Mining investment drops 35% in Québec in 2014

Québec, November 17, 2015 – A downward trend in metal prices and a reduced access to capital have both impacted mining investment in the last couple of years. After nine years of growth and record investments of $5.1 billion in 2012, mining investment in 2014 declined in Québec for the second consecutive year. In 2014, mining investment dropped by 35.0% compared with the previous year and stood at $3.0 billion, and recorded a 10.8% decrease in 2013. This was revealed in the Mines en chiffres 2014 bulletin, made public today by the Institut de la statistique du Québec.

Between 2013 and 2014, investment in mine complex development (-36.6%) and on-mine-site exploration and deposit appraisal (-24.2%) posted the largest decline compared with investment in off-mine-site exploration and deposit appraisal (-15.2%).

Nord-du-Québec ($1.3 billion), Côte-Nord ($0.8 billion) and Abitibi-Témiscamingue ($0.8 billion), Québec’s three main mining regions, shared 95.9% of total investments in Québec. Compared with 2013, the investment level decreased in all three regions. The Côte-Nord region was the hardest hit with a 59.3% drop in investments, mainly due to the price-collapse of iron. Furthermore, the Nord-du-Québec and Abitibi-Témiscamingue regions saw their investment level fall by 18.3% and 9.6% respectively.

According to intentions expressed by mining companies, investment could reach $2.7 billion in 2015.

Investment in mine complex development down in 2014

Despite difficult economic conditions prevailing in 2013, the investment level in mine complex development remained relatively high, down 7.0% from 2012. However, in 2014, these investments decreased 36.6% from the previous year, reaching $2.7 billion, i.e. $0.9 billion in general rock work, $1.1 billion in capital costs (non-residential construction, machinery and equipment) and $0.7 billion in non-capital repair and maintenance expenditures.

Gold mines figured prominently in the Québec mining sector, representing 52.7% of the mine complex development costs. Iron mines and iron and titanium mines came in second place with a 29.6% share of these costs.

Lower exploration expenditures in 2014

In 2014, exploration expenditures in Québec, including on- and off-mine-site deposit appraisal costs, reached $317 million, down 16.9% from the previous year and down 61.9% from the record investments of $834 million in 2011.

The Nord-du-Québec region ranked first in exploration and deposit appraisal investment with $167 million, i.e. 52.7% of the Québec total. It was followed by Abitibi-Témiscamingue, where investments totalled $62 million (19.4%), Côte-Nord with $52 million (16.3%) and Saguenay–Lac-Saint-Jean with $29 million (9.2%).

Gold remained the most sought-after commodity in Québec, accounting for 35.4% of exploration and deposit appraisal expenditures for a total of $112 million. It was followed by base metals (21.2%, $67 million), and iron ore, iron and titanium (12.2%, $39 million). Phosphate generated interest, representing 8.3% ($26 million) of total exploration and deposit appraisal expenditures in Québec, while rare earths, graphite and diamond accounted for 13.1% ($41 million). Although gold remains very dominant, mineral exploration is becoming more diversified and the search for less conventional mineral substances is increasing. In fact, a dozen exploration projects focusing on phosphate (apatite), rare earths, graphite or lithium have reached the deposit appraisal phase.

The Institut de la statistique du Québec produces, analyses and disseminates official, objective and quality statistical information on various aspects of Québec society. It is the statistical coordinator for Québec and the relevance of its work makes it a strategic ally for decision makers and all those wishing to learn more about Québec.