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Quebec Mining

Bay Street: Steel slump puts crimp in Labrador Trough – Julie Gordon (Reuters Canada – December 3, 2012)

http://ca.reuters.com/

TORONTO (Reuters) – “Strike while the iron is hot,” the old saying goes, and a legion of iron ore miners setting up in Canada’s remote Labrador Trough want to do just that. But, for now, they have to wait.

Iron ore, the main component of steel, has turned ice cold in recent months, with the benchmark price .IO62-CNI=SI plunging to $86.70 a tonne in September from $149.40 in April. It has since recovered to about $116 a tonne.

The downward spiral has jeopardized the viability of the sub-Arctic region’s vast iron ore deposits just as the first new mines in decades were opening. Some projects are being put on hold.

As a consequence, shares of junior miners such as Alderon Iron Ore Corp (ADV.TO: Quote), Champion Iron Mines Ltd (CHM.TO: Quote) and Century Iron Mines Corp FER.TO, have tumbled as projects that looked rich at $150 a tonne suddenly lost their luster.

Still, analysts say the region’s potential remains compelling. They caution, though, that investors must look closely at the contenders to judge which are best placed to ride out the bad times and prosper over the long term.

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Labrador City’s huge worker shortage threatens small businesses – by John Shmuel (National Post – December 3, 2012)

The National Post is Canada’s second largest national paper.

Finding employees is one of the biggest issues businesses here have

When construction began on a new hotel in Labrador City this year, the developers didn’t even have to finish building it before every room was booked for the next three years.

Welcome to one of northern Canada’s most rapidly growing boom towns. The fuel behind it all are the massive iron ore mines near Labrador City and its twin town, Wabush. The area’s mines have been ramping up in recent years as rising global demand for steel is creating an insatiable appetite for iron.

High pay for working in the mines, which can start at nearly $50 an hour even with minimal experience, has attracted a flood of workers from Atlantic Canada and the rest of the country. It has also, however, created a series of challenges in a region of Canada that is more accustomed to losing workers to other provinces.

“Finding employees is one of the biggest issues businesses here have,” says Jeannot Gamache, of Labrador Rewinding Inc., a motor repair business in Wabush that has been around since 1994.

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Canadian Royalties aims to start shipments from Nunavik Nickel in 2013 – by Jane George (Nunatsiaq News – November 28, 2012)

http://www.nunatsiaqonline.ca/

More than 650 people already working on site

A Chinese-owned mine in Nunavik will soon see huge ice-class vessels sailing through Hudson Strait to bring nickel, copper, platinum and palladium to European markets.

After sinking $735 million into infrastructure, Jien Canada Mining Ltd., the owner of Nunavik’s second soon-to-be operating mine, plans to ramp up production in early 2013 and hire more Nunavik workers.

The mine company, which expects to reach full production by 2014, will produce nickel, copper, palladium and platinum for at least 13 years. Located 20 miles from Xstrata Nickel’s Raglan nickel mine, the Nunavik Nickel mine sits in “one of the most inhospitable places in the world,” said its president, John Caldbick in a recent interview.

But the cold, rocky plateau is rich in minerals, and early in 2013 the mine will start processing ore. More than 650 people are now on site, living in its 428-person main camp and other temporary camps. Some workers are excavating ore from the Expo open pit mine, while others complete essential parts of the mine’s infrastructure.

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NEWS RELEASE: Northern Superior Resources Inc. Named [Quebec] 2012 Prospector of the Year

November 22, 2012 08:00 ET

www.nsuperior.com

SUDBURY, ONTARIO–(Marketwire – Nov. 22, 2012) – Northern Superior Resources Inc. (the “Company” or “Northern Superior”) (TSX VENTURE:SUP) is pleased to announce that it has been named the 2012 “Prospector of the Year” by the Association L’Exploration Miniére du Québec (AEMQ). According to its web site, “each year the AEMQ recognizes and honors the dynamism and entrepreneurship of companies and individuals involved in the development of Quebec’s mining and exploration industry.”

Specifically, the AEMQ “Prospector of the Year” award is presented to “highlight the importance of a new discovery that produced a significant ripple effect on exploration activities with regard to both the property itself and the surrounding area” and was awarded to Northern Superior in recognition of the importance of the Croteau Est Gold discovery in the Chapais, Chibougamau and Oujé-Bougoumou regions of Quebec.

Since commencing operations on the Croteau Est property in August of 2011, Northern Superior’s exploration programs have defined and continue to expand a gold-bearing alteration corridor that extends to at least 450 m depth, is at least 1,000 m in length and 50 to 150 m in width. The alteration corridor and associated gold mineralization (75.44 g/ t over 4.80 m; 8.16 g/ t over 19.55 m, as examples) remains open along strike in both directions and at depth (see press releases March 1, June 11, October 8, November 12, November 20, 2012).

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Quebec miners in holding pattern as province finalizes royalty, exploration rules – by Nicolas Van Praet (National Post – November 26, 2012)

The National Post is Canada’s second largest national paper.

MONTREAL — Companies mining in Quebec are expected to ship $9.6-billion worth of minerals this year, double the amount exported only five years ago. But the boom taking hold is being complicated by political uncertainty and competing visions over just how far taxpayers should go in backing companies digging valuable resources in their midst.

Quebec’s Chambers of Commerce Federation says several companies have told its officials they are currently suspending new natural resource and mining investments in the province until the Parti Québécois government finalizes a royalties regime and further clarifies exploration rules. But even established companies tapping existing mines are experiencing growing pains and finding it’s next to impossible to build definitive societal consensus for their projects.

Two particular events illustrate the difficulty miners are having in keeping Quebecers on side.

On Monday, Osisko Mining Corp., the Montreal-based firm operating Canada’s largest open-pit gold mine in Malartic near Val D’Or, confirmed that the head of the independent citizens committee monitoring the mine through to its eventual closure quit. Bernard Gauthier’s resignation came after another member of the seven-person committee said over the weekend the entire group was poised to quit on Wednesday to protest the alleged heavy-handedness of the company in their affairs.

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Canada’s last asbestos mine may have future as Mars stand-in – by Peter Rakobowchuk (Globe and Mail – November 25, 2012)

Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

MONTREAL — The Canadian Press – Canada’s last asbestos mine, now winding down its operations, may have a new celestial calling — as a stand-in for planet Mars. Quebec’s Jeffrey Mine hosted nearly two-dozen scientists recently for a simulated Mars mission initiated by Canada’s space agency.

The scientists from four universities made a pair of trips to the Asbestos region, this year and last year, accompanied by a micro-rover. “There are definitely areas (on Mars) that are much more like what we have at Jeffrey Mine,” said Ed Cloutis, a University of Winnipeg professor who participated in the project. The new vocation won’t exactly replace the once-mighty asbestos industry as an economic lifeblood for the region.

The mine had been counting on a $58-million government loan to renovate and keep operating. The simulated Mars mission, on the whole, cost $800,000 — and some local officials, including an alderman and the town’s director general, didn’t even appear to be aware of the project when contacted by The Canadian Press.

The goal of the project was to simulate as closely as possible a Mars rover mission to detect the presence of, and determine the source of, methane on Mars.

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Quebec budget: Marceau says mining royalties plan isn’t ready yet – by Lynn Moore (Montreal Gazette – November 20, 2012)

http://www.montrealgazette.com/index.html

QUEBEC — A widely-anticipated hike in mining royalties didn’t make it into the Parti Québécois government’s first budget because of time constraints, Finance Minister Nicolas Marceau said on Tuesday.

But he and other cabinet ministers are hammering out that royalty framework for natural resources development, Marceau told the National Assembly.

“We want to bring in these changes in an orderly and responsible manner to ensure the stability of the mining sector. We will consult the industry and the stakeholders concerned about this issue so that everyone benefits from the changes that will be made,” he said.

Earlier, Marceau told reporters that the new regime will be unveiled “sooner rather than later.” “In the time I had at my disposal (since the election), it wasn’t possible to arrive here today with a royalties regime,” he said.

During the election campaign, the PQ said it would introduce a five-per-cent royalty on all mining operations, increasing it to 30 per cent if the mine’s profits reached a certain level. Marceau said he remains convinced that an “obligatory royalty based on the net value and a tax based on excess profits are still viable approaches.”

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New Quebec budget delays moves on mining royalties – by Louise Egan (Mineweb.com – November 21, 2012)

 http://www.mineweb.com/

The first budget from Parti Quebecois since it won a September election is being viewed as far more conciliatory than expected, especially toward business.

QUEBEC CITY (REUTERS) – The Canadian province of Quebec promised on Tuesday to overhaul its system of mining royalties next year in a budget that was otherwise seen as more business-friendly than expected.

After winning a September election, the separatist Parti Quebecois (PQ) ruffled feathers in the corporate sector with talk of increasing the financial burden on wealthy households and on companies in order to pay for tax breaks for low and middle-income households, as well as to cover the cost of reversing the previous Liberal government’s decision to raise university tuition and electricity rates.

