Getting big things done. Maybe.
The journey of a thousand miles begins with a single step. But it doesn't *end* there
One of the projects Mark Carney mentioned in his Major Projects Office announcement last Thursday was Phase 2 of the Nouveau Monde Graphite project, two hours north of Montreal. I don’t know the company and I haven’t met its CEO, but I figured a look at the project and its challenges would help me understand what the feds are trying to do with these Major Projects. Here’s what I’ve learned.
The company’s CEO, Eric Desaulniers, founded a mining company 14 years ago, before he knew what he’d mine. Helicopter surveys led to the discovery, in 2015, of a big graphite deposit a couple of hours’ drive north of Montreal. Graphite is important for making batteries and semiconductors. China produces 70% of the world’s commercial-grade graphite.
Fast forward a full decade, to 2025. After a stupendous amount of work, Nouveau Monde has a demonstration mine that serves as proof-of-concept but doesn’t produce commercial quantities of graphite; plans to build a bigger mine at Matawinie, which would produce a middleweight 100,000 tons per year within a couple of years; and longer-term plans for an even bigger mine that would quintuple that yield. The way things stand now, investors are skeptical about the company’s stock value. “Negative cash flow” and “zero revenue” are downer phrases for investors.
So Nouveau Monde could make Canada a significant producer of a valuable commodity that would displace Chinese supply everywhere it sold. But the downside risk is considerable and the clock is ticking. On the bright side, the project proponent had already spent more than a decade proving he means it before the Carney government came along.
The question now is what happens next, and what should happen next.
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