EDITORIAL PAGE — Pulling up stakes

In Vancouver, one of Canada’s most entrepreneurial companies, Royal Oak Mines, is pulling up stakes and preparing to move its corporate offices across the border to Washington state.

British Columbia’s mines minister, in keeping with her function of offering awards and salutations at industry functions, has already waved goodbye and wished the company “good luck.”

The province appears not to have a problem giving its blessing to a departing company that has, in the space of several years, either saved or created 1,300 jobs at four mining operations across Canada. Cheering on the sidelines, no doubt, will be the province’s labor leaders — idealogues who still have not caught on that it is entrepreneurs, not governments, that create jobs.

It is well known that Royal Oak’s president, Margaret (Peggy) Witte, is no friend of either the labor movement or the province’s New Democratic Party (NDP) government. That impression was fixed several years ago when Witte hired replacement workers during a labor dispute at the company’s Giant gold mine in Yellowknife, N.W.T. Straining the relationship further is the still unresolved matter of government compensation for the expropriated Windy Craggy copper deposit.

In all fairness, it appears that some sort of government protocol prevented the minister from saying “sorry to see you go,” as this platitude is reserved only for departing companies that are interested in investing inside the province. Royal Oak, the minister explained, was not interested in making any more investments in British Columbia, hence Victoria’s blessing. It can be argued that Royal Oak’s move to the U.S. is motivated by financial advantages (including personal income tax savings), and this may be partly true. It also has much to do with the company’s acquisition and exploration plans in the U.S., which are focused on the search for gold using a proprietary technology designed to improve the identification of mineral deposits below substantial overburden.

But there is still considerable criticism, at home and abroad, of both the regulatory and tax environment in British Columbia — not to forget uncertainty about where companies can and cannot explore. Mining is an important cornerstone industry in the province, and the departure of any mining company ought to concern politicians.

Royal Oak is not the first company to move to the U.S., and it probably won’t be the last. Pegasus Gold, Golden Star Resources and Echo Bay Mines have all headed south. Several other companies, notably Placer Dome, are reported to be considering the idea. And a number of junior companies active in Central and South America are also eyeing American cities as headquarters; a U.S. base would make travelling to their southern operations easier. Then again, it should come as no surprise to British Columbia’s politicians that several mining companies are talking about pulling up stakes and moving their corporate offices out of the province. After all, that is exactly what they were warned could happen if they did not create a climate at home in which mining companies could prosper.

The provincial government may not be sorry to see Royal Oak move to the U.S., but we are. The company has accomplished much in this country and, with its exceptional talent and energy, could have done much more.