Hello Mr. Blanchette. It has been almost a year since we met you on behalf of Bulletin Québec Mines. Tell us about your first year as Minister.

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1 Jancimon Reid, Ministère de l'énergie et des Ressources naturelles In July 2014, Mr. Luc Blanchette, newly assigned to the role of Minister for Mines, was interviewed by Bulletin Québec Mines. After his first year with the Ministry, we were pleased when Mr. Blanchette agreed to another interview. Here is what he had to say. Hello Mr. Blanchette. It has been almost a year since we met you on behalf of Bulletin Québec Mines. Tell us about your first year as Minister. To be honest, there were 6 months of adaptation and 12 months of operation, so it felt like 18 months in one year. There was all the parliamentary work the Blue Room, the question periods, the departmental allocation review and the parliamentary committee because we submitted our first bill. I had to adapt to all that, and to working with the media when they needed information. I am a very talkative person, so I had to learn to restrain myself and be as pertinent and concise as possible. To sum it up, it was a very rich experience. After six months, I was truly immersed in politics and felt strongly about our purpose to make positive changes. During the first few months, people spoke of renewal. The aim was to bolster economic activity to regain some political stability, and also to provide some predictability for investors so they know what they are getting into. This made for a year full of fruitful exchanges, appropriation and familiarization. And now it is time to move on to other things. It s time to focus on development. During your previous work experience, you were involved with the mining sector. As Minister for Mines, what did you learn during this first year that you didn t know before? I have 30 years experience as an economist in the mining industry, so it was indeed a field I was already familiar with. However, I was less familiar with the Ministry s energy, resources and mining branches. I had to learn more about other sectors outside of industrial development. This is how I got to meet so

2 many dedicated, devoted and competent people with extensive expertise. And I was truly impressed by SIGÉOM, which I had never used before, not being a geologist. I was also impressed by the Québec Mines convention, by the radiance of this event. As for PDAC, I had only ever heard of it before. To experience the liveliness of the mining industry, with all of its partnerships, was new for me and frankly very constructive. I learned a lot, and discovered just how dedicated the people are. Which assignments captured your attention the most during the past year? There are several. The first thing we had to do was reassure everyone, because the Mining Act had just been voted through in December We had to tell everyone: We don t want to change the Act, we want to move forward in its intended direction. On this there was consensus, support from all the parties. Nobody wanted to overturn the law, so the challenge was to reassure all those concerned and instil a sense of stability and forward progress. We also participated in consultations on government land-use planning policies [Orientations gouvernementales en matière d aménagement du territoire: OGAT]. It is a delicate matter because it involves municipal governments, the mining and exploration sectors, agricultural producers and several other players. We believe we have found a balance by establishing areas of incompatibility in the municipal sector. The bill on transparency had been announced in two budgets already. Now it has been officially introduced. This is also a recent development, and we worked on it a lot during our first year. A high note in all this was holding consultations in the province s mining regions: Sept-Îles, Chibougamau, Rouyn-Noranda, Québec and Montréal. It was an excellent opportunity to learn more about people s concerns. The consultations were ably conducted by the Associate Deputy Minister for Mines, and honestly, they produced some very conclusive results. When you started, you were committed to restoring a climate of confidence in the mining sector, which was sorely needed in Québec. Do you feel you have succeeded? It was surprising. We were delighted because the best indicator is still the Fraser Institute, which ranked us 6 th among 122 mining jurisdictions! Frankly, it was an amazing achievement to move up from 18 th place in terms of investor attractiveness to 6 th. We won t claim mission accomplished! just yet, because the situation is still fragile, particularly in terms of Aboriginal and environmental matters, but we are very proud to be ranked sixth.

3 You spoke earlier about the round of consultations held in several regions across the province that helped you take the pulse of the mining sector. Tell us about your findings. In Chibougamau, the people were content because the Stornoway Project is in full development, and Goldcorp s project is also advancing. The feedback was positive. In Sept-Îles, it was a little different. We held our consultation before the Arnaud mine announcement, a project that will spur economic growth by bringing in contracts for suppliers and equipment manufacturers, and so on. So although there was a feeling of optimism, they were anxious to hear some positive news. When we went back a week after the announcement, people were ecstatic. In Abitibi-Témiscamingue, our consultation coincided with the dismantling work at Éléonore, in the sense that the development phase was over and subcontractors had left the construction site. Mining development has a big impact on the region s economic activity, on their revenue figures, so having projects in the pipeline is always important. I have to admit, the sentiment was a little on the pessimistic side. However, we should soon have some good news for them. [editor s note: Mr. Blanchette was referring to the announcement of Royal Nickel s certificate of authorization for the Dumont mine, which was very good news for the region]. Fortunately, for Québec as a whole, there are 5 mines currently in development, 20 mines at the deposit appraisal phase and 350 exploration projects. Things are obviously moving. We mustn t forget that suppliers and equipment manufacturers are found throughout the province, and they benefit from this work. The financing of mining projects is an important issue. In your view, where do we stand? Basically, I m not overly optimistic, but I m not pessimistic either. I would say that we are experiencing relatively stable or even slightly positive growth. This seems to be the trend. In terms of mining jurisdictions, we are among the best positioned for foreign investment, even though investments are difficult to secure. We have a favourable fiscal system, and geological expertise. And we have very favourable legislation. We already have a good Mining Act, and let s not forget about the bill on transparency. I think we have made real progress in terms of investor attractiveness, and the Fraser Institute recently recognized this.

