Quest Rare Minerals Ltd. (TSX: T.QRM, Stock Forum) has signed a non-binding memorandum of understanding (MOU) with a Quebec bulk shipping company, which is renowned for its track record in the Canadian arctic, and a roster of clients that includes Vale’s Voisey’s Bay nickel project.
Under the MOU, Fednav will provide exclusive transportation and engineering services to Quest on matters related to the mining firm’s flagship Strange Lake rare earths project in northeastern Quebec, which ranks as one of the largest ore deposits of its kind.
Quest is planning to become a leading producer of rare earths, which have applications in a range of industries in Canada and around the world, including hybrid electric vehicle manufacturing, mobile phones, LCD screens, laptops and wind turbines.
Establishing transportation logistics for future production of concentrates from the mine will be key to its success.
Under this agreement, Fednav will supervise the development of detailed ship specifications required to transport concentrate and mine provisions, as well as assistance in berth design, ship-loading equipment, and port operational procedures.
Fednav will also liaise with regulatory authorities and concerned Aboriginal communities, while supporting Quest in assessing operational costs for the ships being considered, including full technical management and crewing.
Fednav and Quest intend to execute a final binding agreement in the future, the companies said in a press release.
“We are extremely pleased to announce the partnership with Fednav on our Strange Lake Project,’’ said Quest President and CEO Peter Cashin. “Their expertise in Canadian and International shipping, particularly in the North Labrador Sea, will strengthen our development plans and assist our project team in building a truly world-class mining operation,’’ he said.
He went on to say that the partnership brings Quest one step closer towards project realization by mitigating some of the infrastructure risk associated with the project, and ultimately, bringing Strange Lake a step closer to production.
“We are proud to be partnering with Quest on this very special project,’’ said Paul Pathy, President and CEO of Fednav Ltd. “The development of Strange Lake as a major provider of rare earths is a unique opportunit, with the potential for worldwide economic impact,’’ he said.
Quest shares rose 3% to 17 cents on the news, leaving a market cap of $13.4 million, based on 78.6 million shares oustanding.
FULL DISCLOSURE: Quest Rare Minerals is a client of Stockhouse Publishing