VANCOUVER — On July 20 Canadian federal, provincial and territorial energy and mines ministers gathered in Halifax, N.S., for the 72nd annual Energy and Mines Ministers’ Conference. The event comes at a time that the mining industry is looking to government for help in weathering what has become a prolonged recession marked by falling exploration expenditures, project investment and share prices.
If the pitfalls of a struggling global economy and ailing commodity prices were not enough for the ministers to mull over, however, there are also a bevy of socio-political issues across the country that include waste management safety, sustainable development and aboriginal relations.
In fact, the Canadian Mineral Industry Federation (CMIF) released a brief — in partnership with the Mining Association of Canada and the Prospectors & Developers Association of Canada (PDAC) — aptly named Weathering the Storm, which focuses on three priorities as articulated by members of the mineral industry across Canada.
“We really have to get as creative as we can if we’re going to attract natural resource investment,” Northwest Territories Minister of Industry, Tourism and Investment David Ramsay commented during an interview. “In a time of downturn we have to be especially aggressive and go after it, or else things will get pretty scary. For us the key areas include ongoing investment in our workforce and more infrastructure projects.”
According to a PDAC report released in early March, global exploration budgets dropped by 26% in 2014. Canada and Australia were the top destinations for exploration, attracting $1.5 billion (13.9%) and $1.3 billion (11.7%). Grassroots exploration in Canada fell by 37% between 2013 and 2014, while spending on existing mine sites increased 13.5%, and spending on late-stage and feasibility work fell by 25.5%.
“It’s really important we establish a concrete strategy to help out the junior industry and fuel exploration,” Ramsay continued. “The reality is that money is scarce in both mining and energy right now. It’s a scary environment and we have to find a way to get money to junior mining companies so they can come in and find that needle in the haystack.
“That discussion, in terms of stock markets and regulatory bodies, really needs to come to the forefront. There’s been some talk about getting regulators across the country on the same page, and any effort to do that is always in everyone’s best interest,” he added.
The CMIF is also pushing government to improve its regulatory processes and further clarify a miner’s duty to consult with aboriginal communities and stakeholders.
Ramsay and his colleagues in the Northwest Territories have taken a partnership approach through the devolution agreements announced in mid-2014, which include a commitment to sharing 25% of resource revenues with First Nation partners.
The situation in other parts of the country, however, remains less well defined. It’s especially true with pipeline developments and recent clashes in B.C. over Imperial Metals’ (TSX: III; US-OTC: IPMLF) proposed restart of its Mount Polley copper mine, after a well-publicized tailings failure.
Over 50 environmental, First Nations and community organizations sent a letter addressed to all Canadian mine ministers urging them to take “immediate action to assess and prevent the threat posed by hundreds of mine waste dams and impoundments in Canada.” The groups specifically cited “the lessons learned from the August 2014 Mount Polley mine disaster’s investigation and findings in B.C.”
Ramsay counters that “we have a really great story to tell in terms of building relationships with aboriginal governments. We’re making some big strides in that regard and we’re proud of that work, because as we move forward we have to assure strong relationships” to develop a resource-based economy.
“I felt a genuine relief during our discussions around the table where we all agree that First Nations must be involved in development moving forward,” he added when asked about comments from other ministers in closed-door meetings.
The conference marked another first: the attendance of the newly elected, left-leaning New Democratic Party government in Alberta, where the resource-industry friendly Progressive Conservatives had held court for 40 years.
New Alberta Premier Rachel Notley has been vocal about creating a more responsible oil and gas industry in the province, and hasn’t offered much strategy in terms of getting more Albertan product to market via additional pipeline infrastructure.
Notley said during a press conference following a meeting of premiers and territorial leaders in St. John’s, N.L., that the new national energy strategy proposed at the provincial level will not force premiers of other provinces to automatically accept pipelines across their jurisdictions.
“We had the opportunity to meet the new energy minster from Alberta, Margaret McCuaig-Boyd, and it was a good meeting. We’d been working together on energy-related programs and we’ll continue to work with the Alberta government,” Ramsay commented.
“They’re very much in a similar position as us with ‘stranded’ resources, and Alberta needs to find a way to get oil to market. We’ve looked at the corridor concept in the Mackenzie Valley, which would include transportation, energy and communications. We’re also watching closely what happens with the liquid natural gas in B.C.”