Charest government may have miscalculated announcement to reopen Jeffrey Asbestos Mine with a $58-million loan – by Michelle Lalonde, (Montreal Gazette – July 30, 2012)

GAZETTE Environment Reporter

QUEBEC – If the Charest government was hoping to avoid criticism by quietly announcing the relaunch of Quebec’s controversial asbestos industry on the Friday before a holiday weekend, it might have miscalculated.
In the month following the June 29 announcement that Quebec would loan $58 million to help reopen and expand the Jeffrey Mine in the town of Asbestos, newspapers across Quebec and Canada have run editorials and columns condemning the decision. The wisdom of staking public money on this project has come under question, and last week an international scientific organization of epidemiologists joined the call for a global ban on asbestos.
In April 2011, the Liberal government had promised to provide a guarantee on a $58-million loan to the project’s proponents — Westmount businessman Baljit Chadha and Jeffrey Mine president Bernard Coulombe — if and when they could come up with $25 million in private investments to enable the reopening of the mine.
The government is now providing a direct loan rather than a guarantee, and critics charge that’s because no financial institution would loan the money, even with a government guarantee. Asked why the government decided to provide a direct loan, an aide to Economic Development Minister Sam Hamad said only that it was done to speed up the relaunch.
“The Quebec government has done this in order to accelerate the process of the relaunching the Jeffrey Mine,” Economic Development Ministry spokesperson Jean-Pierre D’Auteuil wrote in an email, days after the question was posed in an interview.

Finding investors proved to be no easy task. Although, Chadha and Coulombe had earlier indicated they had an international consortium of interested investors behind them, in the end they seem to have found only one: Ulan Marketing Co. Ltd. of Thailand.

That company has put down $14 million, and the remaining $11 million in private investment has been scraped together by Chadha and Coulombe themselves, Guy Versailles, a spokesperson for the Jeffrey Mine, confirmed in an interview with The Gazette.
Chadha and Coulombe are now co-owners of a new company called Mineral Fibre Inc. which owns the Jeffrey Mine.

“Mr. Coulombe and Mr. Chadha have already put their money into an account at the mine, and Ulan of Thailand has put in $14 million. The $25 million is there. That money is there. It is in the bank account of the mine,” Versailles said.

For the rest of this analysis, please go to the Montreal Gazette website: