June/July 2011

Plan Nord paves way for development

Ambitious 25-year plan will enhance northern region

By Correy Baldwin

 

Quebec Premier Jean Charest spoke at ArcelorMittal’s mine expansion announcement at the Mont-Wright mining complex | Courtesy of ArcelorMittal


Billed as an economic, social and environmental development plan that will span a generation, the Quebec government’s Plan Nord is giving its mining industry and northern communities a welcome boost.

Northern Quebec, which covers 72 per cent of the province yet accounts for less than two per cent of its population, is sorely lacking in infrastructure, a frustration both to companies hoping to access the region’s plentiful resources and those living in its communities. With Plan Nord, the Quebec government intends to change that.

The plan involves $80 billion in public and private investment in infrastructure – for roads, hydroelectricity and communications – and in community development, including education, housing and health services. The idea is to invigorate the North and its communities through sustainable economic development.

They are already seeing results. On May 20, ArcelorMittal, the world’s largest steel producer, announced a $2.1 billion expansion of its iron ore mine at Mont-Wright. The expansion is expected to increase annual production of iron ore concentrates from 14 million tonnes to 24 million tonnes by 2013. As well, the investment is expected to create 8,000 jobs during the construction phase and 900 once completed.

“We need to have good local conditions to be able to proceed with such an important investment,” said Éric Tétrault, director of communications for ArcelorMittal Canada, “one of which is having a strong partner in building communities, housing, transport infrastructure, manpower training and so on. This is what Plan Nord provides us.”

“This is a fantastic example of a very balanced approach to development,” agreed Matt Manson, CEO of Stornoway Diamond Corporation, whose Renard project, now in the feasibility stage, has the potential to be Quebec’s first diamond mine. “On one hand, the government is making substantial investment in infrastructure development, and on the other hand, they’re doing all of the appropriate biodiversity conservation and social development that makes development genuinely sustainable.”

Open road for development

Stornoway Diamond will benefit from the Route 167 extension, part of the $821 million investment in roads that is part of the Plan’s first phase. “If you’re building a mine on seasonal winter roads, how you operate and the scale of your operation is somewhat limited,” explained Manson. “If you have a two-lane gravel highway, you have much more flexibility in how you build and operate your project.”

“The road allows us now to raise the kind of serious investment required to build our project and to get started with that work,” Manson added. “It’s a catalyst that allows us to make a substantive investment in the construction of our mine.”

Northern lights

Xstrata’s Raglan nickel mine in Nunavik may be too remote to make use of road expansions, said Francis Beauvais, Raglan’s director of communications, but the announcement for hydroelectricity in the area under Plan Nord is welcome news. “Like all communities in the North, we are using diesel power generators,” he explained. “The cost of fuel energy is very expensive. We’ve made several efforts to get connected to a grid, but since we’re so isolated, it was almost impossible.”

“Hydro is good news not just for us,” added Beauvais, “but also for our Inuit partners in the communities that are using diesel fuel to generate electricity. Just imagine what hydro electricity could do for the communities. Once you have hydroelectricity, it is an open door for development.”

Housing and employment training

Metanor Resources is accessing yet another aspect of Plan Nord for its Bachelor Lake gold project. “The employee training program is going to make our search for employees and hiring qualified people easier,” said Pascal Hamelin, general manager of operations. “There are a lot of youth up North, especially in the First Nations communities. They are open to training in mining, and that’s where Plan Nord is going to be a tremendous opportunity for us,” he explained. “We’re already in discussion with Emploi-Québec for training to start at the end of the summer. A lot of the programs up North are already in place.”

Employment is also one of the issues being advanced by Makivik Corporation, a non-profit organization owned by the Inuit of Nunavik, and one of the signatories to Plan Nord.“Nunavik has a very young population,” said Allison Irqumia, Makivik’s assistant project manager. “At least 60 per cent are under the age of 25. Under Plan Nord, hopefully we will see job creation for this demographic.”

Shortage of housing in the region is also a top priority for Makivik. “Housing is a critical issue in Nunavik right now,” explained Irqumia. “Families are living on top of each other and this leads to all sorts of problems; it creates bigger problems.” She is hopeful that their concerns are being addressed. At least 500 new housing units in Nunavik will be built during the first five years of the Plan, as well as renovations to an additional 482.

The response to the Quebec government’s initiative has been positive to date. “Plan Nord constitutes the ideal platform for private investment in the North,” said Beauvais. “It’s easier for the companies to commit when there is also a commitment from the government and the local communities to develop. Some companies are on the verge of making a decision, and if the government is opening the doors for investment and making it easier, it will have a great impact on their decision.”

It is certainly making a difference for ArcelorMittal. “We want to raise our global iron ore concentrate production to 100 million tonnes per year by 2015,” said Tétrault. “To meet this objective, we will have to study many more projects in Quebec, and Plan Nord is certainly one of the conditions helping us in our decisions.”

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