Ontario Premier Kathleen Wynne announced today in Thunder Bay that agreements have been reached with the Webequie, Marten Falls and Nibinamik First Nations to begin construction of a road to the currently difficult to access Ring of Fire mineral belt. The route would go to the proposed Noront Resources Ltd. (TSX-V: NOR) mining project that Queen’s Park hope will give Northern Ontario a much-needed economic boost as well as link remote communities with other highways.

News of this today, sent shares of Noront Resources Ltd. up 8.5 cents to 41.5 cents on massive volume of 9.1 million shares.  Noront’s 30-per-cent junior partner at the Big Daddy chromite deposit in the region, KWG Resources Inc. (TSX-V: KWG), saw its shares rise a half cent to 2.5 cents on 10.9 million shares traded.

This provincial announcement may prove to be a surprise for KWG Resources, Vice-President of Exploration, Moe Lavigne, as he has been quoted in the past that even he doubted the government’s intentions to advance the road project.

“I have no confidence that the provincial government is really motivated to make this happen. And the reason is that they’re conflicted because they’ve sold that part of the province to the green movement (with the passage of the Far North Act in 2010). They don’t want to be seen building roads in an area they promised to make a park.”

KWG has long been an advocate for the road but a doubtful one.  The company partnered with a Chinese engineering firm to conduct, what amounts to, a pre-feasibility study of KWG’s plans for an ore-haul railway from northwestern Ontario to the James Bay region to carry out chromite for processing.

The company claim-staked a 340-kilometre long rail line running from the CN main line into the Ring of Fire mineral belt and to KWG’s Big Daddy chromite deposit, of which it owns a 30 per cent share with Noront Resources, much to the chagrin of federal and provincial authorities who took to court Noront, Cliff Natural Resources and KWG over the legality of using mining claims to secure surface rights for railroads

This announcement will not change things over night, environmental assessments will begin in January, six months before the June 7 provincial election, and construction is set to start in 2019. However, it has changed the prospects for two juniors miners as they will most likely take the news to raise funds and beat the proverbial drum to attract new investors and appease long time shareholders.

The area lies about 575 km. northeast of Thunder Bay, and west of James Bay.  The funding is part of the government’s promise to invest $1 billion in Ring of Fire infrastructure in the region.

It’s estimated there is $60 billion in mineral deposits in the area, including chromite, an essential component in making stainless steel of which China consumes about 50% of the global supply.

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