What uncertainties have QMA companies faced throughout the pandemic, and how have they navigated them?
In 2020, the main concern for the mining industry was to stay in operation while putting strict measures in place to prevent the propagation of Covid-19. The mining sector was shut down for three weeks last spring, but we did not know then that it would be for three weeks. Five mines continued operation; the niobium mine and iron ore mines as they are part of the steel value chain and the smelters were deemed essential, given they take months to shut down and to start up, the salt mine as well was deemed essential for public safety reasons since the salt is used to deice the roads The QMA was in constant discussion with our health and safety commission and public health in order to make sure that the strict measures to prevent COVID-19 (social distancing, personal protective equipment, testing labs, etc.) put in place by the industry were efficient.
On the other hand, commodity prices have been very favorable for gold and iron ore, which are the two most important minerals in Québec.
Mining projects in development have also experienced uncertainties as they still must go through one provincial and one federal environmental permitting process. Both permitting processes were under review in the last few years and now we must learn to work with them.
What makes Québec unique as a mining jurisdiction?
With our use of clean energy (hydropower) and strong regulations regarding environment protection and our social practices in relation with local communities, the region is a responsible source of minerals.
Québec’s public policies also distinguish us as the government is eager to put this region on the map as a responsible source of critical minerals. For this, they have developed a critical mineral development plan and a battery strategy. Our province also has a highly qualified workforce, great expertise and there are excellent training institutions.
What socioeconomic impact does the mining industry have in Québec?
The industry hires about 48,000 people directly and indirectly. We have also found that even though mines are located in remote regions, workers live all across Québec, which favors the distribution of wealth. Overall, in 2018, the fiscal and parafiscal revenue generated by the mining industry is estimated at C$1.3 billion for the Québec government (not counting corporate income tax). Total mining industry expenditure in Québec was C$9.9 billion in the province in 2018, with benefits across the province.
How do you see the health of the mining industry today and the prospects for funding mining projects?
Financing for mining projects has not been easy in the last few years, especially for critical minerals; they cannot only mine the minerals but also process and transform them. For the critical minerals, we must work on the demand side. This means a new value chain must be built, instead of only a mine, so it is difficult to secure their financing as it entails more risks. I believe the government is starting to understand that we cannot look at the development of these mines as we used to do with iron ore or gold, as it is a totally different business model. This is why the government has developed their battery strategy to incentivize battery manufacturers or components manufacturers to build their plants in Québec and this way they are able secure the demand for these minerals.
How do you see the industry evolving over the next 2-3 years and what role is QMA going to play in this industry?
Mining Investments in Québec have decreased since 2012, and seem to be on a plateau since 2014. The government must put policies in place to change this situation and increase investment. There are currently 22 mines in operation in the province and the QMA is working hard to promote the appropriate conditions for new projects to be developed. We are pushing the government to streamline permitting processes and urging the federal and provincial governments to work together to establish only one environmental permitting process. We are also exploring how the tax regime can promote investment in Québec. Finally, we believe health and safety regulations should be adjusted so that they evolve at the same rate as new technologies.