How would you assess the overall health of Québec’s mining ecosystem in 2021?
Over the years, Québec has developed extensive expertise throughout the mining value chain that is recognized worldwide. We have an ecosystem of professionals including technical staff, lawyers, accountants, and a very sophisticated funding platform that supports the mining sector throughout the different phases of a project. This makes us stand out from other mining jurisdictions.
Since the beginning of the pandemic, the price of gold has really taken off and this has been very beneficial for Québec, as nine out of our 22 mines are gold mines. Now, we are also observing hype around strategic metals, with important discoveries in graphite and lithium. However, it is necessary to start carrying out the process of transforming these minerals locally in Québec. There is willingness both from the Québec government and from the federal government to support this industry because of their interactions with the US government and their need to put their hands on strategic minerals from reliable sources. Therefore, I believe there are some good years ahead of us for the development of a secondary transformation industry and the discovery potential is definitely there.
What have you seen on the acquisitions front over the last year?
When the pandemic hit in March 2020, it caused great uncertainty. Many of our clients had transactions related to gold that were subject to concurrent financings and they were unsure what to do regarding cancelling or postponing. I had to request extensions for those deals, and four months later, these deals were not only being closed, but they were over-subscribed in terms of the concurrent finance. This gives an idea of the shift that happened in 2020: suddenly, a huge amount of capital started flowing into mining, and gold played a huge part in this. We are certainly in a hot market right now. It started with gold, but now we are also closing financings for other elements such as lithium and graphite, which we did not see before. There is significant M&A activity on the gold front, and some in copper. It is an exciting time to be in the industry.
What initiatives does the government of Québec have in place to support the mining industry?
Québec has a unique financing system. For example, Investissement Québec and Caisse de dépôt et placement du Québec (CDPQ) are quasi-government entities that provide financial support to the mining industry. The flowthrough regime is very generous for mining exploration and the tax credits given for exploration in northern Québec are remarkable. I am also the Chairman of a mining exploration investment fund, SIDEX, created 20 years ago by the FTQ Solidarity Fund and the Government of Québec to support the diversification of exploration in the Province of Québec. This fund plays an important role in the ecosystem. Furthermore, the government is also making efforts to eliminate some of the red tape, as it currently takes more than 200 or so permits to put a mine into production.
How do Québec’s community relations differ from other leading mining jurisdictions and what are the keys to successfully negotiating deals with First Nations?
Québec’s relationship with First Nations are based on strong relationships and landmark agreements signed over the years which determine what can and cannot be done, and this is what sets us apart from other mining jurisdictions.
The key to success when dealing with community relations is essentially respect and transparency. First Nations must be informed about mining projects in their region and they need to be involved in the process.
Do you have a final message for GBR’s audience about what makes Fasken a valuable partner in the industry?
Fasken is recognized worldwide for its mining expertise. We have extensive experience serving the whole mining value chain and supporting the evolution of projects in any phase, from their beginning until their closure. We can also provide services to all-sized companies, including start-ups, juniors and big producers. This differentiates us from the rest of the pack. Finally, we have a very passionate and experienced team in Québec.