Photo by: Bloomberg
TORONTO (miningweekly.com) – Junior explorer Strateco Resources has received creditor protection from the Superior Court of Quebec after First Nation opposition to its Matoush uranium project, located on reserve lands in the province’s Otish mountains, had halted the company’s flagship project dead in its tracks.
The court had granted a stay of proceedings under the Companies' Creditors Arrangement Act (CCAA) until July 9, which could be renewed thereafter.
Strateco’s TSX-listed stock was suspended on Tuesday until Friday, when it would be formally delisted from the exchange’s main board.
The Boucherville, Quebec-based firm was embroiled in a bitter dispute with the Quebec government over its refusal to grant the certificate of authorisation needed to proceed with underground exploration at the Matoush project. This had driven away investor interest, rendering the company unable to meet its financial commitments in spite of its cost-reduction measures.
The Matoush project has been on standby for about two years, since a moratorium and commission of inquiry into Quebec's uranium industry was announced on March 28, 2013.
Strateco's main asset now remained its litigious claim against the provincial government, in which Strateco sought up to $190-million in damages to offset the loss of its investment in the Matoush project. Strateco would seek approval for an interim financing that would allow it to continue to prosecute its proceedings for the benefit of all stakeholders, including its creditors and shareholders, within the framework of the CCAA.
The initial court order had postponed the company’s upcoming annual general meeting.
Law firm Stikeman Elliott was representing Strateco at the CCAA proceedings, for which E&Y had been appointed by the court to act as monitor.
Three Strateco directors had also resigned with immediate effect.