Strateco lodges damages claim against Quebec

12 December 2014

Strateco Resources has launched a claim for damages of nearly CAD190 million ($164 million) against the government of Quebec for the loss of its investments in the Matoush uranium project following the province's decisions to place a moratorium on uranium development and deny authorisation for advanced underground exploration.

Matoush 460 (Strateco)
The Matoush project (Image: Strateco)

The company says it invested an average of CAD20 million ($17 million) per year in the project from 2006 to 2012, "taking for granted" that the Quebec government would comply with existing laws under which uranium exploration and mining are allowed. The government had already granted it some 30 permits under various laws, regulations and guidelines "in the full knowledge that the activities in question were linked to uranium exploration and a planned uranium mining operation," the company noted.

However, in April 2013 Quebec announced a moratorium, saying that no permits for uranium exploration or mining would be issued until an independent study into its environmental impact had been completed. Then, in November 2013, the Quebec environment minister refused to issue Strateco with a certificate of authorization to begin advanced underground exploration at Matoush.

Strateco says that the government encouraged it to invest in Quebec and then "suddenly changed course" by announcing the moratorium and "wrongfully and arbitrarily" refusing the underground exploration permit.

"It should be recalled that on the basis of extremely detailed, rigorous environmental and social impact studies, Strateco received approvals for the underground exploration phase of the Matoush project from the Canadian Nuclear Safety Commission, the federal Minister of the Environment and the federal administrator of the James Bay and Northern Quebec Agreement, as well as a positive recommendation from the provincial evaluation committee," the company said in a statement.

No longer "realistically able" to interest investors in Matoush, Strateco closed the camp in June 2014 in an attempt to save costs.

Strateco is seeking a total of CAD189,897,663 in damages from the government, including CAD146,356,950 of losses plus interest and other related expenses.

Quebec's environmental assessment agency (Bureau d'audiences publiques sur l'environnement du Québec, BAPE) is now responsible for uranium development in the province. It launched a public inquiry on the uranium industry, which is still ongoing, in May 2014.

Matoush has indicated resources of 5600 tU at 0.81%U and inferred resources of 6320 tU at 0.375%U, and the company had previously projected production of 1000 tU per year over 7 years from 2016.

Researched and written
by World Nuclear News