4 In your opinion, what have been the main achievements during the past year? Basically, the first major step was to introduce the regulation respecting mineral substances, natural gas and petroleum, which sets forth the provisions of the Mining Act. This includes the notion that exploration work cannot be carried out just anywhere, especially not on private land. People must be informed, notices published. This includes consultations, which companies whether they be in exploration or mining must hold with residents, communities and municipalities. This serves as a mechanism to organize citizens concerns, and in so doing will help companies plan mitigation measures. There are also fiscal measures, notably a 35% reduction in work requirements on claims. And the mandatory fees have been postponed for one year. We are very proud of that. We are also proud of introducing the bill on transparency. It brings us in line with the United States, Europe and the rest of Canada. Another source of pride is our economic diversity. Yes, iron has slowed due to the lower price worldwide, but lithium, rare earths and graphite are minerals that were not part of Québec s repertoire just 20 years ago. This is a new direction for us, making us the most diversified Canadian province in terms of metals and minerals. This is significant. Something else that I find very rewarding is the focus on the environment and social acceptability that has swept through the industry. It is not just theory and the government. The Canadian Mining Association put forth its initiative Towards Sustainable Mining, which was adopted by the Mining Association of Québec. All the association s members, roughly 25 mines, decided to embrace the approach. It represents best practices in environmental matters and social acceptability, whether it be with host or Aboriginal communities. It can be thought of as an ISO for mines, ensuring a very responsible way of operating. At this point, do you think there is a lot left to do so that the climate improves and investments multiply in the mining sector? Before, we were very focused on exploration, mining and primary processing. Now this isn t enough. We have to include the equipment manufacturing sector, service providers, R&D, education, training and the international stage. This is because, during market slowdowns, contractors, explorationists and mining companies look at the world as their playground and think we can export our expertise. The same holds true for R&D or for environmental mining. So we need to expand our horizons. We can no longer single-mindedly concentrate on the primary sector as we have done for so long. For many years, there were five primary processing companies in Québec. Now we have 17, which is a lot! We have nearly 400 equipment suppliers that focus the majority of their activities on mining or processing operations.

5 My dream, and I don t know if I will achieve it although it is gaining more attention, is hydrometallurgy. If we can develop hydrometallurgy, we will create well-paid high-quality jobs in technology and science. I am not just talking about mining regions, but also intermediate regions like Montérégie, Saguenay Lac- Saint-Jean, Montréal and a little throughout the rest of the province. Even though it would be centralized, these are jobs; the plants employ between 600 and 1,600 people, sometimes up to 2,000. It is a production chain that could be developed. I am counting on this possibility to create value through increased processing. Rare earths and lithium should make it possible. What do you think will take up most of your time in this coming year? Without a doubt, the development of the Plan Nord region is a strategic focus that we will continue to work on. We must plan well. It s not just about mining, it s also about tourism, forestry, the environment. We want the overall plan to be structuring. We will have to invest in road, railway and maritime infrastructure; the same applies to telecommunications. We also need to help people understand the mining industry, because it is an industry that is still poorly understood in many parts of Québec. Advancing the Plan Nord will surely benefit all the province s regions. We have business to do; there are business projects to be realized. We need to get the rest of the world interested in Québec for its massive development potential. We can view the Plan Nord and the Maritime Strategy as two international development strategies. The bill on transparency will likely take a lot of my time as well. We will go to the parliamentary committee again, so we will be engaged in many constructive discussions, or at least so I hope. We will also be working on regulatory simplification, to speed things up and avoid undue delays to companies. In the context of the big cleanup currently underway in the Québec Government, I really count on the help and support of these civil servants, on their expertise, to ensure we develop in a manner that is environmentally friendly and in harmony with the communities that host the projects. These are not simple challenges, but I think we can face them with confidence. What is the overall message you would like to give to the general public about mining in Québec? An important message about economic benefits. I said it earlier: economic benefits are not just for mining regions When there is a mine, there is a salary mass, there are taxes being paid. There are also consumption taxes when people start to spend their salaries, there are subcontracting businesses, and

6 there are donations made to communities, events and cultural activities. There are a lot of spinoffs, but moreover, these are projects that generate revenue for suppliers and equipment manufacturers outside of mining regions. We create a lot of positive economic benefits through the mining industry. Many people don t know this. We must remind people that it wasn t like that in the 1950s. The mining industry has become much more responsible, work safety is everywhere. We also see the progress by mining companies on the environmental front. They aren t perfect, but nobody is perfect. We are in the 21 st century and we need to look at things in that perspective. It is not like it was before: it is a highly modern industry. To have good social, educational programs or health programs, it takes collective wealth. And the mining industry contributes to that. You attended last year s Québec Mines convention, a key event organized by the Ministry. What did you think of your experience? It was absolutely fantastic! There were lots of people, and so many young people. It s wonderful to see that young people enjoying their first experience with the workshops put on by the Canadian Institute of Mines. And the importance of the booths cannot be ignored. It was a rich and rewarding event in terms of exchanges. It is at Québec Mines that we unveil the results of the Ministry s geology work carried out over the summer season. It is an opportunity to share our geological knowledge. The world of geology is often a small circle, but now it seems as if we are opening the doors to our industry and I think people will be interested. It is truly a great event, and I think we should be proud. It has been around for 35 years, so I think we can consider it an institution. Will I be around for our next year s event? Absolutely! Thank you very much, Mr. Blanchette!