Decline of mineral reserves a major concern

The outlook for sustained production of many of Canada’s metals is gloomy, says a recent report by Energy Mines and Resources Canada.

Seven metals — copper, nickel, lead, zinc, molybdenum, silver and gold — are reviewed in Canadian Mines Perspective from 1990. Except for gold, recent exploration has not produced the new mines required to replenish declining resources, and there is an urgency to expand the scope and intensity of exploration.

In the meantime, the main hope of maintaining output in the short term is to develop deposits found in the 1950s, 1960s and the 1970s.

Until the early 1980s, Canadian reserves of metals were generally on the rise. Except for reserves of gold which have kept on rising, reserves of the other metals generally declined each year during much of the 1980s. Reserves in this context are proven and/or probable; possible reserves are not included.

Compared with 1981, reserves in 1990 were down 20% for silver, 26% for nickel and zinc, 27% for copper, 31% for lead and 57% for molybdenum. Gold reserves on the other hand were more than double those of 1981.

Despite the seemingly optimistic gold picture, there are disquieting signs. Gold contained in reserves, as of January, 1990, totalled 1748 tonnes (proven and probable). This estimate was down 70 tonnes from 1989 (a small decrease) but it is the first setback to the upward trend

established in the 1980s. Mine-site exploration did not replace all the ore that was mined during 1989. Significantly, an amount of gold-in-ore equal to about half of what was mined in 1989 is no longer counted in company reserves. Exploration expenditures in 1988 totalled $1,350 million (almost the same as in 1987) but dropped to $828 million in 1989. Preliminary figures for 1990 and 1991 are $751 million and $646 million, respectively.

Surface exploration drilling dropped dramatically to 3.165 million metres in 1989, a drop of 41% from 1988.

In 1975, 7% of exploration expenditures were directed toward gold. In 1987, this reached a peak of 83% and in 1989 had declined to 67%.

Base metal exploration suffered as a result: 63% of exploration expenditures were directed toward base metals in 1975, 11% in 1987 and 23% in 1989.