After winning the general election last April, the Quebec Liberal party is taking steps to follow through on its commitment to northern development by giving new momentum to the Plan Nord. The government has indicated that it plans to invest C$3 billion in infrastructure in order to develop the north. An important element in northern development is transportation access from the resource areas of the north, particularly the Labrador Trough, to port.
On July 21, 2014, the Secrétariat au Plan Nord launched a call for expressions of interest to identify private partners interested in participating in a feasibility study to evaluate the need and options for the construction of a multi-user rail line from Sept-Îles to the Labrador Trough. The line is intended to open up the iron-ore-rich region and provide the transportation infrastructure necessary to develop several iron ore projects in the area. The study will estimate costs and determine the best railway option, including increasing capacity on existing lines and the building of a new line. The Quebec government (Government) will contribute up to C$20 million to the study. The Labrador Trough is among the world's largest iron ore deposits, with annual production of approximately 50 million tonnes. The Government believes that mining companies conducting mineral exploration in the Labrador Trough could be interested in participating in the study and benefiting from its results. By proceeding with a call for expressions of interest, the Government hopes to garner support for the project and make it possible to share the costs with other private partners. The Government has indicated that it favours the creation of a joint venture between private-sector partners to implement a future rail line project.
A feasibility study for such a rail line was previously initiated in August 2012, which included a group of six mining companies. The project was then suspended in March 2013. The market realities at the time resulted in delays in mine development projects located in and around the Labrador Trough. A review of the project indicated that mine construction schedules and diverging needs for each specific individual project made it difficult to obtain the critical volumes of iron ore necessary to support the building of new rail and terminal infrastructure. Concerns were also raised with respect to the technical challenges associated with the construction of the rail line over 800 kilometres of rough terrain.
Those interested in participating in the feasibility study are asked to communicate with the Plan Nord Secretariat before July 29, 2014.
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