Quebec mining and Bill 14https://www.kitco.com/reports/KitcoNews20110824AL_bill_14.html
MONTREAL(Kitco News) - The mining industry is paying close attention of a bill that would amend the existing Mining Act, which could affect current mining investments within the province.
Bill 14 is currently waiting legislation at the National Assembly after being tabled on May 12, three days after the unveiling of Quebec’s $80 million Plan Nord project. The project, spearheaded by Serge Simard, Quebec’s Minister for Natural Resources and Wildlife, focuses on the principles of sustainable development in mining.
Raymond Chabot Grant Thornton, a firm that deals with assurance, taxation, consulting and recovery and reorganization services stated their uncertainty over the bill in part of their global study on the mining sector released last week. It s titled “Facing an Uncertain Future: Government Intervention Threatens The Global Mining Sector.”
“The mining industry is watching Bill 14 closely as these amendments may have a significant economic impact and may also potentially compromise certain investments already undertaken by mining companies,” said Anand Beejan, partner and mining sector expert of the firm. “In order to keep the mining sector going, mining corporates must ensure that key risks are understood and articulated to investors.
“On their side, governments need to understand and appreciate the many positive aspects that mining can and does bring to the economy,” Beejan added.
Beejan believes this could hurt investments already committed by mining companies to the Plan Nord project.
Under the Plan Nord project, announced May 9, mining firms and the Quebec government will invest $80 billion over 25 years to mine gold, diamonds, copper, iron, molybdenum, rare-earths, nickel, lithium and uranium in Northern Quebec.
While Beejan cautioned the government that the bill could be a threat to mining operations, in turn affecting the provincial economy, he still believes Quebec to be one of the best places for the mining sector.
“The Northern Plan has strengthened Quebec’s position as one of the best places to invest in the mining sector in the world, and that’s despite the fact that mining dues increased from 12% to 16% in the last 2010-2011 budget,” Beejan said.
What is Bill 14?
According to a spokesman for Minister Simard, Bill 14 was put together in accordance with the Quebec Mineral Strategy, released in 2009, and the Plan Nord. The main purpose is to introduce provisions to stimulate mining exploration by acting on renewal conditions of claims, he said.
One term of the bill includes that financial guarantees, filed three years beginning at the time the mining lease is issued, cover 100% of the cost of rehabilitating an entire mine site. Penalties would be increased for defaulting on filing the guarantee when scheduled.
Another stipulation focuses on stiffer licensing rules, where stakeholders would have to open a dialog with a municipality or community. A stakeholder would be expected to conduct a public consultation in the region that could be potentially mined which includes informing landowners of a project and inform the municipality of what type of work related to mining will be done, the spokesman said.
Also, mining activities would be withdrawn from urban perimeters and “areas dedicated to vacationing.” The Mining Minister would be able to exclude these zones and refuse certain mining rights in order to avoid conflicts with other territories.
The bill is currently seeking legislation.
By Alex Létourneau of Kitco News aletourneau@kitco.com