While the PQ, which has a minority of seats in the legislature, says it still plans to follow through on some of those promises, it scaled back those ambitions somewhat in a budget seen as more conciliatory.

“If we listened to their promises during the election campaign and then look this budget, it’s not the same government,” said Carlos Leitao, chief economist at Laurentian Bank.

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PQ makes oily mess with its pipeline rhetoric – by Sophie Cousineau (Globe and Mail – November 17, 2012)

Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Just when you think the Parti Québécois has finally put the lid on the outbursts and non-scripted remarks that characterized the party’s first days in power, here comes Daniel Breton.

On Wednesday, Mr. Breton, Quebec’s Environment Minister, said the province could block Enbridge Inc.’s project to transport oil from Alberta to Quebec on environmental grounds. Never would Mr. Breton accept the reversal of the flow of the pipeline between Sarnia and Montreal if it were imposed by Ottawa against Quebec’s will. “What I see is Alberta wanting to transport its oil on our territory without our consent. Are we masters of our own territory or not?” he said, even if is unclear whether the province has authority over the project, which the National Energy Board will review.

After a call from Pauline Marois’ office, Mr. Breton tamed his words. Even his colleague Martine Ouellet, the Natural Resources Minister who has made incendiary remarks of her own, tempered the discourse of this former activist, who is so green he glows in the dark. “There are economic advantages with respect to costs and it also represents an alternate source of supply,” she noted.

There are also political advantages in saving jobs.

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Quebec shows tougher approach toward mining sector with access road deal – The Canadian Press/CTV News (November 15, 2012)

http://www.ctvnews.ca/

QUEBEC — Quebec’s new government is living up to its pledge to take a tougher stance with mining companies after offloading some responsibility for the construction of a controversial access road.

Finance Minister Nicolas Marceau announced Thursday that Quebec has renegotiated a deal that will see Stornoway Diamond Corp. (TSX:SWY) assume a bigger share of the costs to build a route to its proposed mine.

Marceau expects the agreement on the 240-kilometre highway extension to the Renard diamond mine site will save Quebec taxpayers at least $124 million. “We’re not going to build gold-plated roads with huge cost overruns,” Marceau told a new conference.

“The signal we’re sending to mining companies is that we’re ready to make deals with you, but the terms must be reasonable for Quebec taxpayers.”

PQ officials had expressed concern that costs for the Route 167 project had exploded beyond the estimated budget of $260 million in 2009. By August, the price tag had soared to $472 million.

The new deal will drop the maximum cost down to $304 million, the government insists. The PQ has criticized the previous Liberal government’s northern-development plan — known as the Plan Nord — for being too generous to the mining sector.

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Stornoway strikes new deal with Quebec on diamond mine road – by Nicolas Van Praet (National Post – November 16, 2012)

The National Post is Canada’s second largest national paper.

MONTREAL – Stornoway Diamond Corp. has struck a new deal with the Quebec government on a controversial highway leading to its Renard diamond mine that will see it pay a bigger share of the total costs but ensures construction of the mine itself remains on target for 2013.

The renegotiated agreement is the first of several the Parti Québécois government is looking to revamp as it grapples with significant cost overruns on 20 major infrastructure projects inherited from the previous Liberal administration. The new deal saves Quebec taxpayers $124-million and marks the start of new effort to recoup public money that was bargained away to benefit the private sector, PQ ministers said.

“There are other cases where it will be harder to save money, but we’ll do as much as we can on all the projects,” Quebec Finance Minister Nicolas Marceau told reporters. “We will make sure that, in those deals, Quebecers are not paying too much.”

The Stornoway deal involves the Route 167 extension, a 243-kilometre all-season highway leading to the company’s Renard site. The road, championed publicly by former Premier Jean Charest as one of the centrepieces of his Plan Nord development project, had become a political lightning rod after costs ballooned from initial estimates of $260-million to more than $470-million.

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Osisko buying Queenston Mining in all-stock deal – by Craig Wong (National Post – November 13, 2012)

The National Post is Canada’s second largest national paper.

Canadian Press – Osisko Mining Corp. signed an all-stock deal Monday valued at $550-million to buy Queenston Mining Inc. and its flagship Upper Beaver project in Ontario’s Kirkland Lake region.

Osisko president and chief executive Sean Roosen said work on the Upper Beaver project is coming to a critical stage in its development. “We feel this is the perfect time for us to bring our mine permitting and development teams into the project to back the plan and to make Upper Beaver a successful mine,” Mr. Roosen said on a call with analysts.

“We also have the ability to fund Upper Beaver development from internal cash flow so we don’t anticipate any further dilution as we evolve these projects.”

