Evidence of meeting #5 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 recording is available from Parliament.
Liberal
The Chair Liberal Terry Duguid
Okay.
Mr. Guay has the floor, and then we'll have Mr. Simard for a final two and a half minutes.
Mr. Guay, you have five minutes.
Liberal
Claude Guay Liberal LaSalle—Émard—Verdun, QC
Thank you, Mr. Chair.
My question is for Mr. Desaulniers.
The federal government has limited capacity when it comes to investing funds. It spends taxpayers' money, of course.
Mr. Carney said that he wanted to attract hundreds of billions of dollars in private capital. You spoke about your impressive lineup of shareholders and investors.
I would like to know where federal government or taxpayer money can be invested so that $1 generates $10 in private investment. What should be done, what are the conditions and what are the best places to invest, based on your experience?
Founder, President and Chief Executive Officer, Nouveau Monde Graphite
Last week, for example, I was part of a Quebec government delegation to Japan and Korea, where I also met with our clients. I had some fairly privileged discussions with officials from the department of economy, trade and innovation in order to promote investment in Canada. That's really our focus with Mitsui and Panasonic. All the G7 countries are in a similar situation and need to find alternative sources of supply to China.
To position ourselves as a leader, our best contribution to the G7 countries consists of proposing mining projects that are ready for construction and financing. We can use the necessary tools to mitigate the risks involved in financing these projects and then start the construction. That way, we can sell the quantities of products that our allies need. We can play a leading role in this area.
Right now, in terms of government initiatives, I'm hearing that we must do something other than try to compete with China in the way that it finances projects, meaning with zero‑cost capital. We can't do that in Canada.
We need the right financial tools to secure supplies and enter into offtake agreements and contracts for difference, similar to the mandate obtained by the Canada Growth Fund a little while ago. We must ensure that we understand this mandate and take it to another level. This is how we can stand out among the G7 countries in our capital market economy.
The right financial tools would help us attract capital market investment in critical minerals. We're starting to see many examples of these tools at work in the United States. Americans are creative. By using these tools, they manage to secure the investments needed for projects. We must see what we can do in Canada using similar tools, which cost much less and which provide much greater leverage to attract capital market investment down the road.
Liberal
Claude Guay Liberal LaSalle—Émard—Verdun, QC
Thank you.
Mr. Williams-Jones, if I'm an investor, then I love the idea of having access to rare earth critical minerals within a couple of hundred kilometres of a major centre. My transportation costs are going to be low. Of course there will be enthusiasm from the investor market for this, which is what you're suggesting, so what's missing? Is it because we don't know the process for the type of geology you're talking about? Does it need to be refined before the investors show up and say, “Fantastic. We can do it close to Timmins”?
Logan Professor of Geology and Geochemistry, Department of Earth and Planetary Sciences, McGill University
Many of these deposits, or the complexes, are close to major centres, but they've suffered from a lack of exploration. For example, the company I'm representing today, I.E.P., has an interesting property. There's been no drilling there. There's some exposure, and they've been trying to, basically, raise enough money to actually have some exploration going on. We need to promote that exploration. That property will just stand there unexplored.
It was explored in the 1950s. In the fifties, there was a resource of about 150 million tonnes of niobium, lowish grade, but if you open-pit it, it could potentially be an economic resource. What is missing there is that there's been no exploration of the rare earths, ever, but the potential is enormous. We need to have a company with enough money to start drilling holes to see if that resource is there. There are lots of these little companies that own claims on projects that are close to major centres, but they don't have the money to actually take the step, and they can't interest the majors because they haven't gone far enough.
Liberal
The Chair Liberal Terry Duguid
Thank you.
Monsieur Simard, the last question goes to you for 2.5 minutes.
Bloc
Mario Simard Bloc Jonquière, QC
Thank you, Mr. Chair.
Witnesses, thank you for joining us. I encourage you to submit a brief if you want to add any information. It could be quite helpful and it would make the analysts' job easier.
We were also supposed to speak with Louis Ouellet today about the northern transportation corridor project. Unfortunately, he was unable to appear. Nevertheless, I would like to briefly touch on this topic by turning to you, Mr. Laberge.
The federal government is trying to extract critical minerals. We know that northern Ontario and northern Quebec have a concentration of valuable minerals. We also know that we need to improve the flow of transportation.
We don't have this type of map in front of us. I encourage you to submit one. However, if we had one, we would see an increase in mining projects around an existing rail line that needs upgrading. At the same time, we would see that this rail line can easily reach the Port of Saguenay.
In the near future, what types of investments do you think should be made in both the Port of Saguenay and the rail line? What might this look like? I also encourage you to submit any documents on this topic.
President and Chief Executive Officer, Saguenay Port Authority
I can tell you all about the investments needed in the Port of Saguenay.
In the relatively short term, the necessary investments would be around $150 million for improvements to port facilities and $150 million for the implementation of basic infrastructure for industrial development. In addition, Hydro‑Québec and Énergir must invest in energy infrastructure at the Port of Saguenay. We know exactly how much this will cost. We're ready to act quickly to put this infrastructure in place.
In terms of the rail system, some figures have been put forward for improvements at the regional level. Improvements in these areas can also be carried out in phases. We've heard a figure of around $700 million for the region.
Bloc
Mario Simard Bloc Jonquière, QC
I just want to clarify one thing for the committee. Based on your expertise, this can't be compared to the investment needed to transport critical minerals from northern Ontario to Hudson Bay. Is that right?
President and Chief Executive Officer, Saguenay Port Authority
As far as I know, the advantage of this project is that the tracks already exist. They just need an upgrade. We aren't talking about installing new corridors. We also aren't talking about existing rail lines found throughout the country, but about very prolific mining areas with existing rail lines that need some upgrading.
These rail lines actually connect two provinces. That's what makes this such a great opportunity. The advantages include speed, location and relatively lower costs compared to other places. They can also be put into service quickly, since they already work. However, they can work even better. In addition, projects are already in the pipeline in these areas.
Liberal
The Chair Liberal Terry Duguid
Colleagues, that's all the time we have for our witnesses. On your behalf, let me thank our witnesses for very informative testimony.
I think you could tell that MPs were very engaged in the discussion today. As Monsieur Simard mentioned, please, if you would like to submit a brief, I know it would be welcome by us and by our analysts.
May I give a final shout-out to Professor Williams-Jones for getting us all excited about rare earths. I married a geologist's daughter, and I had not heard the terms niobium or carbonatites. Thank you for introducing those new terms and this very exciting field you're involved in.
Thank you, Ms. Vasyukova, for joining us as well.
Colleagues, just before we break, the clerk has reminded me that we have another study on forestry coming up. It's suggested that we submit our witness lists on or before October 13, so that the analysts can start working on panels. As you know, these are living lists. We do adjust them as the study goes on, but we'd appreciate your witness lists being submitted on or before October 13.
With that I'll entertain a motion to adjourn.
