Mineral exploration plays a key role in ensuring the long-term viability of Canada’s mining industry. It leads to the discovery and development of mineral deposits that may become future mines, creates jobs—often in remote and northern communities—and attracts significant investment.
What is mineral exploration?
Mineral exploration is the search for materials in the earth’s crust that appear in high enough concentrations and amounts, and that can be extracted and processed for profit.
Mineral exploration covers a wide range of objectives and activities which begins with the selection of a target area. The type of work carried out depends on the minerals being sought. Following promising clues that may lead to a discovery often requires substantial investment and years of work. Only a small number of such clues turn into discoveries, but not until drilling and rock excavation have more clearly defined the extent of the deposit and cost studies have concluded that profitable extraction is possible.
Mineral exploration usually continues after a mine has begun production, and can extend the initial planned mine life as additional mineral resources and reserves are defined.
Mineral exploration activities include:
- Exploration planning and regional reconnaissance surveys, done by conducting remote sensing, aerial photography, and airborne geophysical surveys
- Prospecting and ground surveys, accomplished through geological mapping, rock, soil, water and vegetation geochemical sampling, and geophysical surveys
- Verifying anomalies and showings by conducting trenching, drilling and other types of sampling
- Mineral deposit discovery and delimitation, accomplished by conducting stripping, trenching, mapping, sampling, drilling and down-hole geophysics
- Mineral deposit definition, achieved by carrying out detailed mapping, sampling and drilling on surface or from underground, mineralogy and mineral processing tests, and environmental and site surveys
- Project engineering, done by conducting pilot tests of processing methods, engineering design and planning, and risk analysis
- Project economics, accomplished through financial studies (prefeasibility studies) that include mine capital and operating cost estimations
- Feasibility studies and production decisions, accomplished through an exhaustive due diligence review of all data, interpretations, plans and estimates
Junior and senior companies conduct exploration
Mineral exploration in Canada is mostly carried out by Canadian junior and senior mining companies. Canada is well known for the high participation rate of junior mining companies, which usually have no operating revenue and rely on equity financing. They tend to be small, flexible, and specialize in higher-risk, early-stage exploration activities. While some junior companies may decide to develop a project on their own or with a partner, senior companies (producers) are traditionally most likely to bring a mine into production.
A smaller portion of exploration is done by foreign-based or state-controlled entities.
Most mineral rights are owned by the provincial or territorial governments
Mineral rights are owned by respective provincial or territorial governments, with the exception of Nunavut and the offshore, where the federal government holds the mineral rights. In some cases, Indigenous groups may own and administer mineral rights.
Canada benefits from a diversified mineral endowment
Along with a mineral endowment of the more traditional commodities such as gold, base metals, and diamonds, mineral exploration in Canada also includes commodities used in highly valued applications in both the clean technology and the information technology sectors—rare earth elements, graphite, lithium, and others.
Canada ranks first in the world
Canadian-headquartered companies account for the largest portion of global nonferrous mineral exploration budgets. Canada is also the world’s top destination for planned nonferrous mineral exploration spending.Footnote 1 Vancouver is home to the world’s largest cluster of exploration companies.
Incentives help mitigate the risks
The federal government and provinces/territories offer a variety of mining sector-specific fiscal measures, such as flow-through shares, to help mitigate the risks associated with mineral exploration.
Learn more about mining and mineral exploration taxation
Public geoscience helps make informed decisions
The federal, provincial and territorial governments provide geoscience in the form of geological maps, regional geophysical surveys and other scientific information. Government geoscience activities also generate geological information required for various public uses, such as studies related to land use and the environment, public health, infrastructure planning, national defence and sovereignty.
The industry relies on a strong equipment and service sector
Canadian cities provide regional bases for supporting exploration, mining and allied industries through specialized equipment and service suppliers. Even a large urban area such as Toronto is recognized as a global hub for mining and mineral exploration financing and legal services.
- Read the General Mineral Tenure Rules for Exploration and Development
- Learn about the Mineral Exploration Tax Credit (METC)
- Find out about the Generalized Model of Mineral Resource Development
- Learn about Aboriginal participation
- Read Mining and Exploration in Canada: An Investor’s Brief
- Find out more about sustainable mineral development
- Discover how NRCan collects, assesses and publishes mineral exploration statistics
- Get the facts about geology
- Find links to federal earth sciences programs
- Learn about mineral exploration and deposit appraisal expenditures in Canada (Information Bulletin)
- See a map of the top 100 exploration and deposit appraisal projects
- Download statistical data on Canada’s mineral exploration
- Read about Mineral Exploration, Deposit Appraisal, and Mine Complex Development Activity in Canada, 2010–2011
- Read the an Overview of Trends in Canadian Mineral Exploration report
- Learn about Canadian reserves of selected major metals
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