Noront plans to build ferrochrome smelter in Sault Ste. Marie

Noront Resources says it will build a ferrochrome production facility in Sault Ste. Marie that will process ore from the Ring of Fire.

The city and Noront made the announcement on Tuesday.

"This establishes what we know to be true: Sault Ste. Marie is a great place to do business," Sault. Ste. Marie Mayor Christian Provenzano said.

Noront, a Canadian-based mining company, controls a large land position in the Ring of Fire, a mineral-rich area in the James Bay lowlands in northern Ontario.

Once in operation, the smelter facility will employ between 300 and 500 people, along with another 1,000 indirect jobs to be created through suppliers and other businesses. Noront plans to build the smelter on Algoma Steel property, pending the finalization of a land agreement.

"Sault Ste. Marie was selected based on its environmental and site sustainability, capital and operating costs and an assessment of community acceptance for hosting the facility," Alan Coutts, president and CEO of Noront said.

"We anticipate a lengthy and comprehensive environmental permitting process for our ferrochrome production facility, which will allow us to engage in a fulsome way with the citizens of Sault Ste. Marie and other stakeholders including environmental groups and First Nations."

What's next

The city says after environmental and feasibility agreements are completed, along with community consultation and engagement, the project will be tendered for construction.

Work to build the smelter is expected to start in 2025 and will take about three years to build with an estimated cost of about $1 billion. The city adds that timeline is based on the development of road infrastructure to the Ring of Fire.

Premier Doug Ford says he's pleased the company has announced the location for the smelter.

"Our government promised to make northern Ontario open for business and open for jobs," he said.

"This new processing plant has the potential to create hundreds of direct and indirect jobs, benefiting skilled resource and manufacturing workers across the region."

How did Sault Ste. Marie get chosen

Initially, four communities in northern Ontario were vying to have the smelter built in their community: Sudbury, Thunder Bay, Timmins and Sault Ste. Marie.

The company says "all submissions were evaluated based on a comprehensive set of criteria," and "critical factors included environmental and site suitability, capital costs, operating costs and an assessment of community acceptance for hosting the facility.

Sudbury and Thunder Bay were eliminated in July 2018. At that time, Noront said although Sudbury's proposal for the smelter had the lowest operating costs, "it included significant capital costs such as site preparation earthworks, and reestablishment of critical infrastructure."

The company went on to say "it also faced strong opposition from the local community."

Noront said it was no longer considering Thunder Bay's Mission Island as an ideal spot as it noted the "proximity to the water, along with expensive access to infrastructure."

Since then, the company has been looking at Sault Ste. Marie or Timmins for the facility.

Coutts says Sault Ste. Marie offered a lower operating cost than Timmins.

"Being on the water, close to markets and also being able to bring materials and supplies and goods in and out by laker had a much superior operating cost advantage and that's why we chose the Sault," he said.

"It was a very difficult decision because both cities submitted excellent proposals," Coutts said.

"In the end, we were persuaded to go with Sault Ste. Marie because it is located on the Great Lakes and offers a lower long-term operating cost advantage. When you're dealing with an operation that might be around for 100 years, having that low cost every year is a big, big advantage."

The company says the next step is to finalize the development plan and timelines for an all-season road to the Ring of Fire.

'It's not over until it's over'

Timmins mayor George Pirie says he's disappointed in the announcement from Noront. However, he says "it's not over until it's over."

"We know it will be a number of years before any facilities are built," he said.

"We think that we'll have time to affect the decision. We don't think Noront will be the company that builds the facility. They don't have deep enough pockets required to build it and will have to bring in a bigger partner."

Pirie says if another company were to purchase Noront, that could mean a different location for the smelter. 

The land claims owned by Noront in the Ring of Fire region were purchased from Cliffs Natural Resources in 2015.

Before Cliffs sold the claims, it had announced it intended to build the ferrochrome smelter in Sudbury. Cliffs had hoped to open the facility in Capreol in 2016 and more than 900 applicants applied for jobs.