TORONTO (miningweekly.com) – Canadian drill equipment and services provider Major Drilling on Wednesday campaigned against a possible change in Quebec’s mining regime, saying decisions to be made after a Québec-government forum on Friday would have a significant impact on the future of the mining industry.
Quebec’s Parti Québécois will on Friday hold a forum to discuss how to change the province’s mining regime, owing to its belief that residents had not historically benefited from the province's mineral wealth. The incumbent party campaigned to increase royalty revenues by C$388-million over five years, while reassuring mining producers that the province was still a good place to invest.
The province’s mining industry was already facing an uncertain future as diversified miner Cliffs Natural Resources on Tuesday announced it would idle its Wabush Pointe Noire plant by the end of the second quarter, to reduce costs as iron-ore prices remained weak, and the Canadian National Railway in February shelved a feasibility study for the construction of a proposed C$5-billion rail line and terminal handling facility to serve the Quebec/Labrador iron-ore range, owing to current market realities forcing project developers to defer expected project start-ups.
Major Drilling, which last week posted an expected C$4.3-million third-quarter loss, mainly owing to its senior customers deferring projects, said Quebec's mining industry is one of the driving forces of the regional economy. The company was not opposed to the payment of royalties, “provided they allow a form of mineral resource development that is profitable and economically acceptable”.
The company highlighted the critical contribution made by the mining industry to the province’s economy. “When a mining company invests in Quebec, billions of dollars are awarded in the form of contracts in all regions, helping to create or maintain an incalculable number of direct and indirect jobs.
The New Brunswick-based company’s Eastern Canada division, which petitioned on behalf of 400 employees, and the Bradley Nuvumiut unit, petitioning on behalf of more than 50 workers, said they believed it was critical to mobilise and to make known the views of around 40 000 people whose livelihoods depended on the mining industry in Quebec.
“In our view, the mining tax regime should promote both mining investment in Quebec and the creation of a stable revenue stream for the Quebec government,” the company said.