Canada: Quebec Makes Another Attempt At Amending The Mining Act

On Thursday, December 5, 2013, Martine Ouellet, the Quebec Minister of Natural Resources, tabled Bill 70, entitled An Act to Amend the Mining Act. The fourth and latest instalment in a long line of attempts to reform Quebec's mining legislation, unlike its predecessor Bill 43, Bill 70 would make amendments to the current Mining Act rather than replace it completely. Interestingly, Bill 70, like Bill 43, contains a preamble that explains the reasons and the objectives upon which the amended Mining Act is based.

What's New?

Bill 70 contains several significant changes to the Quebec legislative mining regime pertaining mainly to the rights and authority of municipalities, increased environmental oversight, public interest considerations, economic benefit measures, consultations requirements with Native communities, and other modifications to the rights and title regime. In this respect, Bill 70 addresses most of the substantive changes proposed in Bill 43, but in a more conciliatory manner, taking into account the interests of various stakeholders, to a certain extent. It should be noted that Bill 70, if adopted, will have no retroactive effect and will therefore apply from the date upon which it comes into force.

In addition, the granting of a mining lease will be subject to the filing or submission of a rehabilitation and restoration plan, together with a market study on the feasibility of mineral processing in Quebec. Metal mining projects with a capacity over 2,000 metric tons per day, other than rare earth minerals, will be subject to a public consultation process before a mining lease is granted by the government. The government may impose conditions regarding the economic benefits of the mining activities for Québec in the lease. In order to enforce these conditions, the lessee will be required to establish and maintain a committee with the local community to supervise their implementation. In connection with the economic benefit conditions, holders of mining rights will be required to provide certain information to the Minister in respect of the quantity of ore extracted, its value, and the duties paid under the Mining Tax Act and other contributions paid to the government of Quebec. This information is made public, except for data or information contained in reports on exploration work, which will be remain confidential for a period of two years.

The power of expropriation for holders of mining rights would be exercisable only during the mining stage, and mining rights holders will be required to provide financial support to owners during negotiations for the purchase of their homes.

Municipalities

Bill 70 proposes granting new rights and authority to municipalities in a similar manner as had been proposed in Bill 43. For instance, under Bill 70, a claim holder would be required to notify a municipality that it had acquired a right on municipal lands and to inform the municipality prior to carrying out work on the claim.

Bill 70 also proposes amending the Act Respecting Land use Planning and Development to allow regional county municipalities to designate portions of their lands as "incompatible" with mining activity or subject to specified conditions. Unlike Bill 43, however, Bill 70 provides that the regional county municipalities would set these conditions and that the Minister would only be allowed to set them to the extent only that the regional county municipalities had not done so. Also in contrast to Bill 43, Bill 70 would not permit the Minister to exempt a holder of mining rights from these conditions.

Similar to Bill 43, the proposed changes under Bill no. 70 would likely apply to land under the jurisdiction of the Cree First Nations governments, which covers more than 300,000 square km in Northern Québec. The Québec government is currently required to notify First Nations governments, on a monthly basis, of the grant of any new mining claims on land below the 55th parallel.

Environmental Considerations

Like Bill 43, Bill 70 provides that mining operators would be required to provide a financial security to the government to cover the entire anticipated cost of rehabilitating and restoring a mining site. This security must be provided at the same time as the mining operators' site rehabilitation and restoration plan and is subject to conditions established by the government through regulations under the Mining Act.

The grant of a mining lease would also be subject to a certificate of authorization under the Environmental Quality Act, as well as the approval of the mining operators' site rehabilitation and restoration plan.

One notable change under Bill 70 is the level of environmental review that a proposed mining project may expect to receive. Under Bill 43, all processing plants and mining projects would have been subject to an environmental assessment. Under Bill 70, however, only those metal mines projects involving a projected daily production of 2,000 metric tonnes or more would be subject to such an assessment. Projects with lower projected daily production would be subject to public consultations coordinated by the project developer.

Public Consultation and Public Interest

Like Bill 43, Bill 70 provides that the grant of any mining lease for surface mineral substances for peat, industrial activity or commercial export would be subject to prior consultation. If adopted, the bill would also allow the Minister to refuse or cancel such a lease for reasons of public interest. Mining claim holders would also have to declare when they are searching for or have found uranium.

Economic Benefits

Similar to Bill 43, Bill 70 contains several proposals aimed at increasing local and regional economic benefits. For instance, mining lease holders would have to create and maintain a follow-up committee to maximize local employment and procurement. The majority of the committee would have to be comprised of independent stakeholders from the region affected by the mining activity. The committee would remain in place until the completion of the lease holder's site rehabilitation and restoration plan.

The application process for a mining lease would be somewhat less burdensome under Bill 70 than what had been proposed under Bill 43. Under Bill 43, a mining operator applying for a mining lease would have had to submit a feasibility study on the possibility of processing the mined minerals in Quebec. Under Bill 70, the applicant would need to provide only a less onerous market study on the feasibility of mineral processing in Quebec. Based on the conclusions of the study, the Minister could require the mining operator to enter into an agreement to ensure maximum economic benefits for Quebec in exchange for the mining lease.

Mining lease holders would also be required to provide detailed information on extraction tonnage and royalty payments in order to comply with recent changes made to the Québec mining tax regime.

First Nations Consultations

In its introductory provisions, Bill 70 incorporates the general obligation to consult with Aboriginals established by the courts with respect to mining activities. In addition, at least one Aboriginal representative must sit on the follow-up committee mentioned above for projects that would affect Native communities. The bill also prohibits the expropriation of aboriginal burial grounds. Unlike Bill 43, Bill 70 would also require the Minister to adopt and publish a specific policy for the consultation of First Nations.

Other Proposed Changes Under Bill 70

The bill also provides for the following:

  • Claim holders would have to report all exploration work carried out with respect to the claim.
  • Work credits would expire after 12 years.
  • Certain information obtained through the application the Mining Act would be rendered public.
  • Fines under the Act's penal provisions would be increased.

Looking Ahead

Although the presentation of Bill 70 in the National Assembly was met with muted reaction by the opposition, the main opposition parties appear to be generally supportive of adopting the bill. While the government would like to see the bill passed before the holiday recess slated to begin next week, the Liberal Party of Quebechas insisted that it would like more time to examine the bill. Whether this means that the current sitting of the government will be extended into the holiday season in order to review and finalize Bill 70 remains to be seen.

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