On May 29, 2013, the Quebec Minister of Natural Resources tabled Bill 43 containing proposed amendments to the Mining Act (“Bill 43”).
The government is using Bill 43 to introduce new concepts into Quebec’s mining regime. Bill 43 brings substantial changes to the rules governing the receipt and renewal of claims and mining leases. It also changes the obligations of holders of claims and mining leases with respect to the rehabilitation and restoration of mining sites while increasing the powers of the Minister of Natural Resources.
Bill 43 draws upon several elements that were proposed in Bill 14 of May 12 2011 (“Bill 14”), notably:
- The obligation of mining claims owners to disclose their intentions to the municipalities and to the owners of the site as well as to produce an annual operations plan;
- The increase of the Minister’s power to enable her to act in the public interest by refusing to grant or to renew a lease for the surface mining of mineral substances or by terminating such a lease;
- The reiteration of the Minister’s obligation to specifically consult Aboriginal communities; and
- The increase of the financial guarantee that must be provided with respect to the rehabilitation and the restoration of a mining site.
Bill 14 was analyzed in our Bulletin of May 26 2011.
Although Bill 43 draws upon measures that were previously contained in Bill 14, it proposes other important amendments to the Mining Act.
Certificate of Authorization: From now on, the certificate of authorization provided for in the Environmental Quality Act, must be obtained before a mining lease can be granted. In addition, the mining site rehabilitation and restoration plan will have to be approved and registered in the public register of real and immovable mining rights.
Feasibility Study: In addition to the certificate of authorization, a feasibility study of the project and of the mineral processing must accompany any request for renewal of a lease.
Follow-Up Committee: Within 30 days of receiving a lease, the tenant will be under obligation to constitute an economic spinoff monitoring and maximization committee. The committee will monitor the works stemming from the mining lease so as to maximize employment, contracts and other economic benefits for the local communities. The committee will remain active until the prior-approved rehabilitation and restoration work has been completed.
Environmental Assessment and Public Consultation: the construction and operation of a mineral processing plant are now subject, regardless of the product and the project’s capacity, to an environmental assessment. In addition, after requesting a lease, the petitioner must submit to a public consultation hearing in the area concerned. This hearing will be conducted by the Bureau d’audience publiques sur l’environement and the Minister may make the lease contingent on conditions she deems necessary to avoid any conflict raised during the public hearing.
Subject to the Mining Tax Act: In order to renew a mining lease, the tenant will have be in conformity with the provisions of the Mining Tax Act especially as they pertain to the payment of royalties to the government.
Notice to the Municipality: The holder of a claim must inform the municipality and the owner of the property within 60 days following the registration of the claim. In addition, it must inform the municipality of the work that it wishes to undertake 90 days prior to their start date. The claim holder must also submit annual reports of the work that has been executed, as described above, to the relevant municipalities.
Exploration Reports: Claims holders will have to submit, on the anniversary of the day their claim was granted, a report to the Minister concerning all the exploration work conducted during the preceding year. They will also, when filing a staking or map designation notice, attach a plan of the work to be undertaken in the coming year. In addition the lifespan of the work credits will be limited to 12 years.
Uranium Discovery or Prospecting: If the Bill is passed it will impose new obligations with respect to uranium prospecting and discovery. A claim holder will have to inform the Minister of any discovery of a mineral substance containing 0.05% or more uranium within 60 days of such discovery. In this case it will have to conform to any additional security measure that the Minister may impose. All prospecting for minerals containing uranium, must be authorized by the Minister and a hydrogeological study will have to be submitted to the Minister prior to a request for authorization.
Information to be Provided: From now on holders of mining rights will have to provide more information regarding processing. On the anniversary of the date on which the lease or the mining concession was granted, they will have to submit a report indicating the quantity and the value of the minerals extracted during the year. They will also have to forward to the Minister any agreement entered into with a community. The Minister will make this information available to the public.
Powers of the Municipality: The Bill empowers municipalities to designate areas that they deem to be incompatible with mining activity or determine the conditions to which these activities will be subject. Incompatible territories are defined as those that would be compromised by the effects of the mining activity.
Expropriation: From now on, expropriation rights will be reserved to the holders of mining rights that wish to proceed to the mining stage. In any other case they must obtain written authorization to obtain access to a lot or acquire it piece by piece. However, when it intends to acquire a residential building, a holder of mining rights must provide financial support to the owner up to an amount of 10% of the building’s market value. In no event can the holder of a mining right relocate or destroy the building before receiving a mining lease.
Auction: The Minister will now have the option to reserve certain claims for public auction. The Minister will establish mineralization indices and the targeted areas for this public auction so as to establish anti-collusion mechanisms.
Financial Guarantee: The financial guarantees that accompany the rehabilitation and restoration plan contained in Bill 14 have been revived. On this topic we refer you to the article published on February 21 2013 entitled: “Quebec tightens rules on financial guarantee requirements for rehabilitation and restoration plans” on Dentons Canada’s “Securities Mining Blog”.
In brief, Bill 43 not only draws upon many amendments previously tabled in Bill 14 but introduces new, more stringent ones notably with respect to the holder of mining claims and the granting of greater powers to municipalities and citizens to express their opinions on mining projects. That said, it is still in bill form with a projected adoption for the fall of 2013. It should be emphasized as well that since 2012 two bills amending the Mining Act have been tabled but have never been passed by the National Assembly. Once again, opposition members, industry experts and other stakeholders are at odds with respect to several amendments contained in Bill 43. We will follow the evolution of this Bill over the coming months.