Rare Earth Mining in Quebec

Quebec is the largest province in Canada and also hosts the second-largest population in the country. It boasts a strong and diversified economy that ranks among the most important in the world, and as a mining location it is becoming increasingly appealing to the exploration and investment communities.

The reasons behind Quebec’s attractiveness include its strategic location, abundant resources, and highly-educated and skilled workforce.

An investor-friendly market environment coupled with 26 underground open-pit mines and over 300 sandpits, quarries, and peat bogs have resulted in the Quebec mining industry thriving over the past decade.

History of mining in the province

According to the Government of Quebec, the history of mining in the province dates back as far as the mid-1500s, when Jacques Cartier thought that he had found diamonds and gold on the slopes of Cap Diamant. However, upon returning to France he discovered that he had in fact found quartz and pyrite.

The first true mines did not open in the area until the 1840s, when several major mineral deposits were identified; the early 1920s marked the period when mining truly became established. The growth of the industry, which coincided with large-scale industrial expansion, quickly made the region an important source of minerals for the most highly-industrialized areas of North America.

Economic and geopolitical conditions

Quebec’s provincial government has gone to great lengths to promote an investor-friendly environment – something that has not gone unnoticed by rare earth element (REE) producers. As part of its aim to expand the sector, Quebec has reformed its mining royalty regime, streamlined laws and regulations, and is taking steps to enhance and create new infrastructure to sustain mining development as a whole.

To ensure the competitiveness of this sector while receiving its fair share of resource development benefits, the provincial government has also reformed the mining duties regime to include support activities aimed at promoting the discovery and future production of mines.

One area of the province’s portfolio that is gaining extra attention is that of REEs. Earlier this month, the Canadian Chamber of Commerce released a report suggesting that Canada’s REE resources could give the nation increased “political leverage and influence.”

The Chamber went on to add that several Canadian mines are showing great potential, before singling out a property currently being evaluated in the Temiscamingue region of Quebec.

Mining and exploration opportunities

Below is a selection of companies exploring for REEs in Quebec.

Montreal-based Matamec Explorations Inc. (TSXV:MAT) is a junior exploration company developing a heavy rare earth deposit at its Zeus property in Southeast Quebec. Most of the Kipawa deposit’s value is in five critical REEs, including dysprosium and terbium, which are indispensable in applications such as green energy and green technology.

Toyota Motor Corp. (TSE:7203) recently entered into a strategic partnership with Matamec in order to fast track the deposit into production. The company is independently exploring the rest of the Zeus property and has identified two zones that show potential for defining new strategic metal resources. Its summer 2012 exploration will be concentrated on these zones.

Quest Rare Minerals Ltd. (TSX:QRM) has stated that its Strange Lake Deposit in Northern Quebec could supply as much as 10 percent of global demand for REEs once it is up and running, and as much as 30 percent of demand for more expensive heavy rare earths.

The property, located 220 km northeast of Schefferville and 125 km west of the Voisey Bay nickel–copper–cobalt mine, covers an area of 54,000 hectares. Exploration is focused around the historic Strange Lake REE deposit and additional anomalous REE showings on the property.

According to a company press release, acid consumptions of approximately 200 kg/ton are being achieved with REE dissolutions in the 90 to 96 percent range, niobium dissolutions in the 93 to 96 percent range, and zirconium dissolutions in the 85 to 93 percent range.

Focus Metals Inc. (TSXV:FMS) is working on fast-tracking the development of the Kwyjibo, Quebec REE and copper property in partnership with SOQUEM, the Quebec government’s commercial mining corporation. Focus and SOQUEM are working on the design of a two-phase follow-up exploration program on the Kwyjibo property for the summer 2012.

GeoMegA Resources Inc. (TSXV:GMA) is focused on its Montviel property, which covers 8,830 hectares and is located near Lebel-sur-Quevillon, Quebec.

In September 2011, it released an initial NI 43-101 compliant resource calculation for the property that estimated 183.9 million indicated tonnes averaging 1.45 percent total rare earth oxide (REO) in addition to 66.7 million inferred tonnes averaging 1.46 percent total REO. It also posted results from its phase two drilling program showing 2 percent total REO over 327 metres and 0.75 percent niobium oxide over 32.9 metres in one of the property’s holes.

Kirrin Resources Inc. (TSXV:KYM) operates two rare earth exploration projects and is also active in corporate development. The company’sGrevet REE property was acquired in 2010 and is located in Northwest Quebec. It encompasses a carbonatite intrusive body and dyke complex and its acquisition was premised on the potential for an open-pit operation.

In October 2011, the company announced assay results from its sampling program. These included a 20.35 percent light rare earth oxide (LREO) with an additional four samples from other showings assaying above 10 percent LREO. According to the company, the results show that elevated REE in carbonatite exists throughout the property and are encouraging in the context of the recessive nature of large carbonatite occurrences.

Securities Disclosure: I, Adam Currie, hold no direct investment interest in any company mentioned in this article.