UPDATE 1-Canada approves massive Arctic iron ore mine

Mon Dec 3, 2012 7:21pm EST
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* Developer Baffinland needs project certificate, water permit

* Massive infrastructure needed to make mine a reality

* Iron ore prices falling on slower demand from China

By Julie Gordon

TORONTO, Dec 3 (Reuters) - Canada, hoping to spur economic development of its far north, has approved the construction of a massive iron ore mine in the Arctic territory of Nunavut that could help top steelmaker ArcelorMittal reduce its dependence on outside suppliers.

The open-pit Mary River project on remote Baffin Island was approved on Monday by the Minister of Aboriginal Affairs and Northern Development, based on the recommendation of the Nunavut Impact Review Board.

"It's a game changer for Nunavut and particularly for Baffin Island," said Minister John Duncan.

The project "will bring infrastructure and much economic activity and many jobs to the area and, of course, revenues to government and to the Inuit organization," he said, referring to the Inuit aboriginals in the region.

That said, Mary River - which could to produce at least 18 million tonnes of iron ore a year over a 21-year mine life - is still years away from production, if it ever gets off the ground.   Continued...