Evidence of meeting #3 for Natural Resources in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was project.
A video is available from Parliament.
Claude Guay Liberal LaSalle—Émard—Verdun, QC
Thank you, Mr. Chair.
Thank you to all the witnesses for being here today and for responding to our invitation in such a short time, disrupting their business programs.
Ms. Riley and Ms. Valence, my question is mainly for you. You have real projects in the territories. All the committee members want to know about the obstacles you face. We want to know how the committee and the government can help you. I'd like each of you to tell us about the obstacles you face.
How could we help you?
CEO and Managing Director, Vital Metals
Thank you for your question.
I think the first challenge is infrastructure. My project is in the Northwest Territories. We had a rail service that reached as far as Hay River at Great Slave Lake, but it was damaged by the 2023 fires. The problem is that Canadian National Railway doesn't want to fix the line. That makes it impossible for us to transport our materials across the lake on our barges and put them directly on the rails. It's an important piece of infrastructure. The cost isn't even that high. I think it's $15 million.
The second challenge has to do with our government contacts. They're very open to talking to us and helping us find solutions, but I think the big concern is that they're trying to fit problems into boxes. It has to correspond to a box, or it doesn't work. That's one of the issues we're having.
You go into the critical minerals infrastructure fund. If you're not in the critical minerals infrastructure fund, then you go into the strategic innovation fund. If you don't go into the strategic innovation fund, well too bad for you, good luck.
That's more or less it.
I think that there are lots of complexities that come into the funding requirements. From our point of view, in terms of the rare earths in particular, we have some very key issues that need to be addressed in terms of the processing, in terms of collaboration, which is exactly why we came up with this consortium.
The thing is that rare earths are an essential opportunity for Canada to have a seat at the global table, where we would produce a lot more than we would use. We need to take this opportunity. The market is just starting to turn now. This is an opportunity. We don't want to miss the boat, as Mr. Martel said, in the lithium space. There's a time and a place for everything, and rare earths are today.
I pass it to Madam Valence.
Vice President, Sustainability and Government Affairs, Commerce Resources Corp.
Thank you, Ms. Riley.
Infrastructure is indeed an important issue. If we draw a parallel with the Commerce Resources Corp. project in Nunavik, everyone can agree that we're somewhat limited in terms of infrastructure at the 55th parallel.
I think that co-operation is really where things get complicated. A project such as the one undertaken by Commerce Resources Corp. can't single-handedly support all the infrastructure needed to develop northern Quebec. Everyone agrees that, whatever infrastructure is developed, it will benefit everyone.
Earlier, Mr. Simard brought up lithium projects in James Bay. I was involved in one of those projects a few years ago. Some projects benefit particularly from the North Road, which Mr. Simard is very familiar with. It's easy to get on the North Road, follow it down then find another route to go south. In contrast, other projects are further away. Every project lead is individually knocking on every single door of every level of government to ask for the same thing. We're asking the provincial and federal governments how we could find ways to build infrastructure that would benefit all parties and accelerate the integration of the project itself into the supply chain.
Then nothing happens. No one is really taking the lead to bring all the businesses together, to bring them to the same table. We have a territory that needs to be developed to meet critical mineral needs, and we know that this will create community vitality and develop the region's economy. No one is asking how we can bring everyone together to define this region together.
Everyone may well go and see the various levels of government, but we don't necessarily get an answer. There are often various programs, such as Ms. Riley's, but we as mineral developers do our in-depth studies to understand what the best scenario is for us. We still don't know the scenarios of others and who can take the ball and run with it.
Liberal
President and CEO, Corem
The challenge with project development is largely related to the technological aspect.
For certain minerals like iron or gold, where the processes are better known, we have to get to the pilot stage, but not necessarily the demonstration stage.
When it comes to rare earths, the technologies are largely controlled or developed by China. There's also development going on in Germany and Europe, so we have to work on that quickly.
Bloc
Mario Simard Bloc Jonquière, QC
Thank you, Mr. Chair.
Thank you, ladies, and thank you, Mr. Fournier.
I note that the committee has had some discussions in the past. I won't belabour the infrastructure issue, but since time is limited, I still invite you to table a document with the committee to enlighten the analysts. I won't sell you my corridor idea either; I'll do that later.
I think the idea of a consortium is very interesting. I'm not an expert, but our discussions have given me a better understanding of how the deployment of rare earths involves a complex and risky industrial process. Not everyone is willing to commit to that.
