The Quebec government has recently announced that the Capital Mines Hydrocarbon fund (CMH Fund), the purpose of which is to acquire equity interests in mining and hydrocarbon projects in Quebec, is officially in effect. The creation of the CMH Fund was initially put forward in connection with the 2012–2013 budget by the Quebec government as part of its plan to develop the northern region of Quebec.  

The Quebec government first launched its sustainable development project for the North in 2011. The project contemplated public and private investments of C$80-billion over 25 years and was touted to become one of the largest economic, environmental and social projects in Quebec's history (Plan Nord). Plan Nord was presented as a long-term program aimed at developing Quebec's territory located north of the 49th parallel and north of the St. Lawrence River, covering roughly 1.2 million km2, which comprises nearly 72 per cent of the territory of Quebec. In addition to having one of the largest freshwater reserves in the world, the Plan Nord territory is particularly rich in minerals such as nickel, apatite, cobalt, lithium, vanadium, diamonds, graphite, platinum group minerals, zinc, iron ore and gold. However, after the election of a new minority government in September 2012, the implementation of Plan Nord was first suspended and then revised.


On April 8, 2015, the Quebec government reaffirmed its will to engage in the development of northern Quebec under a reconfigured Plan Nord that seeks to better reflect current economic realities, as well as a heightened sensitivity to social and environmental impacts. According to the government, this remodeled Plan Nord promises to generate investments of C$22-billion over five years and is expected to create nearly 10,000 new jobs in the province. It also provides for public and private investment of C$50-billion over a period of 20 years, of which C$22-billion will be public funds provided by Hydro-Québec and the government, with the remaining C$28-billion expected to come from private investments.

Moreover, the government has recently reiterated its vision to support and stimulate economic development, namely by:

  • ​Granting a general certificate of authorization to Nemaska Lithium for the development and operation of a significant spodumene deposit (for lithium processing) in Nemaska, near Chibougamau
  • Making a significant investment in a diamond project in James Bay (Stornoway Renard Diamond Mine)


On November 7, 2014, the Quebec government announced its intention to implement a new energy policy in Quebec. Following this announcement, a public consultation period was held between February 6, 2015 and July 15, 2015, in order to highlight the key energy challenges that Quebec is facing. According to the government, its new energy policy, which will be presented this fall, will enable Quebec to responsibly develop all of its resources and its shared energy heritage, among other things. 

Although the current state of knowledge makes it difficult to accurately assess the amount of exploitable hydrocarbons in Quebec's subsoil, the theoretical potential could be significant. For instance, the sedimentary basins of southern Quebec or the St. Lawrence Gulf territory (especially the Old Harry Site), the Gaspé and Anticosti Island all appear to have important oil and/or gas potential, including shale gas. 

In recent years, the Quebec government has granted several exploration licences as well as petroleum production test licences in the Gaspé and on Anticosti Island. In September 2015, Ressources Québec, a subsidiary of Investissement Québec, confirmed its intention to make an equity investment of C$3.8-million in Pétrolia, an oil and gas exploration company, as part of its Bourque Project in the Gaspé, bringing its shareholdings in Pétrolia to just below 20 per cent. In July 2015, Ressources Québec also invested nearly C$5-million in order to finance the operation of the Galt Property in the Gaspé being developed by Junex. Further, in August of this year, the Quebec government approved the construction and operation by Stolt LNGaz of a natural gas liquefaction plant in Bécancour, representing an investment of approximately C$800-million. 


According to the Quebec government, the CMH Fund comes into effect as part of the relaunch of Plan Nord and is indicative of the government's support for mining activities, namely through the expansion of export credits and the postponing of the planned increase for the cost of mining claims. 


The main purpose of the CMH Fund, managed by Ressources Québec, is to acquire equity interests on behalf of the Quebec government in companies that extract mineral substances in Quebec.

Available Capitalization 

The government has allocated C$1-billion to the CMH Fund, of which C$500-million will be allocated to projects located north of the 49th parallel, while the other C$500-million will be for projects undertaken throughout the province. A maximum of C$800-million will be exclusively reserved for mining projects, C$200-million of which is intended for pre-feasibility and feasibility studies, and a minimum of C$200-million will be exclusively reserved for hydrocarbon projects.


In order to qualify for funding by the CMH Fund, a project must have a minimum value of C$5-million and be located in Quebec. In the mining sector, a preliminary economic evaluation in accordance with the standards in force in Quebec must have been performed on the project. Once this threshold requirement has been fulfilled, the following projects are eligible:

  • ​Development work at the process stage where mineral resources are indicated and measured
  • Pre-feasibility studies consisting of a comprehensive analysis of the viability of a mining project, which is at the stage where the method of extraction or configuration of the mine has been established, an effective method for treating the ore has been determined, and a financial analysis is being carried out based on reasonable assumptions regarding technical components, engineering data, operational aspects and legal, economic, social and environmental factors
  • Feasibility studies that have a comprehensive analysis of a deposit in which all relevant factors, including geological factors and the other factors mentioned above are reviewed in order to assess the investment required for mining production
  • Preparation and development work for a mining complex
  • Primary transformation or extractive metallurgy work carried out by a company in Quebec, provided that the mineral substances (as defined in the Mining Act) being processed were first mined by the same company or an affiliated company

Hydrocarbon projects eligible for funding by the CMH Fund include pre-discovery and post-discovery works allowing for the determination of potential hydrocarbon targets, the defining of petrophysical, petrochemical and geomechanical parameters, the drilling of exploratory wells, the conducting of extraction tests or the defining of the structure of a deposit. In particular, the following work is eligible:

  • ​The economic evaluation of deposits, consisting of a comprehensive study of a deposit through a sufficiently detailed analysis of its geological features and of engineering and economic factors in order to reasonably demonstrate the presence of substances that are exploitable in an economically profitable manner
  • The development and planning of a deposit with the view to obtaining an operating lease, comprising of a comprehensive study of the viability of an oil or gas project that is at the stage where the extraction and deployment method has been determined and where the availability of recoverable reserves has been confirmed

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