Plan Nord Rises from the Ashes
On September 30, 2014, the Québec government introduced a bill (the Bill) to the National Assembly for the creation of the Société du Plan Nord (the Société), marking an important step forward in its initiative to revive the Plan Nord. The Bill’s principal objective is the creation of the Société, a state-owned corporation charged with overseeing and coordinating the government’s plans to develop the territory north of the 49th parallel (Northern Québec).
The Centre of the Northern Economy
The Bill gives the Société the power and the resources it requires to:
- Establish the government’s guidelines and budgets with respect to the redevelopment of Northern Québec;
- Coordinate the build-out of infrastructure in Northern Québec, either alone or in partnership with others; and
- Implement and contribute to research and development with respect to mineral resources to be found in Northern Québec.
The Société will also have a marketing office tasked with keeping Québec businesses informed of ongoing equipment and supplier needs in Northern Québec.
Financing for the initiatives is expected to come through income generated by the Société’s investments, and from the Fonds du Plan Nord, which will itself be funded through tax revenues generated in the region.
The First Step of the Re-Launch
The creation of the Société is the first of several measures announced in the Québec government’s 2014-2015 budget on June 4, 2014. Other initiatives include:
- An endowment of $63 million in 2014-2015 to the Fonds du Plan Nord, funding which could reach $2 billion by 2035;
- The creation of Capital Mines Hydrocarbures, an investment fund of $1 billion which will allow the government to take equity positions in the mining and oil and gas sectors;
- $20 million to participate in a feasibility study on the construction of a new rail line to provide access to the Labrador Trough;
- A $100 million investment in educational facilities to support the academic and vocational success of the population of Northern Québec, and for the training of skilled workers;
- A $3.2 million commitment to revive the Québec Tourism Strategy in Northern Québec; and
- A $3 million fund to create a northern research and development centre.
The budget also contemplated the establishment of a committee to develop a strategy to speed up the provision of natural gas to Northern Québec by land and by sea.
The introduction of the Bill comes alongside the government’s announcement that it will invest $50 million in a new subsidiary of Québec natural gas distributor Gaz Métro which markets liquefied natural gas, further signifying the government’s commitment to the sector.
Adoption of the Bill marks an important step towards the revival of the Plan Nord. While the plan for revival does not meet the original 2011 plan in terms of scope and scale, the Québec government’s plans for the development of Northern Québec remain ambitious, giving investors a reason to be hopeful.