“We are very pleased to announce that the Ministry of Finance and Economy of the Government of Quebec has confirmed its interest”
Quebec wants in on a huge Nunavik iron mine project. Quebec says it’s ready to invest money as a minority partner in the Hopes Advance iron mine project near the tiny Nunavik community of Aupaluk on Ungava Bay.
Oceanic Iron Ore Corp. said last week that it had received a Letter of Intent from the Quebec’s ministry of Finance and Economy about its interest in becoming a minority partner in the Hopes Advance project, subject to additional future approval of the Quebec government.
The money that Quebec wants to plow into the project comes from the province’s mining and oil capital fund with $750 million for investment in the non-renewable natural resources sector. That fund was announced in November 2012 in Quebec’s 2013-2014 budget speech.
“Oceanic views the Quebec Government’s LOI as a critical step in securing a senior strategic partner and in obtaining future financing for the project’s initial capital expenditures estimated at $ 2.85 billion,” an Oceanic news release said.
The Hopes Advance project will provide a stable economic base and job creation in the Nunavik region of northern Quebec, the company release said.
The project will also construct “important infrastructure” in northern Quebec, including port facilities.
In November 2012, an independent evaluation of the economic benefits of the Hopes Advance project, led by KPMG Secor, projected the creation of added economic value of $1.9 billion for Quebec in addition to job creation estimated at 22,000 person years, providing employment benefits to Inuit in Nunavik and other regions.
The Letter of Intent from Quebec said the financial contribution will be “further defined” when Oceanic reaches agreement with a major strategic partner for the project.
“We are very pleased to announce that the Ministry of Finance and Economy of the Government of Quebec has confirmed its interest in a project level investment,” said Steven Dean, Oceanic’s chairman and chief executive officer. “This expression of support for Oceanic’s Hopes Advance project demonstrates that the development of the North remains a Quebec government priority.”
The Vancouver-based Oceanic owns deposits from the Roberts Lake area north of Kangirsuk to Hopes Advance Bay in the south, which lies only 10 kilometres from Aupaluk, Nunavik’s smallest community of less than 200 people.
The $2.85 billion project — into which Oceanic plans to sink in another $1.61 billion in 2025 and 2026 — consists of the construction, operation and decommissioning of several open-pit iron ore mines.
These will generate between 10 million and 20 million tonnes of high-grade iron ore concentrate product every year for up to 48 years.
For the shipment of the iron ore to European and Asian markets, Oceanic also wants to build a deep water port facility on Ungava Bay with a 330-metre loading wharf, a tug moorage area, a commercial wharf and a causeway.
The concentrate would then be pumped to port through a 26 km-long pipeline.
The mine complex will run on diesel power generation until 2025 when the company hopes that “Hydro-Quebec has advanced its transmission line to Ungava bay,” says the project description.
That power would likely flow from the Brisay generating station located on the Caniapscau reservoir south of Kuujjuaq.
Construction could begin as early as 2014 with operations starting in 2016.
Oceanic plans to ship its ore directly from Hopes Advance Bay to China on huge carrier ships during summer and through trans-shipment during winter.
The company is looking at using the fiord near Nuuk, Greenland as trans-shipment location.
Makivik Corp., Aupaluk’s landholding corporation and Oceanic have already announced that they have agreed to the terms and conditions on which Oceanic would continue to develop its Hopes Advance Bay project and “set a basis” for a later impact benefits agreement.
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