Black clouds over Plan Nord

PQ calls for revision of mining royalty regime

By Alain Castonguay

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:

• The PQ wants to establish royalties of five per cent on the gross value of ore output, while increasing mining companies’ taxes on “supra-competitive profits.” Ouellet hammered home the oft-repeated argument that “only 10 out of 19 mining companies paid royalties in 2011.” She cited the example of the Lac Bloom iron mine operated by Cliffs Natural Resources in Côte-Nord, “which produced three million tonnes of iron ore without paying a single penny to the government.” The PQ royalties system would be based on a “hybrid model” like the one used in Australia. She added that 25 countries have already begun revising their royalty regimes on the heels of increases in metal prices in 2009.

• Before granting any new mining leases, the PQ will ask operators for firm commitments on primary and secondary processing of extracted ore or metals in the province. Ouellet harshly criticized Stornoway’s decision not to process diamonds from the Renard mine in Quebec.

• At the same time, Premier Pauline Marois has been floating the idea of tax credits for miners that transform their products in the province.

• Operators will have to pick up the tab for all infrastructure projects (roads, harbour facilities, railways, energy) related to Plan Nord mines. New mines will not automatically benefit from Rate L, the preferential rate that Hydro-Québec offers major customers in the industrial sector.

• The Charest government recently granted municipalities and regional county municipalities the right to exclude urban zones and holiday destination lands from exploration for 20 years to curb exploration or development. The PQ will not make changes in this regard.

• The PQ government will require a hearing before Quebec’s environmental public consultation agency BAPE (Bureau d’audiences publiques sur l’environnement) before issuance of a mining lease anywhere in Quebec. This was the stated intention of the Liberal government as well.

• The conservation plan, which includes provisions for protecting 50 per cent of Plan Nord territory, will be more carefully defined in order to avoid creating “rollaway parks” with boundaries that change as knowledge of the area’s resources evolves. The primary criterion will be the level of social acceptance in affected communities once protected areas are established.

• The PQ government will maintain a moratorium on development of shale gas until testing of hydraulic fracking techniques is completed. Ouellet also denounced the agreement between Hydro-Québec and oil exploration companies concerning Anticosti Island. The PQ hopes to reduce Quebec’s oil dependence through policies to electrify public transportation, while promoting renewable energy sources. These policies will be subject to public consultation.

• The PQ will reinforce government intervention in projects involving development of resources on Plan Nord lands. In its platform, the Marois government adds that it intends to “foster full involvement of First Nations, the Inuit, and other northern peoples in the region’s development projects.”

Translated by Mark Stout

PLQ loses experienced MNAs

The PLQ, now the official opposition party, lost several elected officials who were well-acquainted with all aspects of natural resource, mining, energy, and forestry development. Moreover, the PLQ was wiped off the map in Abitibi-Témiscamingue, Saguenay-Lac-Saint-Jean, and Gaspésie, and still has no MP in Côte-Nord.

Clément Gignac, the Charest government’s minister of natural resources and wildlife (MRNF) and minister responsible for Plan Nord, was unsuccessful in seeking re-election in his Taschereau riding. His predecessor at MRNF, Nathalie Normandeau, who was at the centre of the pomp and circumstance surrounding the May 2011 inauguration of Plan Nord in Quebec City, left politics in September 2011.

Another former MRNF minister and still a PLQ candidate, Pierre Corbeil, was not re-elected in the Abitibi-Est riding. MNA Daniel Bernard, a geologist and former president of the Quebec Mineral Exploration Association, did not run in the Rouyn-Noranda-Témiscamingue riding, yet another electoral district lost by the PLQ. In the Dubuc riding, Serge Simard, former vice-minister for natural resources and wildlife, was also unseated by a PQ candidate.

In this case, it was the reeve of the regional county municipality of Fjord-du-Saguenay, Jean-Marie Claveau, who became the new MP for Dubuc.

Claveau sought to collect mining royalties directly from Ressources d’Arianne Inc. for its phosphorus mine project in Lac à Paul. Former PLQ minister of finance Raymond Bachand rejected that request, stating that natural resources “belong to all Quebecers” and not simply to the residents of one MRC (Municipalité Régionale de Comté), and that the royalty system is in need of revision.

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