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Quebec proposes law to make mining firms accountable to local community

Quebec Natural Resources minister Martine Ouellet, gestures as she responds to media after presenting a plan to raise mining royalties, Monday May 6, 2013 at Quebec legislature.


The Quebec government is preparing to table a Mining Act that will require companies to be socially and environmentally accountable to the local communities they operate in while being closely monitored to ensure the rules will be followed.

"The Mining Act will consolidate stability and predictability for citizens and for mining companies so that they know what environmental steps they need to follow," Minister of Natural Resources Martine Ouellet said in interview on Wednesday. "I believe the majority of mining companies are willing to comply."

The bill, which will be tabled in the coming days, is the third and final stage of the Parti Québécois's plan to stake its claim over the former Liberal government's Northern development plan called Plan Nord.

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This week, the PQ announced its mining royalties regimes, and Premier Pauline Marois unveiled her government's version of northern development called The North For All. She promised to invest nearly the same amount as the Liberals had committed, but under slightly different rules. For instance, a Secretariat for Northern Development will be created to oversee multimillion-dollar infrastructure projects, such as roads, ports, airports and even railway lines, which will come under strict integrity laws to avoid corruption.

The Mining Act will complete the picture, changing the way companies interact with local and aboriginal communities on projects. The bill will require mining companies to evaluate their mines' economic impact on northern communities. Compliance with the economic impact studies will be monitored by a permanent local committee that will also oversee the environmental effects of each project.

The objective will be to ensure economic and social stability for Northern Quebec communities, Ms. Ouellet said. "We want to avoid having workers flown in and flown out of communities. The fly-in, fly-out system is fine for isolated mines. But for others we want to make sure communities benefit from the opening of a new mine."

She said she wants to expand on the notion of guaranteed local development one step further by eventually imposing on each mine the creation of an economic diversification fund to ensure long-term stability for communities. "You don't start thinking about diversification the day the mine closes, because one day it will close. You have to begin thinking about it on the day it opens," Ms. Ouellet said.

The bill will also require mining companies to set up a special fund within the first two years of operation to cover the restoration costs of the site after the mine closes.

Each mining project will be subject to a public environmental consultation process, unlike the current law, which imposes hearings only on open-pit mines.

A committee made up of mining companies, municipalities and citizen groups has recommended that the bill allow for local governments to define "zones of exclusion" where mining activity will be prohibited. "We will clearly define in the bill how this will work," she said.

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Certain high-stake claims will be sold at auction to the highest bidder rather than on the current first-come, first-served basis. The bill will also prohibit expropriation of properties at the exploration stage of a project, but it will be permitted to allow the mine to go into operation. However, the minister said the mining company will be required to adequately compensate residents and pay for whatever support they require during the expropriation.

Ms. Ouellet said some mining companies, such as Osisko in the Abitibi region community of Malartic, voluntarily paid for all expropriation costs, but now such practices will become mandatory.

"This is an important revision of the Mining Act. It will create a level of social and environmental predictability for mining companies because the tools for people to talk and consult one another will be created."

It was estimated that mining companies paid about $1-million to lobbying firms to try to convince the PQ government to back down on an election promise to more than double mining royalties and taxes. Instead, the PQ announced this week a minimum mining tax on all mines as well as a surtax on profits. Under the regime, companies will have to pay the higher of the two taxes. Depending on profits and output, the new regime will require companies to pay between 15 and 30 per cent more than what they now pay.

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