Mining in the North will be on the rocks without timely action.
That was the message for the incoming MLAs who milled into an Explorer Hotel conference room Tuesday evening.
With most MLAs in attendance (Frame Lake’s Kevin O’Reilly and Yellowknife Centre’s Julie Green were holding a joint constituency meeting that night) President of the Chamber of Mines Gary Vivian stressed the need for further exploration and publicly funded infrastructure to jolt the industry and compete with neighbouring jurisdictions like Nunavut and Yukon.
“Investment in NWT has dropped significantly,” Vivian told the room. According to him, that’s mostly for two reasons: declining access with more protected areas and a “tough” regulatory regime.
The presentation also cited a 40-year gap in major federal infrastructure investment. However, Range Lake MLA and premier candidate Caroline Cochrane noted the Slave Geological Province survey received federal funding. Master of ceremonies David Connelly called these studies the government’s “shut up and go away for four years.
“It’s a cheap way to buy you off,” he said.
Connelly added earlier that “the proof was in the pudding:” there hasn’t been any significant greenfield exploration projects during the previous three assemblies. He said international investors perceived the NWT as unwelcoming and “a bad place to invest.”
He said association with carbon, especially diesel, oil and gas, will mar the social licence larger firms have been working to build up in the communities where they operate, discouraging them from investing in projects associated with higher emissions.
“I don’t think we’ll get a major investor in the Northwest Territories ever, unless we can show their board we have green power coming to the project,” he said.
The meeting follows a series of dire-sounding announcements for the industry. Credit agency Moody’s recently downgraded a bond issued by the parent company of Dominion Diamond – majority owner of the Ekati diamond mine, and a 40 per cent stakeholder in the Diavik diamond mine – as a bond “of poor standing” and “subject to very high credit risk.”
In July, the Conference Board of Canada projected an economic slump as the territory’s mining industry matures with few major economic replacements on the horizon.
For his part, Vivian didn’t see things at Ekati as negatively as Moody’s.
“But they are exploring. They haven’t given up,” he said of Dominion. “They aren’t walking away.”
He said the stalled Jay extension at Ekati is currently uneconomic (Dominion recently told Yellowknifer the project “is still under review.”)
And the influx of synthetic diamonds is having a “drastic” effect on the marketability of small diamonds, according to Vivian.
The companies are affected by the downed price, he said. “A lot of the stuff they’re going after right now isn’t high quality stuff.”
While the higher quality rocks are in their mines, it may come down to consumers going through the lower quality gems first, Vivian said.
He said strategies to boost mining capacity in the territory could include incentives for junior firms to exploration in the NWT, and pushing larger companies to develop now land they hold long-term leases on, he said.
Vivian has made similar presentations to other groups of MLAs. In closing Tuesday, he flipped to a slide of a probable sunset and asked if it was sunrise or sundown for the territory’s mining industry.