Article content
Canada is home to five of the top 10 most attractive mining jurisdictions in the world, but it has plenty of room to improve in terms of regulatory policies, according to a new survey conducted by the Fraser Institute.
Utah and Nevada topped the latest ranking, with Saskatchewan, Quebec, Manitoba, Newfoundland and Labrador and Ontario all in the top 10. Saskatchewan was No. 3 for the second year in a row.
Article content
The analysis uses a combination of a region’s mineral potential and the policies it has in place to attract miners and is based on a total of 293 responses and 86 jurisdictions.
These two factors vary across regions in Canada, the study said. For example, while Yukon and the Northwest Territories are ranked within the top 10 spots for their mineral endowments, they rank No. 28 and No. 45, respectively, on their regulatory policies.
“This means that these two territories have failed to capitalize on their strong mineral endowment due to a lack of a solid policy environment,” said Elmira Aliakbari, a director at the Fraser Institute’s Centre for Natural Resources and one of the two authors of the study.
British Columbia and Nova Scotia are two other examples where the regulatory environment lets them down, coming in at No. 32 and No. 36, respectively, on that measure.
Uncertainty around protected areas and disputed land claims are major areas of concern for Canadian jurisdictions, the report said. For example, more than half of the respondents from B.C., Ontario and Nova Scotia indicated that uncertainty concerning disputed land claims was a deterrent to investment, compared with only nine per cent in Nevada and zero per cent in Utah.
Article content
Another key barrier for several Canadian jurisdictions is the uncertainty surrounding environmental regulations. Aliaakbari said there is “significant room” for policy improvement in several Canadian jurisdictions.
Canada’s mining industry plays a key role in the economy. It contributed about $125 billion to the country’s gross domestic product in 2021, or about five per cent of the total. The sector is also responsible for about 660,000 jobs and is the largest private-sector employer of Indigenous peoples, according to the Mining Association of Canada.
The mining sector is also expected to play a big role in the country’s gradual transition away from fossil fuels. In recent years, there has been a greater emphasis on miners to look for metals such as lithium, copper and nickel since they are required to build batteries, as opposed to just gold and silver. Canada has also agreed to invest billions of dollars in building battery plants to power electric vehicles.
The Fraser Institute’s survey also analyzes approval times for mining permits in Canada, the United States, Australia and Europe. About one-third of respondents from Quebec, Ontario and Newfoundland and Labrador said permit approval times had shortened, but Canadian respondents generally indicated that such times are worsening.
Article content
Furthermore, the study analyzes how transparent the granting of exploration permits is — essentially whether miners understand what the rules are, how they are applied or whether political interference and corruption can enter the process.
An average of 38 per cent of Canadian respondents said that a lack of transparency deters investment in this country, compared to 37 per cent in Australia, 32 per cent in the U.S. and 11 per cent in Northern Europe, according to the study.
In addition, 77 per cent of respondents in Canada said they were either confident or highly confident that the necessary permits for their mine would be granted, but that percentage is lower than in the U.S., Australia and Northern Europe.
• Email: nkarim@postmedia.com
Bookmark our website and support our journalism: Don’t miss the business news you need to know — add financialpost.com to your bookmarks and sign up for our newsletters here.
Share this article in your social network