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Strateco sues Quebec for $190 million over stalled uranium project

by Greg Klein | December 12, 2014

Claiming damages for lost investment in its Matoush uranium project, Strateco Resources TSX:RSC launched a nearly $190-million lawsuit against the Quebec government on December 11. The suit alleges actions by the government and its environmental minister wiped out about $123 million spent on the project from 2006 to 2012.

Strateco sues Quebec for $190 million over stalled uranium project

Strateco spent $123 million developing a resource of 7.78 million pounds U3O8 indicated and 19.22 million pounds inferred.

Strateco claims the government strung the company along for years, issuing some 30 permits and praising Matoush’s benefits. In 2013, however, Quebec slapped a moratorium on uranium exploration following opposition from the James Bay Cree Nation. Later that year the province refused Strateco an exploration permit “alleging a lack of social acceptability of a certain group,” the company stated. The project was already permitted by the federal government and the Canadian Nuclear Safety Commission.

“Uranium exploration and mining are allowed in Quebec, both under the old Mining Act and under the new Mining Act that came into effect in December 2013,” the company states, adding that “the government never explained what it meant by ‘lack of social acceptability,’ a concept not defined in any Quebec law or regulation.”

Quebec’s BAPE inquiry is currently examining the environmental effects of uranium exploration and mining. Strateco has since moved into Saskatchewan’s Athabasca Basin. Last month the company announced a deal in which ASX-listed Toro Energy would acquire a stake in Strateco. Toro “has shown clear interest” in Matoush, Strateco indicated at the time. Toro’s experience in permitting an advanced Western Australian uranium project, “in an area formerly under moratorium, will certainly be an asset for Strateco,” the company added.

British Columbia’s 2008 ban on uranium exploration led to a $30.35-million out-of-court settlement. But payment has been held up by disputes among the beneficiaries.

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