ARCHIVED - Canada Mining Innovation Council "Signature Event" - Toronto, Ontario

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2012/16

Notes for Remarks

by

The Honourable Joe Oliver
Minister of Natural Resources

to the

Canada Mining Innovation Council

"Signature Event"

January 31, 2012
Toronto, Ontario

Introduction

Thank you very much to the Canada Mining Innovation Council for the opportunity to be part of the discussion this morning.

It is an honour to be here today on behalf of Prime Minister, Stephen Harper.

As Canada’s Minister responsible for mining, I take pride in being part of this network of industry, government and academic leaders who are working together to strengthen Canada’s role as a global leader in mining innovation.

And I'm sure my panellists will agree, it's not possible to overstate the importance of innovation — not just in exploration and mining, but in just about everything we do.

Whether it's putting out a better product or developing a better process, innovation is the key to our national success, to economic growth and the quality of life.

The Harper Government supports innovation across all sectors — from forestry to energy — with a sharp focus on collaboration to ensure our research efforts match the unique needs of each sector, including mines and minerals.

We partner with over 200 mining stakeholders to move our projects from the R&D phase to implementation and uptake by the industry.

It's clear that the minerals and metals sector – from exploration to mining to processing and related services – understands the value and critical importance of collaboration to ensure we are all moving in the same direction.

It's been less than three years since CMIC was incorporated. Since that time, when Natural Resources Canada was one of a handful of founding partners, membership has grown dramatically — from fewer than a dozen a year ago to nearly 80 today.

Most of our major mining companies are represented. We have the key mining engineering research universities. And provincial governments are also on board. Thank you.

And that is an outstanding response, and it tells me that CMIC is on the right track to meeting its goals of bringing together the people and organizations we need to work together to ensure this industry continues to be a world leader in innovation, and a cornerstone of Canada's economy.

Importance of Exploration and Mining

And that's no exaggeration. It's something I communicate to Canadians wherever I go. It's important that Canadians understand just what this industry means to our economy and the quality of life we enjoy in this country.

Canadian exploration and mining companies operate in more than a 100 countries, with total assets of $129 billion.1

Canadian-listed companies are responsible for as much as one-half of all global equity raised for mineral development. In fact, almost 60 percent of the world’s publicly-listed mining companies list in Canada on Toronto's TMX.

Here in Canada, there are more than 200 active mines. Mineral production in 2010 alone totalled more than $41 billion.

Mining and mineral processing are responsible for the jobs of well over 300,000 Canadians, and thousands more work in related industries. The mining sector is an important employer of Aboriginal Canadians, particularly in Canada's North.  

On top of that, this industry contributes roughly $1 billion in taxes and royalties to governments every year — funds that support everything from education to health care.2

It's pretty clear the industry is performing very well, but we know we can't afford to stand still. The competition is getting tougher all the time.

Regulatory improvement

Our government's collaboration on innovation extends beyond technological issues because maintaining our resource sector's competitive edge also requires innovation in policy.

Over the next 10 years, we can see the potential for $500 billion in new investment in major resource projects in this country — of which $92 billion is projected to be in mining.

But we can't take these investments and the thousands of jobs they represent for granted.

The market for capital is just as competitive as the market for minerals.

Our government is committed to making Canada one of the best places in the world to invest, and we are doing exactly that through Canada’s Economic Action Plan.

We've put the key ingredients in place: competitive taxes, a stable political environment, and non-discriminatory policies.

We've put Canada at or near the top in just about every category. So it wasn’t a surprise that Forbes magazine recently named Canada as the best place in the world to invest and to do business.

But when it comes to major resource projects, there's no question that we need to bring our regulatory regime up to the same competitive standard.

Australia — our biggest competitor in the uranium business — recently approved a major uranium mine expansion in less than two years. By comparison, the Joslyn North oil sands mine took nearly six years to wind its way through our system of regulatory approval. We can't afford to give our competitors that kind of head start.

We are making progress and have taken important steps to getting the federal house in order.

The Major Projects Management Office at Natural Resources Canada and targeted changes to the Canadian Environmental Assessment Act begin to address some of the key problems.

I’ve heard from mining industry representatives that we are headed in the right direction, but we still have a long way to go to be really competitive.

