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Mining survey says: streamline regulations

A bag of prospector's tools. Pixabay photo
Exploration and mining companies give the Nunavut high marks for mineral potential but, in an annual survey conducted by the Fraser Institute, indicate that layers of red tape remain a deterrent.

The North’s geology is alluring to exploration and mining companies but regulatory red tape remains a stumbling block, according to the recently released Fraser Institute Annual Survey of Mining Companies, 2018.

Exploration and mining companies give the Nunavut high marks for mineral potential but, in an annual survey conducted by the Fraser Institute, indicate that layers of red tape remain a deterrent.

The NWT ranks at the top in Canada for its mineral potential while Nunavut is number two in that regard. However, government is not perceived to be getting any more mining-friendly, said Ashley Stedman, one of the authors of the Fraser Institute’s report.

“We still see that there’s considerable room on the policy side for improvement,” she said, noting that the NWT ranked 42nd in policy globally over the past couple of years while Nunavut is 45th this year, up only one spot from last year. “In particular, regulatory duplication and inconsistencies seems to be an escalating issue in the Northwest Territories and Nunavut. The majority of respondents see this factor as a deterrent to investment.

“Governments need to focus on streamlining regulations to ultimately attract those valuable investment dollars that can lead to jobs and opportunity,” said Stedman.

Other areas where industry cited a mild to strong deterrent in the territories were a lack of or poor quality infrastructure, such as roads and power; uncertainty over the potential to protect land as wilderness, parks and archeological sites; uncertainty over the interpretation and enforcement of existing mining regulations; and socio-economic agreements, pertaining to local hiring and purchasing. The latter is cited as a bigger issue in Nunavut than in the NWT.

Although the Fraser Institute doesn’t reveal the exact number of respondents per jurisdiction, both the NWT and Nunavut had 10 or more companies offering critiques.

Working group in place

The Government of Nunavut formed an Investor Confidence Working Group last year, whereby mining industry executives are invited to sit down with senior government officials and politicians, said Bernie MacIsaac, assistant deputy minister of Economic Development.

“We basically have a discussion about the issues that are important to the industry,” MacIsaac said. “We kind of talk among ourselves to see what we can do to fix those issues – some of them are regulatory, some of them are infrastructure.”

Inuit leaders have been welcomed to the table as well, MacIsaac noted, adding that another session will be held during the Nunavut Mining Symposium.
“We all have our little piece of the pie here when it comes to regulation and the regulatory system,” he said. “It’s in everybody’s best interest, and I think everybody recognizes that, that if we want to continue getting these mines in this territory, you’ve got to have exploration to come in behind it. As you know, these mines close and you need new mines to fill in behind them. There’s been huge investment in training and getting people employed… we want the people of Nunavut to get those jobs.”

Tom Hoefer, executive director of the NWT and Nunavut Chamber of Mines, said while it’s expensive to explore in the North, the odds of finding metals or minerals is likely higher than in most Canadian locales, and sometimes at much shallower depths.

Despite this, there’s little grassroots exploration in the NWT, Hoefer noted. Most of the exploration is taking place on ground that’s already been tested previously. Part of the problem is lengthy response times, he said.

“We have issues in both territories with permitting that need to be fixed. In the NWT, 70 per cent of respondents (in the survey) say permits were received in two months,” he noted, adding that in Nunavut 90 per cent took longer. “Not good.”

In Nunavut, 63 per cent of industry respondents weren’t confident they would ever get permits while in the NWT 40 per cent were unsure if their permit requests would be approved at all.

“From recent experiences, I’d say that in the NWT, exploration permitting needs to be examined and made more efficient,” said Hoefer. “In Nunavut, uncertain access to some Inuit-owned lands is chilling investment.”

He credited the GNWT and Indigenous governments for aggressively marketing the NWT as an investment destination at conferences like Roundup in Vancouver and PDAC in Toronto, meaning more investors are taking note. However, improvement in investor confidence is needed to reverse the trend of falling exploration expenditures in both territories, according to Hoefer.

The GNWT Department of Industry, Tourism and Investment didn’t respond to a request for comment prior to deadline.