollars,” said Gravelle.
Gravelle sidestepped a question on the timing of the government’s down-to-the-wire investment pledge, saying the announcement was the culmination of work toward advancing a resource development project in a remote region that hasn’t seen anything of this scale.
Trust needed to be first established with area First Nations through a recently signed framework agreement with the Matawa chiefs.
“I think we’re making great progress,” he said.
Hopefully, he said, this strategy will resonate with the NDP.
“This is all about the future of Northern Ontario and the province. We are determined to move this project forward in a smart, sustainable, collaborative way, and I certainly hope the NDP recognizes that and do support the budget.”
NDP Northern Development and Mines Critic Michael Mantha, who attended the Thunder Bay press conference, was not available for comment but in a news release said this investment commitment is “coming too late.”
“The Liberal government has had over five years to come to the table, with not only funding for infrastructure, but a real plan for the Ring of Fire that benefits First Nations and Northern communities, creates jobs, and tackles infrastructure and the high price of electricity. But instead of a plan that could create an estimated 5,500 jobs annually, this government stood by as companies walked away from Ontario.”
Conservative MPP Norm Miller, the Northern Development and Mines critic, said the timing of the announcement reads more like a political ploy than a real infrastructure commitment.
“It looks like an election platform than anything else designed to win some support from the NDP.”
Despite the $1-billion pledge and many promises made in throne and budget speeches since 2012, Miller isn’t convinced the Wynne government regards the Ring of Fire as a priority and accused it of foot-dragging in producing a concrete plan toward reaching those mineral deposits.
“It raises more questions than answers. It is road or rail (corridor), an east-west connection or north-south? I’d like to see a bit more details, but based on their past track record I’m a little skeptical.”
Miller thinks the federal Conservative government’s response will be the same.
“Usually when you’re getting ready to spend a billion, and ask for the federal government to match it, you normally have a plan before you do that.”
He called the creation of the Ring of Fire development corporation a “reasonable approach” to bring stakeholders together, “but even on that we haven’t seen much action.”
Miller said it isn’t clear where the money will come from given the province’s ballooning $11-million deficit.
“They’re spending money they don’t have.”
A published report in a Toronto newspaper indicated that Ontario’s deficit will rise for the second consecutive year and that the Liberal government will be hard-pressed to balance the province’s books by 2017-18.
Gravelle said it’s an expenditure the province must make to unleash the enormous economic and social opportunities for First Nations, the province and the country.
“This is a project that requires a vision and it requires an understanding that in order to get this right we need to work with all our partners, First Nations, industry and the federal government.”