SOQUEM back in the Abitibi area with plans to stimulate exploration

The Quebec government’s mining exploration company SOQUEM (Societe Quebecoise d’Exploration Miniere) has returned in force to the Abitibi region five years after its departure from the heart of the province’s mining area.

The Crown corporation re-opened its exploration office last April in Val d’Or. SOQUEM’s office in Val d’Or was closed in 1986, in the partial privatization move that led to the creation of Val d’Or-based Cambior (TSE), which is owned 20% by SOQUEM. At the time, the government decided that SOQUEM would not be a player in the Abitibi area, but that restriction was lifted in 1989.

In opening the Val d’Or office, Mines, Energy, and Resources Minister Lise Bacon said SOQUEM can play a vital role in stimulating mining exploration in the Abitibi and in attracting new partners. She said SOQUEM should not be perceived by junior companies as a competitor, but as a potential partner. “We’re trying to cultivate the idea of promoting SOQUEM as a partner (in joint-venture projects),” said SOQUEM interim president and director general Yves Harvey in an interview. Doing so, he continued, will require “just a bit of fine tuning” in people’s perception of SOQUEM.

Harvey, 41, a former SOQUEM vice-president, was thrust into the interim president’s chair after the sudden death by heart attack in March of the corporation’s 3-year president, Andre Laurin.

Founded in 1965 to increase Quebec’s presence in mining, SOQUEM was modelled after similar state agencies in France, Sweden, Finland and Japan. Its goals are to conduct mining exploration by all methods and to carry out prospecting, development, mining and conversion of mineral substances. According to SOQUEM figures, government funding of $104 million over the years has generated exploration expenditures worth about $290 million, creating more than 1,000 full-time jobs and substantial economic spinoffs. “We have a positive track record,” Harvey said. “The financial situation of SOQUEM is very healthy. And it should stay that way.”

Some $2.2 million of SOQUEM’s budget has been set aside for exploration of properties in the Abitibi. And as of the end of March, SOQUEM had invested $900,000 in the research and the acquisition of new properties in the Abitibi. Since SOQUEM has returned to the region, 1,483 claims have been acquired covering 25,984 hectares, of which 605 claims have been staked. Of 14 ongoing projects, six are joint ventures with the private sector, with SOQUEM assuming initial exploration costs.

Harvey is optimistic about a new joint SOQUEM-Ministry of Mines, Energy and Resources program announced in the May provincial budget. Addressed to junior companies, and aimed at maintaining a minimal level of exploration, the program will inject an additional $5 million to SOQUEM’s operating budget of $6.5 million.

To be administered by SOQUEM, the goal of the program is to give some financial support to junior-mining exploration companies that are having extreme difficulty obtaining adequate financing for their ex-ploration projects. The 1-year program applies to all junior companies that have conducted a minimum of $300,000 worth of exploration work since 1988. However, the Quebec Prospectors Association has criticized the program, saying it is not nearly enough. Junior exploration firms in Quebec face major problems, which translate to exploration levels well below what experts say is the minimum needed to maintain production levels.

With the reduction of reserves, and the dearth of exploration — only $45 million was invested in exploration in Quebec last year — SOQUEM’s role is becoming more and more justified, said Harvey, who maintains a bright outlook for the future despite the current bleak situation.

Along with its new Val d’Or office, SOQUEM, which has 33 employees on its payroll, has a regional office in Chibougamau and a head office in Ste-Foy, a suburb of Quebec City.

Daniel Kucharsky is a freelance writer from Montreal.