Challenges in Making the Green Dream a Reality

A century ago, when mining firms discovered a commercially viable deposit in Québec, they would build a town around it. Mining would spur the influx of the socio-economic development with people from and other industries drawn in, like Schefferville, Gagnonville, and to an extent Val d’Or. When there was a mine, there was a town. Today, pushed by both shareholder value and employee preferences, the business model has shifted from building a town to building camps around mining sites. The Fly-In-Fly-Out model allows workers from Montréal and Sherbrooke to spend a couple of weeks at a northern mine before returning home to spend their pay. Particularly given the growing importance of ESG and Canada’s long-term social contract, in a region where 60% of inhabitants are Crees and Inuits, reaching a balance between business models will be key for a fair economic development of the North. Patrick Beauchesne, CEO of Société du Plan Nord, a body in charge of implementing the government’s Nordic development plan, explained: “(Communities) see workers flying overhead and leaving without contributing to local socio-economic development. With skilled workers coming from the south, these models contribute to the erosion of the social fabric in the north.”

Unlocking land access to the territory will most likely be the way forward to develop mining activity in the north and subsequently offer opportunities to local populations. In Fermont, with ArcelorMittal, the Société du Plan Nord helped set up a project to offer 40 homes, encouraging the local workforce to settle in the community. To go further, the Société developed a C$2.6 billion investment plan for the Northern territory. The lion's share will be dedicated to infrastructure; developing projects like Winsome’s Adina are isolated in the North, and many sites are only served by one road, which would quickly become congested in the case of wildfires causing the need for immediate evacuation. Beauchesne added: “If you add up all the roads in the Northern Territory, there are 3,300 linear kilometers in an area twice the size of France. In Nunavik, there are only two modes of access: by air, or by sea during a window of 4-5 months a year. Access to the territory represents a major challenge for the mining industry.”

What was once plenty is now in shortage. Québec’s hydropower resources are depleting, in a turn of events that many executives have called the biggest challenge to the mining industry in the province in the coming months. Over 40% of Canada's water resources are in Québec and the province benefits greatly from hydropower. For access to that power mining firms are competing intensively. And from industry associations to financiers and miners alike, the evidence is clear: There will not be enough for everyone.

In the North, the James Bay project is Québec's largest generation complex, with an installed capacity of 16,527 megawatts (MW) of power, approximately 40% of the province's peak load. A wave of projects entering the developing phases in the James Bay has saturated a system that once had plenty in storage. Since January, Osisko Mining’s Windfall project has been powered by hydroelectricity, through a 95-km, 69 kV power line built, owned, and operated by Waswanipi Cree First Nation. Similarly in the Abitibi, producers and providers like Hydro Québec have reported that power lines are at capacity. Louis-Nicolas Boulanger, partner at McCarthy Tétrault, who has notably been helping clients with accessing Québec’s hydro advantage, added: “The biggest challenge is currently the electricity supply. Ensuring sufficient electricity for critical minerals projects is crucial, as these projects rely on clean energy for their green energy transition goals.”