Building tomorrow’s economy today

BC Mine 2023

As part of our BC Mine 2023 report, we wanted to give the leader of the Mining Association of British Columbia an opportunity to discuss the future of the mining sector. Read more about what he feels is needed to position Canada as a leading global supplier of critical minerals.

To capitalize on critical minerals, it’s time to turn plans into action

By Michael Goehring, President and CEO, Mining Association of British Columbia

Efforts by Canada and other countries around the world to transition their economies to cleaner sources of energy require modern technologies built with critical minerals. Everything from semiconductors and batteries to solar panels and wind turbines depends on these essential ingredients, which include copper, zinc, aluminum, molybdenum, cadmium, cobalt and many others.

Of the 31 minerals deemed critical in Canada, 16 are found in British Columbia.

Bringing these minerals to market—in the form of 17 proposed mines in advanced stages of development—represents CA$36 billion in near-term investment, CA$23 billion in labour income and CA$11 billion in tax revenue. The long-term economic impact of these potential mines could reach CA$800 billion over several decades of operation. Clearly, these projects represent a generational opportunity for British Columbians and all Canadians.

However, success isn't a given. The path to prosperity requires bold action from our governments, together with the mining industry, First Nations communities, labour and the public. British Columbia needs a more competitive fiscal and regulatory environment to close the competitiveness gap with other mining jurisdictions and attract the necessary capital investment to grow and maintain the sector. Governments also need to boost First Nations capacity funding to speed up permitting, foster decision making and advance First Nations participation in mining projects. Further, British Columbia requires strategic investments in electrification to make sure mines have timely access to clean electricity.

Without these measures, the critical minerals required to decarbonize our economy might remain in the ground, and the opportunity could be lost to other jurisdictions.

Yet over the past year, there have been developments to help advance critical minerals projects in British Columbia. The provincial government, for example, adjusted its new output-based carbon pricing system for large industrial emitters to provide a more competitive fiscal foundation for critical minerals development. This move will narrow the competitiveness gap between British Columbia and Ontario and Quebec by about 50%. However, more actions are needed to improve British Columbia’s overall competitiveness.

The BC government also introduced Phase 1 of its Critical Minerals Strategy, which contains policy initiatives to support the industry, including dedicating staff and resources to prioritize critical minerals projects. In addition, this strategy commits to optimizing an existing skills and training program to meet workers' and the critical minerals sector's skills and training needs, as well as support First Nations partnerships and participation in mining. The province recently announced a First Nations Equity Financing Framework, which will include equity loan guarantees of up to CA$1 billion for First Nations that are considering equity participation in mining and other projects.

Moreover, we’ve seen important early steps to expand electrification in British Columbia. BC Hydro is planning to increase its transmission capacity on the North Coast, where growth in liquified natural gas (LNG), port activity and critical minerals projects is boosting demand for clean energy. Working with the provincial government and First Nations communities, BC Hydro has issued its first call for new power in 15 years, aiming to increase supply by 5%, or approximately 3,000 gigawatt hours per year of electricity.

The federal Critical Minerals Strategy and recent budgets have established a solid road map and useful tax measures to help develop Canada’s critical minerals resources. However, new projects in downstream areas such as electric vehicle and battery manufacturing, with the help of generous financial incentives, have materialized faster than projects in upstream mineral extraction and processing. This is where the requisite feedstock and big economic opportunity are found.

The core challenge for the BC and Canadian mining industry remains lengthy and uncertain timelines for mine permitting and approvals. These continue to challenge investment decisions and slow project development.

The Government of Canada appears to be listening. In its 2024 budget, the federal government allocated CA$1.3 billion over six years to speed up the impact assessment process through a number of initiatives. Importantly, the government made the bold commitment to reduce the time it takes to complete the federal impact assessment and permitting processes to five years, down from the current 12 to 15-year period. At the same time, the 2024 budget announced a new CA$5 billion Indigenous Loan Guarantee Program for mining and other natural resource projects. This is good news.

But we're in a race. The United States and our other allies are actively securing new critical minerals supply chains to reduce dependence on Chinese and Russian supplies, while the pool of capital for mining is shrinking, fragmented and more risk-averse than in days past. New mines are large, high-risk capital projects—and many investors are seeking faster, more certain returns.

This is why we must move beyond planning and policy development. Decisive action and execution are required to make sure Canada is positioned as a leading global supplier of critical minerals where new projects have a timely and predictable pathway to development.