Whitehorse, Yukon, was the site of this week’s conference of Canadian energy and mines ministers. The meeting brought together ministers from the provincial, territorial and federal governments. This forum is an opportunity to propose co-operative change for the mining industry, but one might wonder if the ministers have taken two steps forward and one back this year.
First, the delegates took a predictable step forward. The ministers called for a renewed mining action plan for this country. They believe that governments have an important role to play in creating the foundation for a competitive industry. Three priorities were noted: better co-operative geological mapping strategies; an improved regulatory process; and continuing environmental protection measures.
Second, the mines ministers released the Mining Information Kit for Aboriginal Communities. This describes the mining cycle and identifies opportunities available to aboriginal people. Native communities can then make more informed decisions and participate more fully in mining projects. The kit was created by the PROSPECTORS & DEVELOPERS ASSOCIATION OF CANADA, the MINING ASSOCIATION OF CANADA (MAC), the CANADIAN ABORIGINAL MINERALS ASSOCIATION, and on the federal side, NRCAN and INDIAN & NORTHERN AFFAIRS. This is another step forward.
And then comes a step backward. Gordon Peeling, MAC president and CEO, made a strong call for government support of the industry in a speech entitled, “Times are good, but crisis looms.” The crisis facing the industry, he said, was due to three issues: declining reserves, human resource constraints and regulatory inefficiencies.
“Solutions [to the reserve shortage] are clear: a combination of new geoscience and exploration investment. Yet, three successive federal budgets and two governments later, the co-operative geological mapping strategy remains unfunded,” he said. To address regulatory problems, the MAC wants the federal government to establish a co-ordination office to monitor progress, resolve bottlenecks, and act as an ombudsman for mining project proponents. And finally Peeling called on government support to address the human resources shortage facing the industry.
And that is the step backwardasking that governments solve the industry’s problems. At the risk of becoming unpopular with our readers and the industry associations, let us set out the following thoughts.
Yes, governments do set the regulatory and environmental parameters, but in the experience of CMJ staff the situation is far from as dire as MAC outlines. We have chronicled continuous improvement in the process in many provinces, particularly British Columbia, Ontario, Quebec and Nunavut. Let us encourage further improvement, not layer on another government agency.
Yes, governments should do their share to map the geology and surface deposits of the country through maintaining strong geological surveys. This type of research goes a very long way toward pointing prospectors in the right direction, but it has been sorely underfunded in the past couple of decades.
Reserves in this country have not been replaced as quickly as mining has depleted them, but it is not the role of government to increase reserves by finding individual deposits. That is the job of mining companies, which should invest in and maintain strong, successful exploration departments, not rely on juniors who can find the deposits more cheaply. You get what you pay for.
The blame for the shortage of trained and experienced workers rests with our industry. Look at our track record.
A company that cuts its exploration department when it is making less money won’t have the experienced geologists to find future reserves. Worse, the pool of students willing to study geology will dry up. (It has already happened.)
A company that will pay anything for tradesmen and engineers when commodity prices are high and then cuts employee numbers to the bone when they drop will lose its skilled workers. People can and will travel to other industries.
A company that makes tremendous profits from high commodity prices and then spends that money in takeover attempts, non-completion fees, and severance and legal costs has no reason to go crying to government for help later on. A well-managed company would have put its profits into training and technology to create an enterprise that can weather low prices, which will inevitably happen.
All we believe the industry needs is for government to provide the keys to mining success. Give us good maps and data, consistent rules, fiscal incentives and less bureaucracy. These things will all help the industry solve its own problems in a manner that benefits mining and all Canadians.