Mines have limited lifespans, and it is not viable to invest substantially in IT if that lifespan is too short. A wider vision needs to be adopted, specifically the realization that the mines of today will pilot technology that can be implemented in the future.”

Dany Pelletier & Serge Cotes

VICE PRESIDENT, STRUCTURING CAPITAL, ENERGY, ENVIRONMENT AND MINING & SENIOR INVESTMENT ADVISOR: FONDS DE SOLIDARITÉ FTQ.

April 26, 2019

Can you please provide a brief overview of Fonds de solidarité FTQ?

The Fonds de solidarité FTQ is a development capital fund that calls upon the solidarity and savings of the Québécois to help fulfill its mission to contribute to Québec's economic growth by creating, maintaining or protecting jobs through investments in small and medium-sized businesses in all spheres of activity.

Thirty-five years ago, the biggest central labor body in Québec –  FTQ – presented the idea of the fund to counter high interest rates and loss of jobs. This was an amazing innovation from a union with a target sum of C$100 million – today, the fund has more than C$14.8 billion in assets.

We are an investor that focuses on investing in companies that show promise for growth and job creation in Québec.

What does the Fonds offer specifically to the mining industry?

We began investing in mining 20 years ago, and our vision was to invest in exploration to ensure we have mines in the future. We invest small amounts of money in numerous junior companies that are exploring sites with different views, visions and approaches to ensure we have diversity and are invested in multiple territories.

In 2001, together with the government of Québec, we created SIDEXSI, an exploration fund dedicated to diversify our minerals and mining territories At that time, the Cadillac break constituted the core of mining in the Abitibi region, and our vision was to further open up the north.  Today, in 2019, there is a gold mine - Eléonore, that was not there at the time, and there is also the Renard diamond mine. Thus the north is now open, but there is still much room for further development and one of our additional goals is for tech to play a role in the expansion. In remote areas  we need to reduce exploration costs using technologies such as big data, AI, drones and others.

What options are available to juniors looking for funding, taking the recent growth in the cannabis and crypto currency markets into consideration?

It is a challenge, and the questions is how we are going to reinvent the financing model for junior mining exploration companies – we are trying to think out of the box to find solutions. In order to finance promising projects, we need to focus on talent management as well as innovative ideas.

Exploring an old mine with a similar vision to the past will not change anything. Widen your thinking and be innovative, and we will be willing to invest in your company.

AI, automation and digitization still play a relatively small part in the mining industry. What are the reasons for this?

It could be cultural in terms of focusing on day-to-day delivery and a matter of nature. Mines have limited lifespans, and it is not viable to invest substantially in IT if that lifespan is too short. A wider vision needs to be adopted, specifically the realization that the mines of today will pilot technology that can be implemented in the future. For this to be successful, changes are needed at head-office level and not at a regional level.

What is Fonds’s strategy for the future?

We would like to be more involved in the services industry. We want to look at secondary transformation such as the transition towards a low-carbon economy, clean power and green transportation. However, we first want to ensure that Québec is in the right position to achieve this and to become competitive worldwide. In terms of exploration, we will continue to do what we have done in the past, but in addition we want to have a different approach towards junior companies. A key aspect in serving juniors is to think ahead and anticipate what the capital market will look like in five years’ time. This is how we can invest in the right projects.

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