That said, what can be done to get the consortium project off the ground? We talked earlier about government programs for indigenous people, in particular. I don't know if that applies to you and your businesses. You can let me know. I don't want to be crude, but what tool does the federal government have that will get a project like this off the ground?
CEO and Managing Director, Vital Metals
As Ms. Valence said, we don't know anyone on the federal side who is picking up the ball to help us get funding to advance our consortium project. Unfortunately, we don't meet the criteria of the existing programs, so we're wondering how we could find a framework adapted to our reality.
Bloc
CEO and Managing Director, Vital Metals
We were never offered that opportunity. We knocked on every door, but we were never given an offer to do that.
Bloc
Mario Simard Bloc Jonquière, QC
Let's say that, tomorrow morning, the consortium is in place at two drop-off points: one in Quebec, the other in Alberta, for example. How would that increase the potential for rare earth projects to emerge? Would that enable you to take it to the next level?
CEO and Managing Director, Vital Metals
Yes, absolutely.
If there are two commercial hubs, as you say, all the other projects will fit together. Those companies would just be producing a concentrate; it wouldn't be hydrometallurgy. I'm sorry to get into the details, but hydrometallurgy is a central second step that can be a $600 million investment for a single company. Centralization would enable businesses to significantly reduce their investment. That way, it would be cheaper for them, and it would go much faster.
We already have the pilot project. We can offer that to any other company that wants to get into rare earth production in Canada. A company could use our pilot project. That would speed things up to the production phase.
Bloc
Mario Simard Bloc Jonquière, QC
The consortium plays a role as an accelerator, then, in the deployment of rare earths. I know that both of you ladies are involved in this.
Torngat Metals is also interested in taking part in the project. Even though that company isn't here today, I don't think I'm revealing any secrets by saying that. Although I don't have your knowledge, it seems that all the players in the rare earth sector are on board with speeding things up. When it comes to rare earths, it's a known fact that Canada is entirely dependent on China for an easily explained strategic reason.
Bloc
Mario Simard Bloc Jonquière, QC
If we don't have that, I assume you'll be operating in silos, each on your own.
Without being able to tell the future, how much time could be saved by creating the consortium? Would it be five, six years?
CEO and Managing Director, Vital Metals
Yes, I believe it would be a minimum of five years.
Bloc
Mario Simard Bloc Jonquière, QC
I know you've lobbied the federal government. So far, the fact has been that the project doesn't fit into the current natural resources programs for funding and for research and development.
Vice President, Sustainability and Government Affairs, Commerce Resources Corp.
That's why we acted as representatives and portfolio holders. That's why we got our bindles ready to tour the federal departments. I think we've met with almost all of them. Overall, they found the initiative interesting and redirected us to various programs.
Given the nature of critical minerals, this is a good time to present our project. It can disappear quickly.
That was the case with lithium, for example. About four years ago, that was the flavour of the month. I think everyone would agree with that. Significant investments were made, but a fairly significant drop in prices means that the sector now sort of finds itself on its back, if I may put it that way.
That sparked the idea of a consortium, which would enable us to act together. Of course, that requires a lot of investment. Again, metallurgical studies are under way, particularly at Commerce Resources. We'll be making progress on that front as well. Everyone with rare earth projects will have to conduct studies on processes, so we're all going to be knocking on the same doors again to get the same money from the same envelope.
Our project is innovative. It's based on outside-the-box thinking, which we should all be doing collectively as well. That's why we've approached the various departments to see if there's a way to create a portfolio dedicated to the consortium to encompass all innovation, research and development with the pilot testing.
That would then enable us to get together and be able to move forward.
Liberal
The Chair Liberal Terry Duguid
Thank you for that exchange.
Colleagues, we're going to go on to our second round.
If it is the will of the committee and the members who are in slots four and five, I'm going to suggest the last three speakers, Mr. Simard, Mr. Rowe and Mr. Hogan, have two and a half minutes each. We have an in camera item to deal with, and we need to take a little pause in order to go in camera. I wonder if that would be acceptable to committee members.
Bloc
Mario Simard Bloc Jonquière, QC
I have nothing against that, but I think we also have to give the witnesses a chance to table briefs or comments with the committee, if they'd like to do so, because this is a complex matter.
Liberal
The Chair Liberal Terry Duguid
Yes, and all witnesses are invited to submit briefs, even those witnesses we will not be able to hear from.
Thank you very much for that, Mr. Simard.
We're on to Mr. Malette.