Canada: Mining Rights In The Province Of Quebec

In the Province of Quebec, mining is principally regulated by the provincial government. The Ministère des Ressources Naturelles et de la Faune du Québec (the Ministry of Natural Resources and Wildlife of Quebec, MNRW) is the provincial agency entrusted with the management of mineral substances in Quebec. The ownership and granting of mining titles for mineral substances is primarily governed by the Mining Act (the Act) and related regulations. In Quebec, land surface rights are distinct property from mining rights.

Rights in or over mineral substances in Quebec form part of the domain of the State (the public domain), subject to limited exceptions for privately owned mineral substances. Mining titles for mineral substances within the public domain are granted and managed by the MNRW. The grant of mining rights in privately owned mineral substances is a matter of private negotiations, although certain aspects of the exploration for and mining of such mineral substances are governed by the Act. This article provides a brief overview of the most common mining rights for mineral substances within the domain of the State.

Mineral Substances other than Surface Mineral Substances, Petroleum, Natural Gas and Brine

A claim is the only exploration title for mineral substances (other than surface mineral substances, petroleum, natural gas and brine) currently issued in Quebec. A claim gives its holder the exclusive right to explore for such mineral substances on the land subject to the claim but does not entitle its holder to extract mineral substances, except for sampling and in limited quantities. In order to mine mineral substances, the holder of a claim must obtain a mining lease. The electronic map designation is the most common method of acquiring new claims from the MNRW whereby an applicant makes an online selection of available pre-mapped claims. In rare territories, claims can be obtained by staking. A claim has a term of two years, which is renewable for additional periods of two years, subject to performance of minimum exploration work on the claim and compliance with other requirements set forth by the Act. In certain circumstances, if the work carried out in respect of a claim is insufficient or if no work has been carried out at all, it is possible for the claimholder to comply with the minimum work obligations by using work credits for exploration work conducted on adjacent parcels or by making a payment in lieu of the required work.

Mining leases and mining concessions are extraction (production) mining titles which give their holder the exclusive right to mine mineral substances (other than surface mineral substances, petroleum, natural gas and brine). A mining lease is granted to the holder of one or several claims upon proof of the existence of indicators of the presence of a workable deposit on the area covered by such claims and compliance with other requirements prescribed by the Act. A mining lease has an initial term of 20 years but may be renewed for three additional periods of 10 years each. Under certain conditions, a mining lease may be renewed beyond the three statutory renewal periods.

Mining concessions were issued prior to January 1, 1966. After that date, grants of mining concessions were replaced by grants of mining leases. Although similar in certain respects to mining leases, mining concessions granted broader surface and mining rights and are not limited in time.

Surface Mineral Substances

In order to mine surface mineral substances – peat, sand, gravel, limestone, calcite, etc. – and, save for limited exceptions, an interested person must hold either an exclusive or non-exclusive lease for surface mineral substances (SMS). Leases in respect of SMS are granted upon application to the MNRW and compliance with the requirements prescribed by the Act.

A non-exclusive lease is an annual mining title, effective until March 31 of the year following its issuance and renewable annually. The term of an exclusive lease will depend on the anticipated duration of the activities for which the minerals are mined, but may not exceed 10 years (15 years for peat), renewable for a term not exceeding five years (15 years for peat).

Petroleum, natural gas and underground reservoirs

In order to explore for petroleum, natural gas or underground reservoirs, an interested person must first obtain an exploration licence from the MNRW, which gives an exclusive right to explore for such mineral substances on the territory covered by the licence and during the term thereof. After March 20, 2012, exploration licences will be awarded by auction, the process of which is yet to be announced by the provincial government. Until completion of strategic environmental assessments of sustainable offshore oil and gas development ordered by the provincial government, which should occur by no later than June 13, 2014, all issued licences are temporarily suspended.

For the production of petroleum or natural gas or the operation of an underground reservoir, the interested party must obtain from the MNRW a lease to produce such substances. These mining titles are issued upon proof of the presence of an economically workable deposit or operable underground reservoir and compliance with other requirements prescribed by the Act. The leases have an initial term of 20 years but may be renewed for three additional periods of 10 years each. Under certain conditions, these leases may be renewed beyond the three statutory renewal periods.

Transfers and Grant of Security

The claims, mining leases and concessions, exclusive leases for SMS and the licences and leases for petroleum, natural gas and underground reservoirs obtained from the MNRW may be sold, transferred, hypothecated or otherwise encumbered without the MNRW's consent. However, a release from the MNRW is required for a vendor or a transferee to be released from its obligations and liabilities owing to the MNRW related to the mine rehabilitation and restoration plan associated with the alienated lease or mining concession. Such release can be obtained when a third-party purchaser assumes those obligations as part of a property transfer. For perfection purposes, the transfers of mining titles and grants of hypothecs and other encumbrances in mining rights must be recorded in the register of real and immovable mining rights maintained by the MNRW and other applicable registers.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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