It will be a happy new year for Quebec phosphate development company, Arianne Phosphate (TSXV:DAN). The company was given the green light from Quebec to build its $1.2 billion Lac à Paul phosphate rock project in Quebec’s Saguenay-Lac-Saint-Jean region.
The decree from the Quebec government comes just shy of two months following a favorable independent report by the Bureau d’audience public sur l’environment (BAPE), in which no major objections to the development of the project were raised.
As Arianne’s CEO Jean-Sebastien David said in a company statement, “There could not have been a better way to end the year for Arianne and the region as a whole.”
“The Ministerial Decree represents the most significant milestone to date for the project,” David stated.
And rightly so. With this latest piece of approval, Arianne can get underway with securing the financing for the Lac à Paul project. The company believes that this undertaking will be an integral “step in the process and will assist in facilitating ongoing discussions with potential corporate, strategic and financial partner.”
In October 2013, Arianne completed its feasibility study for the Lac à Paul phosphate project, which outlined an open pit mine, and concentrator producing high quality apatite concentrate. Furthermore, the company would be using its proximity to the deep-water port on the Saguenay River to its advantage for transporting its product year-round.
The company hopes to break ground on mine construction in 2016. Lac à Paul has an anticipated mine life of 25.75 years, with an average annual production rate of 3 million tonnes of phosphate concentrate at a 38.6% P2O5 and an average recovery rate of 90 percent.
Meanwhile, according to the Montreal Gazette, not everyone is happy with the government’s approval. The publication highlights that La Fondation Rivières put forth a request with the cabinet to put off the decision until it had guarantees from Arianne of “compensation in the event of damage to the environment or third parties.”
On the back of the news, Arianne has seen a 3 percent increase in its share price. The company is currently trading at $0.98.
Securities Disclosure: I, Vivien Diniz, hold no investment interest in any of the companies mentioned.