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Quebec gold mines deemed essential service, to reopen Wednesday

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Editor's Note: The article was updated to include comments from Iamgold Corp.

(Kitco News) - Mining companies with operations in Quebec are wasting no time jumping back into action after the provincial government announced Monday night that mining is now considered an essential service and operations can restart Wednesday.

While miners in Quebec will be heading back to work, the government has also put in place new work policies. According to the new provincial guidelines, mining companies will have to reduce the number of fly-ins and fly-outs from their mining sites and they are encouraged to use more local workers.

Under a new work regime, miners will see their time at work sites extended to 28 days instead of 14.

To maintain social-distancing guidelines, companies will also have to use more chartered planes and shuttle buses to transport their workers

It has not taken mining companies long to react to the news. On Tuesday, Yamana Gold Inc. (NYSE: AUY, TSX: YRI)announced that it was going to restart operations at the Canadian Malartic mine in Abitibi, Canada’s largest gold mine. Yamana operates Malartic in a 50/50 joint venture with Agnico Eagle Mines Ltd (NYSE: AEM, TSX: AEM).

“The resumption of mining activity will occur over a period of several weeks with full attention to the health and safety of returning employees, contractors and suppliers,” Yamana said.

Along with Malartic, Agnico Eagle said that it is also restarting operations at its LaRonde Complex and Goldex mine.

Eldorado Gold Corp. (NYSE: EGO, TSX: ELD) also said in a statement Tuesday that it is preparing to restart operations at its Lamaque mine in northern Quebec.

“We are pleased to resume operations at Lamaque,” said George Burns, president and chief executive officer of Eldorado. “With the safety measures we have put in place at all our sites, we are confident that we can adapt our business and continue to create long-term value for our stakeholders.”

Some of the new safety protocols Quebec companies will implement include temperature checks, mandatory social distancing, enhanced sanitation and disinfecting.

Meanwhile, Iamgold Corp. (NYSEI IAG, TSX: IAG)said it will restart its Westwood Gold Mine in Quebec on Wednesday.

“Ramp-up activities will take approximately one week, with employees being trained on new procedures and sanitary measures, including adjusted work schedules and transport, physical distancing and protective equipment,” Iamgold said. “Protecting the health and safety of our workforce is critical for the successful resumption of mining activities at Westwood.”

Quebec mines were shut down March 23 as the Quebec government closed all non-essential services to try to slow the spread of the COVID-19 pandemic. As of April 13, 360 people have died in Quebec as a result of the coronavirus.

The government’s decision to allow miners to operate again comes at a good time for the sector, according to some analysts. Gold prices have broken through critical resistance and are trading near fresh seven-year highs. June gold futures at last traded at $1,768.60 an ounce, up 0.41% on the day.

Meanwhile, mining companies are enjoying lower input costs as energy prices have not seen a sustained recovery after falling to an 18-year low last month. May West Texas Intermediate crude oil prices last traded at $21.46 a barrel down more than 4% on the day.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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