Canada: Fourth Time's The Charm? Quebec Introduces Mining Act Changes Again

On December 5, 2013, in the Québec National Assembly, Martine Ouellet, the Quebec Minister of Natural Resources (MNR) presented Bill 70, which seeks to amend the Quebec Mining Act (Act). Bill 70 comes on the heels of the recent defeat of Bill 43 which sought to replace the existing Act. Bill 70 is the fourth attempt to modify or replace the mining regime in Quebec since 2009. It appears that the government has the support of one of the opposition parties, the Coalition Avenir Québec, and it is therefore expected that Bill 70 will have a good chance of passing. The proposed changes include:

  • Aboriginal Communities: Following criticism that Bill 43 did not sufficiently address specific aboriginal issues, Bill 70 proposes to add a chapter to the Act that deals specifically with aboriginal communities. These provisions provide that the Act must be construed in a manner consistent with the duty to consult and that consideration of aboriginal rights and interests are part of reconciling mining with other uses of the territory. It also provides that the Minister will prepare and keep updated a native community consultation policy for the mining sector.
  • Notices of Claim and Exploration Work: As was provided in Bill 43, within 60 days of registration, claim holders will be required to notify the municipality and the surface rights owner or leaseholder of the fact that they have obtained the claim. Rather than the 90-day period provided for in Bill 43, claim holders will be required to inform the municipality at least 30 days prior to performing work.
  • Measures to Foster Exploration Work: As with Bill 43, excess amounts spent on a claim that can be allocated to renew other claims is reduced from a radius of 4.5 to 3.5 kilometres and the period during which excess amounts may be carried over is limited to 12 years. It will still be possible to make a cash payment in lieu of mandatory exploration work, but the amount of the cash payment will be twice the amount of the outstanding work. Bill 70 also provides that an annual operations plan and an annual report on all work performed must be submitted to the MNR.
  • Closure Plan and Obtaining Environmental Approvals Are Preconditions for Issuance of a Lease: As with Bill 43, the approval of a mine closure plan and the issuance of environmental approvals will be required before a mining lease is issued. It is proposed that the closure plan will be registered in the mining register kept by the MNR for public information purposes. The Minister will also be permitted to add conditions to a lease in order to avoid conflicts with other uses of the territory.
  • Environmental Impact Assessments (EIAs) and Public Consultation Requirements: Bill 70 proposes that EIAs will be required for all mineral processing plant construction and operation projects and all mine development and operation projects, where the processing or production capacity of the plant or the mine is 2,000 tonnes per day or more. However, all rare earth processing projects are to be subject to an EIA process regardless of the processing or production capacity. This is in contrast to the current 7,000 tonnes per day limit that is currently set but is above the threshold set in Bill 43, where no processing or production limits were set.

    For metal mine projects where the mine has a production capacity of less than the 2,000 tonnes per day threshold, a public consultation process must be held before a mining lease may be granted. However, this requirement will not apply to rare earth projects.
  • Scoping and Market Study: A scoping and market study on processing in Quebec must be submitted with the lease application and every 20 years thereafter, as well as before beginning mining operations on any mining concessions and every 20 years thereafter. This will be less costly to prepare than the ore processing feasibility study proposed under the previous Bill 43.
  • Economic Spinoffs and Economic Spinoff Committee: As with Bill 43, Bill 70 proposes that when granting a lease and 20 years after mining activities begin, the government may require that the economic spinoffs within Quebec of mining the mineral resource be maximized. However, Bill 70 now indicates that they may only be required if there are reasonable grounds to do so. The government may also require the lessee to establish and maintain a monitoring committee to foster the involvement of the local community in the project. Holders of mining concessions on which mining operations have not yet commenced will be subject to a similar requirement.
  • Public Information: Similar to Bill 43, documents and information obtained by the Minister from mining rights holders under the Act are considered to be public. The Minister can make these documents and information public in the manner the Minister sees fit. However, data contained in exploration work reports will remain confidential for two years, with the exception of geological, geochemical, geophysical and analytical data.

    The following information must be made public once a year for each lease, concession and surface mineral substances lease: (1) the quantity and value of the ore extracted during the previous year; (2) the royalties paid during the previous year; and (3) the overall contributions paid by the holder. The closure plan and the financial guarantee are also made public.

    However, in contrast with Bill 43, there will no longer be a requirement for community agreements to be made public. In fact, Bill 70 provides specifically that the data contained in an agreement entered into between a mining rights holder and a community is not to be made public and may only be used for statistical purposes.
  • Power to Terminate Sand and Gravel Leases: The Minister may refuse to grant or terminate a sand and gravel lease if it is of the view that it is in the public interest.
  • Expropriation Rights Curbed: It is proposed that the power to expropriate that mining rights holders have under the Act can now only be exercised during the actual mining stage and they will be required to compensate expropriated parties for certain costs of professional services.
  • Increased Fines: Fines for violations of the Act have been increased substantially and, depending on the offence, may reach as high as C$6-million.
  • Powers of Regional County Municipalities: RCMs may declare portions of their territory as a mining-incompatible territory in their land use and development plan. The Minister may within a certain period declare that the designation of a territory as being incompatible is inconsistent with government policy direction that is to be prepared.

Although it is expected that the government will be seeking swift passage of Bill 70, at this stage, it is unclear when it will be passed. We will keep you posted on developments.

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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