Miners remain optimistic at the Quebec mining convention

The Quebec Mining Exploration Association or AEMQ has kicked off its four-day annual convention at the Chateau Frontenac in Quebec City.

“It’s the first convention by our members for our members,” says Valérie Fillion, the executive director of the non-profit organization that represents explorers and producers and companies assisting with mining activities in the province. The Quebec Mining Convention runs from Nov. 19-22.  

Formed in 1975, AEMQ currently has 2,000 individual members including prospectors, geologists, brokers, geophysicists, and some 250 corporate members.  

During the morning of Nov. 20, Fillion said about 1,500 delegates have registered, but that “people keep coming and it’s adding up.” She expects the attendance to grow to 2,000.

AEMQ provided a handful of technical and educational workshops on Nov. 18-19, followed by an evening reception on Nov. 19 and a trade show that picked up the morning after, with more than 100 exhibitors.

Some 40 speakers are set to give talks throughout the week covering a range of topics from the diversity of nickel deposits in the world, capital markets to the next generations of Quebec mines, including industry trends and public expectations.

The mayor of Quebec City, Regis Labeaume, who is the convention’s honourary president, also met with exhibitors and attendees on Nov. 20. Labeaume was the president of AEMQ from 1987-1988.

“In view of the challenges that have arisen, this event becomes crucial to the evolution of the development of mineral resources. We all know that last year was eventful for the industry as a whole, to say the least,” he said in a prepared statement. “But today prospectors, geologists, explorers, producers and investors remain confident that Quebec’s mining industry will do its best to remain a world leader in exploration and development.”  

“We are still one of the best places in Canada [for exploration],” adds Fillion.  “We still have stable laws and rules, and we have only explored 15% of our underground potential.”

Despite the uncertainty looming over Quebec’s mining royalties with expected hikes, many companies were quick to highlight the benefits of working in the province.  

Parti Québécois’ promise during the elections to increase taxes “scared a lot more people outside of Quebec than it did inside of Quebec,” says Sylvain Laberge, manager of investor relations for Threegold Resources (THG-V).

Those anticipated hikes didn’t make the timeline for the provincial government’s first budget tabled on Nov. 20. However, it did say it would apply a 5% royalty on all mines, further increasing it to 30% if profits from an operation exceeded a certain amount.

Despite the higher expected tax rates, some companies believe the province remains an attractive mining area.

“The bottom line is for a gold exploration company this is the best jurisdiction in the world,” argues Eagle Hill’s (EAG-V) president and CEO Brad Kitchen, pointing to the tax break the government provides as an incentive for exploration.

“For every dollar we put into the ground we get 35¢ back,” he explains, adding the province also offers mining infrastructure, a skilled pool of workers, and “a clear and defined path to work on.”

Eagle Hill is advancing its high-grade gold Windfall Lake project in the Abitibi belt in northern Quebec, which is estimated to start production in two to three years.

“There’s nothing bad that we have to say about Quebec as a place to develop a mine,” comments Rob Buchanan, the director of investor relations at Royal Nickel Corp. (RNX-T), adding the province offers low cost power and “no surprises” in its permitting process.

The firm is working on completing a feasibility study on its Dumont nickel project in the Abitibi region by mid-2013.