Cliffs Natural Resources Inc (NYSE:CLF) – heading for the iron ore peak
Cliffs Natural Resources Inc (NYSE:CLF) has been in line for a long time now, with its proposal to develop the Chromite mine that is situated in a section of Northern Ontario that is called the “Ring of Fire”. The company said that its talks with the government in Ontario for its “Black Thor” chromite project are at a standstill. The wheels of this project have been in brake-mode since January 2013. That is when the new premier assumed office. CLF very categorically maintained that that it will not pursue an approval for transitioning the project to the execution stage until all the core elements that support its economic-viability have been completely resolved. However, there will be no stalling of its consultations and environmental assessments.
Climbing up the Black Thor cliff
Everything said and done, Cliffs Natural Resources Inc (NYSE:CLF)’s project may actually be the stepping-stone to further development in the “Ring of Fire”. The area is far removed from civilization, has seemingly insurmountable infrastructure challenges but the deposit in itself is undoubtedly a world-class one. The actual value of this deposit will become evident only after the chromite has been mined, processed and the resultant ferrochrome sold to stainless steel manufacturers.
What is Chromite?
Chromite is what metal chromium is extracted from. The latter metal is used to add toughness, hardness as well as chemical resistance to steel. Its name has been derived from chromium oxide, its chemical composition. Chromium oxide is a brownish-black mineral with no distinct cleavage and has an uneven fracture. Its crystals are not only small but are rare as well. There are instances where it has been found in octahedrons but it largely exists as a massive structure. Apart from this, some chromite samples may possess slightly magnetic properties.
The “Ring of Fire”
In 2010 April the Ontario Government had announced that a massive chromite deposit would be opened-up for development. This area lies in Northern Ontario and the area that is slated to be mined, is referred to as the “Ring of Fire”. It spans an area of 5,120 sq kms and is considered to hold one of the world’s richest ore-deposits. Minerals such as nickel, copper, diamonds, platinum, gold, silver, palladium and chromite are found in this area. Specifically, the chromite deposit is an incredibly large one. It is believed that it is large enough to feed the Canadian stainless steel for the next hundred years. The company that sets-up mining operations here will no doubt be laughing all the way to the bank.