MINING IN BRITISH COLUMBIA: Records broken in 2008

VANCOUVER - The British Columbia mining industry posted record financial results in 2008, according to a Pricewater...

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VANCOUVER — The British Columbia mining industry posted record financial results in 2008, according to a PricewaterhouseCoopers (PwC) report, The Mining Industry in British Columbia - 2008, recently released. Returns on shareholders investments in the province's operating mines, based on pre-tax earnings, reached an unprecedented 98% in 2008, up from 46% from 2007.

 

Gross mining revenues in the province were $8.4 billion in 2008, while net mining revenues were $6.8 billion, up $1.5 billion and $1.2 billion, respectively, from 2007. The leading commodities were coal (22.3 million tonnes worth $3.2 billion); copper concentrates (850,000 tonnes worth $1.2 billion); lead and lead concentrates (85,000 tonnes worth $200 million); molybdenum (worth $472 million); gold (worth $231 million); silver ($272 million); as well as zinc and zinc concentrates (327,000 tonnes worth $736 million)

 

The British Columbia mining industry spent $6.1 billion in 2008 compared to $6.4 billion in 2007. Exploration was one area where spending (excluding juniors) decreased to $86 million, down 46% from 2007 levels.

 

There was good news for employees in 2008. Total salary and benefits amounted to $858 million, up 13% from the previous year. Average individual salaries and benefits reached $112,800, or 11% above 2007. Employment was up 2% to 7,607 people.

 

PwC's survey summarizes the 2008 year-over-year financial information of 18 operating metal and coal mines (including Teck's Trail metallurgical complex), nine operations in the permitted or active permitting stage, six mines in the reclamation stage and seven advanced exploration stage properties, all in BC. There were a total of 40 participants for 2008, the same number as 2007.

 

Other key findings from the PwC report include:

 

? Total metals and coal shipments from BC mines increased by 8% to 26,840,000 tonnes in 2008 from 24,854,000 tonnes in 2007.

 

? Capital expenditures were $853 million in 2008, a decrease from $964 million in the prior year. Machinery, equipment and construction materials purchases dropped by $31 million to $448 million in 2008.

 

? Production materials and supplies spending decreased by $59 million to $639 million in 2008.

 

? Total exploration expenditure in British Columbia, estimated at $416 million in 2007, decreased by 12% to $367 million in 2008, according to the Mining and Mineral Exploration in British Columbia, Overview 2008.

 

? BC's mining industry made total payments to the government of $545 million, an increase of $82 million from $463 million in 2007. Direct tax payments increased by $75 million to $365 million from $290 million in 2007, corresponding to increased net earnings for 2008.

 

The PwC study may be read in its entirety at www.PwC.com/ca/eng/ins-sol/survey-rep/mining-bc-2009-05-en.pdf.

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