The current system remains a patchwork of overlap, duplication and needless complexity. Together, it leads to unnecessary and unpredictable delays, tarnishing Canada's reputation as an attractive place to do business.

We need a system that is fair and efficient and considers the viewpoints of all stakeholders, including Aboriginal communities. We need a system that reviews the evidence dispassionately, and then draws objective conclusions based on science and facts — all to ensure informed decision-making.

We cannot afford a system that could be highjacked by groups without a direct say but with radical agendas. 

We need a regime that's truly competitive, but we need to work together to achieve that because this is not up to the federal government alone.

Our provincial and territorial counterparts agree. When we met in Kananaskis last July, we reached broad agreement on the need to step up our cooperation on regulatory improvements. The ultimate goal is simple: one project, one review, in a clearly defined time period.

Ontario’s Ring of Fire

In a fundamental way, the regulatory system, both north and south of 60, will determine whether Canada will be successful in attracting investment, developing resources, building new infrastructure and supporting our manufacturing and service sectors while also protecting the environment. The potential economic benefit for individuals and their families in this room, this city, this province and this country cannot be overstated.

A new regulatory system will mean great things for Ontario, a province that is rich in minerals and metals resources. 

In fact, there’s a very good example in northern Ontario, as you know, which illustrates the complexities in approving projects, so I’d like to take a moment talking about the Ring of Fire, a relatively new mining region in the James Bay lowlands.

This area is attracting significant investment, and it could make Canada a major producer of chromite and ferrochromium for value-added products such as stainless steel and specialized alloys. The region could also potentially replenish Canada’s dwindling reserves of nickel and copper.

For Ontario, this area is of strategic importance since it could open up the entire region to greater prosperity. It has significant potential to create wealth through taxes and royalties for government.

It creates jobs and skills development for the 31 local Aboriginal communities and leads to improvements to infrastructure.

Twenty-six exploration companies are currently working in this area, and they have mineral claims covering almost 500,000 hectares.

Private sector estimates indicate that the chromite resources there could be worth as much as $50 billion. And there are estimates for deposits of base-metals and platinum-group metals worth as much as $10 billion. There may also be deposits of gold, iron and other minerals in the region. 

I don’t have to tell you that the James Bay is a remote region. There are no roads, no railway and no power lines. So, everything needed to support development must go through approvals —and then it must be built.

All this, of course, means thousands of jobs and the good news is investors are on board.

Currently, two projects have been proposed that are expected to create up to 2,000 jobs at any given time. 

The Cliffs Chromite Project is proposing to build a 30-year open pit and underground chromite mine with ore processing capabilities.

Noront’s Eagle’s Nest Project is proposing a 10-year nickel-copper and platinum-group metals mine, also on-site processing included.

Both projects are currently undergoing environmental assessment.

It is my hope that these projects will pass through our federal and provincial regulatory systems and the processes needed and it will do so smoothly — but as I said earlier, the track record on major projects shows room for improvement. 

We have to wonder how many would-be investors have seen Canada’s regulatory process and then decided to put their money elsewhere, somewhere where their money could get to work a little faster.  So we need to get the fundamentals right. 

We need to bring our regulatory regime up to a competitive standard. We have to ensure proper and thorough environmental reviews of major projects but we must put an end to unreasonable delays — delays that can jeopardize the viability of projects and harm our reputation as an attractive place to do business.

We will continue to work with the provinces, with the territories and with industry on ways to reduce duplication, tighten timelines, and make other improvements to the regulatory processes for resource projects.

GoC Support for Innovation

To stay at the forefront, we obviously need to develop technologies and approaches that will assure Canada's industry can continue to strengthen its reputation as an innovative nation.

Our support for CMIC and the collaboration for innovation it promotes is a big part of our engagement.

And that’s why I'm gratified by the support and partnership the industry has shown for the new Corporate Social Responsibility Strategy we launched in 2009. Canada's industry understands the importance of setting an example for social and environmental responsibility, and we're happy to support and work with you in advancing those efforts.

The Canadian International Institute for Extractive Industries and Development, which Prime Minister Harper announced last fall, will enable us to expand that work. The Institute is a vehicle for us to collaborate with industry and other organizations in support of sustainable resource management in developing countries.

