Noront says Sault Ste. Marie has lower long term operating cost
Sault wins site selection choice for a new ferrochrome productions facility
Noront Resources Ltd. (TSX Venture: NOT) has selected the Algoma Steel Inc. site in Sault Ste. Marie for its Ferrochrome Production Facility (FPF). The Timmins Kidd Metsite is no longer being considered, said a news release from the company this morning.
Four communities participated in the initial bidding process which began in February 2018. All submissions were evaluated based on a comprehensive set of criteria determined by Noront and the engineering firm Hatch, which was engaged to assist in the adjudication process. 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 of 2018. After a thorough and rigorous analysis of the two remaining sites in Sault Ste. Marie and Timmins, the Timmins Kidd Metsite was eliminated as well. A further refinement of the operating and capital costs of the final sites was completed with the following results:
- Timmins is the slightly lower capital cost option; and
- Sault Ste. Marie has a lower operating cost per pound of chrome in ferrochrome.
The two sites are similar on a discounted NPV (net present value) basis, but on a cash flow basis, when a potential 100-year life for project is accounted for, the analysis favours Sault Ste. Marie.
“It was a very difficult decision because both cities submitted excellent proposals,” said Noront President and CEO Alan Coutts. “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.”
Sault Ste Marie Mayor Christian Provenzano commented, “This establishes what we know to be true: Sault Ste. Marie is a great place to do business. I want to recognize the efforts of the FPF project team, the support of the executive leadership at Algoma Steel, and the support of MP Sheehan, MPP Romano, Batchewana First Nation Chief Sayers and Garden River First Nation Chief Syrette. I also want to ensure our community and our Indigenous partners that we are committed to substantial consultation and engagement as we move forward.”
“Our government is committed to growing the economy, creating good jobs, and most importantly, ensuring that Northern Ontario is open for business,” said Greg Rickford, Minister of Energy, Northern Development and Mines. “Today’s announcement confirms that commitment. Congratulations to Noront Resources and the City of Sault Ste. Marie.”
The next step will be to finalize the development plan and timelines for an all-season road to the Ring of Fire with the provincial government and their community partners. Noront anticipates a lengthy and comprehensive FPF environmental permitting process which will allow the Company to engage in a fulsome way with the citizens of Sault Ste. Marie and other stakeholders including environmental groups and First Nations.