Strateco suing Quebec government $190m for blocking uranium project

Strateco Resources Inc. says it is suing the provincial government of Quebec for $189,987,663 following its decision to block the firm’s Matoush uranium project after allegedly encouraging it to invest. The company says it had carried out years of preliminary work.

From 2006 to 2012, Strateco claims it invested an average of $20 million annually in the Matoush project. It had assumed that “the Government would comply with its own laws.”

The company points out that uranium exploration and mining are permitted in Quebec, both under the old Mining Act as well as under the new Mining Act that became law in December 2013. Under its laws, the Government has granted about 30 permits, knowing full well that the activities were linked to uranium exploration and a planned uranium mining project.

Strateco says it was encouraged to invest

Apart from operating within the law, Strateco says the Government sent it positive signals on the Matoush project “among other things by including it among the 11 mining projects of the Northern Plan proudly announced by the Government.”

Strateco uranium projects

Source: Strateco Resources Inc.

Strateco says Government officials, including ex-premiers Jean Charest and Pauline Marois, used the Matoush project several times to showcase Quebec’s uranium potential

In November 2013, the Minister refused to grant the Quebec mining company the certificate of authorization it required to start the advanced exploration phase of the project, alleging a lack of social acceptability of a certain group. “Yet, the Government never explained what it meant by ‘lack of social acceptability.’” Strateco says this concept is not defined in any Quebec law or regulation.

On November 8th, 2014, nearly a year later, the Government said it would try to define what ‘social acceptability’ means. Strateco quotes the Minister of Energy and Natural Resources and Minister responsible for the Northern Plan, who said “Before putting (social responsibility) into law, we will first try to define it.”

Stateco accuses the Government of encouraging it to invest in Quebec and then suddenly pulling the rug by announcing a moratorium on uranium exploration and mining in March 2013, and finally “wrongfully and arbitrarily refusing to authorize the advanced exploration of the Matoush project.”

Apart from losing all the money it spent, the Government’s actions also resulted in investor reluctance, the closing down of the Matoush camp, and job cuts, the company claims.