Our Green Mining Initiative is perfectly aligned with CMIC's commitment to environmental stewardship, and CMIC has been a key supporter — co-chairing the Advisory Committee that guides the evolution of the initiative.

Through the Green Mining Initiative, we're collaborating on a number of innovative projects, in line with CMIC's own research priorities.

In extraction, for example, we're experimenting with heat as an alternative to explosives to free minerals from rock, dramatically reducing the amount of waste that has to be hauled to the surface, offering both economic and environmental benefits.

On the processing front, we're looking at enhanced metal recovery techniques, such as the CANMET Enhanced Leaching Process for recovering precious metals. Companies using this new process have reportedly experienced productivity gains totalling $28 million.

In energy, experts from our CANMET Mining and Mineral Sciences labs have worked closely with industry partners and with CMIC to demonstrate the benefits of ventilation on demand. It's estimated this kind of automated ventilation system could reduce energy costs for a large underground mine by as much as $4 million a year.

We're working with industry on tailings management, from closure strategies to waste management and disposal.

In addition, the tailings management research now being led by a consortium of oil sands companies, and supported by CMIC, is an extension of the work done by our researchers at the CANMET energy lab in Devon, Alberta.

Just yesterday, GMI sponsored a workshop here in Toronto to look at regulatory barriers to the adoption of innovative technologies in the mining sector.

Our CANMET Materials Technology Labs in Calgary and Hamilton operate under a similar mandate to collaborate with industry and academia to focus their work on technologies to improve all aspects of producing and using value-added products derived from metals and minerals, including pipeline integrity.

We've also worked with CMIC to ensure our investments in geosciences complement and cooperate with the industry's own efforts in exploration.

As you know, there is huge potential for resource development North of 60, and the number of projects is growing quickly.

We're putting $100 million over five years into our Geo-mapping for Energy and Minerals initiative — GEM for short. This investment is expanding and modernizing our geoscience knowledge base, with particular emphasis on the North.

This new knowledge enables industry to be more effective in exploration efforts and so lays the foundation for increased economic development in the North.

It will also enable northerners to make informed decisions about their future and their economy and their society.

To date, GEM has completed three successful field seasons with a total of 20 projects in all three territories, and the northern parts of six provinces.

Twenty-four regional geophysical surveys have been completed, 454 open file releases of new geoscience maps and data have been published on the Natural Resources Canada website, and more than 576 technical information sessions have been delivered at venues, like last week’s Mineral Exploration RoundUp in Vancouver.

These products identify areas of high potential for gold, nickel, platinum-group elements, rare metals, base metals and diamonds, which industry has begun to follow up and target.

Most new discoveries will likely be in the North and other remote areas. More and more, deposits will be found at depth, not at the surface.

Last year, we committed a further $25 million to our national Targeted Geoscience Initiative — the TGI.

In TGI-4, for example, we are working with CMIC, with their Exploration Innovation Consortium to develop complementary programs aimed at fostering innovative ways to explore for deep mineral deposits. These are the most likely sources of Canada’s future mineral wealth.

It is no accident that you can draw a direct line from GEM, TGI and GMI, and the other initiatives that I've mentioned to the research priorities set out by CMIC. We are listening and we are committed to a productive collaboration with provinces and territories, industry, and academia.

Conclusion

We see where the great potential for growth in the sector lies, and we see some significant challenges, such as finding and extracting deposits buried deep underground and developing the resource potential in the harsh yet sensitive environment of the North.

We will have to continue to innovate together to address the regulatory, physical, financial, and environmental challenges involved in developing this next generation of resources for the benefit of all Canadians.

From improving the regulatory environment, to corporate social responsibility, to the development and adoption of new technologies and processes, our Government is committed to working with the sector to contribute to its continued growth, success and global competitiveness.

Our ongoing support for and participation in CMIC is an important part of our commitment to the sector. In an important way, we are ensuring that your priorities will continue to be our priorities.

It’s the framework and the mechanism through which we are strengthening the collaboration among government, academia, and industry — the collaboration we need to ensure Canada continues to be synonymous with exploration and mining excellence.

Thank you so much for your attention, and please accept my best wishes for a very successful day. Thank you.


1 Source: Natural Resources Canada compilation from company annual reports - Reference year 2010

2 Source: ENTRANS Policy Research Group report to the Mining Association of Canada.