November 2010

Power and the people

Infrastructure and engagement vital to mining resurgence in B.C.

By Dan Zlotnikov

Imperial Metals’ Red Chris gold-copper-silver property lies on a plateau, 1,500 metres above sea level, 80 kilometres south of Dease Lake in northwest British Columbia | Photo courtesy of Imperial Metals/Cas Sowa photo

Despite its wealth of natural resources, British Columbia has had a difficult few years. The mountain pine beetle has bored into the heart of the province’s forestry industry, and the global financial crisis compounded the damage. Similarly, mining — another pillar of B.C.’s economy — has suffered. An industry survey published by PricewaterhouseCoopers in May of this year highlighted the impact of 2009’s decreased demand: virtually every type of mineral B.C. produces saw a drop in revenue. Metallurgical coal, which accounts for just over half of the province’s net mining revenues, was down 24 per cent in shipment volumes and saw a 40 per cent price decrease compared to 2008.

As a victim of the economic downturn, the province is not unique. The mineral resource sector, however, has been in the doldrums for some time. Randy Hawes, the province’s Minister of State for Mining, puts it simply: “No new metal mines have been started up in British Columbia in the past ten years.”

“We went through a pretty dismal decade,” explains Pierre Gratton, president and CEO of the Mining Association of BC. “In the ‘90s, there was an exodus of mining companies for a whole host of reasons. The only reason the industry kept going was because there were some existing mines in place.”

But the past is the past, says Gratton, who believes the province is undergoing a mining renaissance. “The northeast coal region, which was down to no operating mines in the early 2000s, now has four operating mines with the potential to reach five or six in the next year,” says Gratton. “We’re also seeing a resurgence in base metal activity,” he continues, pointing out a number of projects in various stages of permitting and commissioning.

In fact, the PricewaterhouseCoopers report lists no fewer than 13 projects in various stages of permitting, and a further seven engaged in exploration work. This explosion of activity has not gone unnoticed by the provincial government, which has eagerly embraced the promise of both tax revenue and the new jobs these projects promise to deliver.

To make the operating in the province a more appealing prospect, the B.C. government has acted in two directions simultaneously: initiating new infrastructure development projects and signing mining revenue-sharing agreements with three First Nations bands.

“B.C. never entered treaties with most of the First Nations,” Hawes explains. “The supreme court here has ruled that there are rights and titles that exist in B.C. that were not extinguished through treaty-making or any other means, so we are obliged by law to enter this consultation and accommodation process.”

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