Queenston also owns several other gold properties in the Kirkland Lake gold camp area as well as interests in projects in Quebec, Manitoba and elsewhere in Ontario.

Queenston president and CEO Charles Page said the Upper Beaver project has the potential for four million ounces of gold. “Osisko’s proven development team can certainly maximize the potential of the Upper Beaver project,” he said.

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NEWS RELEASE: OSISKO ANNOUNCES FRIENDLY ACQUISITION OF QUEENSTON

November 12, 2012

MONTREAL, QC and TORONTO, ON – November 12, 2012. Osisko Mining Corporation (“Osisko”) (TSX:OSK) (FRANKFURT:EWX) and Queenston Mining Inc. (“Queenston”) (TSX:QMI) (OTCQX:QNMNF) are pleased to announce that they have entered into a definitive agreement (the “Agreement”) pursuant to which Osisko will acquire, by way of a court-approved plan of arrangement, all of the issued and outstanding common shares of Queenston. Queenston is a Canadian mineral exploration and development company with a primary focus on its holdings in the historic Kirkland Lake gold camp comprising 230km2 of prime exploration lands on trend with Osisko’s flagship Canadian Malartic mine.

Pursuant to the terms of the Agreement, Queenston shareholders will receive 0.611 of an Osisko share for each common share of Queenston held, implying an offer of C$6.00 per share based on Osisko’s closing price on the Toronto Stock Exchange (“TSX”) on November 9, 2012. The offer represents a 45% premium to Queenston’s 30-day volume-weighted average price (“VWAP”) for the period ending November 9, 2012.

The transaction values Queenston’s equity at approximately C$550 million on a fully diluted in-the-money basis and implies an enterprise value of approximately C$400 million. Pro forma the transaction, Queenston shareholders will own approximately 12% of Osisko (based on fully diluted in-the-money shares outstanding).

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Black clouds over Plan Nord – by Alain Castonguay (CIM Magazine – November 2012)

http://www.cim.org/en.aspx

PQ calls for revision of mining royalty regime

When Quebec’s Legislative Assembly was dissolved on August 1, the Charest government was unable to pass two significant legislative acts regarding resources, namely Bill-14 that would create a foundation for an innovative mining development model, and Bill 27, a bill to establish the corporation La Société du Plan Nord. Even the budget bill, which notably sought to modify the royalty regime for land-based oil extraction, failed to pass.

This year’s election saw Martine Ouellet, current minister of natural resources, re-elected on the Parti Québecois (PQ) ticket in Vachon. Ouellet actively worked to block Bills 14 and 27. PQ candidates Lorraine Richard (René-Lévesque) and Luc Ferland (Ungava) were also re-elected. These two members of the national assembly used the time allotted to them to delay the detailed study of bills in a parliamentary committee. Richard and Ferland, who have been very critical of Plan Nord, beat out the incumbent Quebec Liberal Party (PLQ) candidates in Fermont and Lebel-sur-Quévillon.

On August 23, in Montreal, the Fédération des chambres de commerce du Québec used the election campaign as a chance to hold a debate on natural resources. Participants included Martine Ouellet, Raymond Bachand (PLQ, re-elected in Outremont) and Gérard Deltell (Coalition Avenir Québec, re-elected in Chauveau). On this occasion, Ouellet emphasized her party’s platform, which she had been hawking on the campaign trail:

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Quebec Mineral Exploration Association (AEMQ) calls on Quebec to play by the rules – by Marilyn Scales (Canadian Mining Journal – October 30, 2012)

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Concern is mounting within the industry as the Quebec government mulls a ban on uranium exploration. This news is creating uncertainty in Quebec’s mining industry, particularly with respect to Strateco Resources’ Matoush project in the Otish Mountains roughly 200 km from Chibougamau and Mistissini.

Strateco has been working at Matoush since 2006, and says it is considered one of the highest grade uranium projects in the world. At Dec. 31, 2011, the deposit had an indicated resource of 453,000 tonnes grading 0.78% U3O8, containing 7.78 million lb of yellowcake. There is also an inferred resource of 2.04 million tonnes grading 0.43% U3O8 and containing 19.22 million lb of U3O8 using a cut-off grade of 0.10%.

Between 2008 and 2012, Strateco conducted rigorous studies into the impact of the Matoush project, which have been independently monitored and verified. Following these studies, the Canadian Nuclear Safety Commission (CNSC) approved an underground exploration program at Matoush earlier this month. The licence is valid until Oct. 31, 2017.

The alarm is being raised by the Quebec Mineral Exploration Association (AEQM).

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