One of the great assumptions with the Quebec spodumene rush of 2023 is that the companies that are just starting to kick rocks now will somehow benefit from the expected lithium shortfall between now and 2030. Sayona, which did sterling work to restart the NAL operation in less than a couple of years, are working on having their Moblan project into production by 2027, less than 5 years time, even though they are still drilling out their resources. Winsome at one point was talking as if for their flagship Adina project they would be through the environmental and social impact assessment and into production in 3 or so years based partly on discussions they had had with Quebec public servants. As for the more than twenty or so ASX listed juniors that have taken up tenements in Quebec but are yet to even start drilling ... This is a point that Joe Lowry, bless his soul, has made as has the boss of Piedmont: any production from Quebec in the next period will only come from the projects already under development.
I think there is widespread confusion on hc about state or provincial governments, and national or federal governments. Often I read a comment along the lines that because the Commonwealth government agency is thinking of handing out a grant to a miner it somehow means that the WA or Qld state government has had input into that decision and will act in line with that decision. Wrong, wrong, wrong, they are totally different systems which have their own decision-making processes, restrictions and objectives.
In the case of permitting of mining ventures in Quebec my understanding is there needs to be approval from the Canadian government and there needs to be approval, separate and independent of the national government approval, by the Quebec government. The Canadian government approved the James Bay project on 16 January this year, attaching over 200 conditions to that decision. It is a separate assessment process to what is currently being run at a provincial level.
Furthermore, the decision by the provincial government is made on the recommendation of the government agency which has the acronym, COMEX. From memory, the Quebec government is not totally compelled to accept the COMEX recommendation but if their final decision does not align with the COMEX recommendation they have some explaining to do.
So, it is quite possible that the Canadian national government is gung-ho about permitting spodumene projects, and it is quite possible that there are parts of the Quebec government bureaucracy, such as Investissement Quebec, that are equally as gung-ho as the national government about permitting spodumene projects. All that counts for nought if the bureaucrats in COMEX think it appropriate for them to be as slow and as conservative as they like in making a recommendation to the Quebec government.
And here is the rub. If you were about to embark on a career in the Quebec provincial bureaucracy and your primary motivation is to support economic development of Quebec would you join the agency that actively contributes to that growth, such as Investissement Quebec, or would you join the agency responsible for environmental and social protection? Equally if your motivation was to protect the environment I expect you would more likely join COMEX than an economic agency.
So the Canadian national government and the Quebec provincial government can proclaim as much as they like that they are all for the rapid development of a vertically integrated lithium industry. All that mining and industrial development has to get past a group of bureaucrats who see it as their lifes' mission to protect the environment and the indigenous peoples.
For the Rose project it took the company Critical Elements another 13 months from when they received national permitting to when they got Quebec permitting. For Allkem's James Bay project, we are at six months and counting since it got national permitting. Until the Quebec government makes adjustments to its ESIA process the potential growth of the lithium sector in Quebec will be hobbled. (an example of not changing the process but changing the speed of the process is where the Qld government provides selected mining projects with a chaperone service to help companies developing those projects to navigate through the bureaucracy of obtaining permits).
AKE Price at posting:
$15.88 Sentiment: Hold Disclosure: Held
