News from the North: 22 September 2021

News from the North

22nd September 2021

As I’m sure you’ve already heard, Justin Trudeau’s Liberal Party has been re-elected in Canada, although he hasn’t secured a parliamentary majority so all the news below should be read with the caveat that the party’s ability to deliver on its promises may be somewhat hampered by that.  The Canadian mining landscape will be of great interest to many of you reading this newsletter, so I thought I’d spend a bit of time looking at it today.

Justin's back

In general, Canadian miners seem happy with the re-election of the Liberals.  The strongest signal came from the Mining Association of Canada (MAC), which put out a press release that you can read here.  Pierre Gratton, the CEO of MAC, emphasized that mining is a crucial industry for Canada, representing $107 billion revenue for the government and 19% of the country’s exports. That press release also says that 1 in 26 Canadian jobs are in the mining industry, which is rather amazing for an advanced economy, and would mean that there is a significant ongoing incentive for the ruling party to take the industry’s needs into account in a wide variety of policy decisions.

The Liberals have made concrete plans to assist the mining industry in their policy platform.  Among the most significant is their proposal for a doubling of the Mineral Exploration Tax Credit for elements on Canada’s list of 31 critical metals (and helium), most of which are necessary for green technology like renewable power and electric vehicles.  If you’re interested in exactly which elements are included, you can find the complete list and other information here.  Further to this, in June 2019 the government under Trudeau started the Mines to Mobility report, whose final version you can read here, which outlined a concrete strategy to increase investment in electric vehicle battery production in Canada, at all stages from resource extraction to final product.  The Liberals committed to reinforce that strategy during the election campaign, which was welcome news for miners in the EV metals sector. In addition to these moves, the re-elected party made commitments to invest in infrastructure, including internet and disaster warning, in the under-served north of the country where quite a few mining areas are located.

The future is bright for diversified Canadian juniors like Mountain Boy (TSXV:MTB), who are peering into the future with new discoveries

Another thing that was emphasised in the MAC release was the environmental credentials of the Canadian sector compared to other countries’.  There is clear motivation from MAC to position Canada as the greenest possible supplier of critical metals and the raw materials for green energy.  From a greenhouse gas perspective, 82% of Canada’s energy comes from non-emitting sources, which is very competitive with comparable mining jurisdictions around the world, and ideally manufacturers in the renewables revolution would take the environmental credentials of their materials sources into account when trumpeting the benefits of their products.  If they did, Canada would certainly be at the head of the pack in this regard.

Juniors like Conquest Resources (TSXV:CQR) can be confident of a friendly and workable mining environment under the Liberals

One of the driving forces behind Canadian mining’s generally-good environmental credentials is the Towards Sustainable Mining (TSM) initiative, which is binding for all MAC members.  Here is a very useful primer if you’re interested in finding out more.  Basically, TSM requires members to self-report every year and submit to independent verification every three years on a wide range of environmental, social and governance (ESG) issues.  These include indigenous and local community engagement, climate change and biodiversity consciousness, and health and safety principles for workers.  Other jurisdictions around the world have begun looking to the TSM for guidance in developing their own policies and approaches to ESG, especially in comparable developed economies where the implementation of such initiatives is probably more feasible.  While, yes, binding guidelines like the TSM create additional work for mining companies, MAC and the Canadian mining industry at large have clearly recognised the benefits and are positioning themselves to use it as a powerful marketing tool.  In a world where human rights and environmental violations in mining keep attracting attention, not to mention the simultaneous impact of the industry on greenhouse gas emissions and its absolute importance in mitigating them, having rules like the TSM will allow the industry in countries like Canada to sell their products to the increasing number of buyers who care about the ethical standards of their suppliers.  In all, it seems Canadian mining is well positioned for the near and medium-term future, and Trudeau and the Liberals will hopefully deliver on their wise commitments to balance the crucial mining industry with the green and safe future.

Around the Traps

Goldplay Mining (TSXV:AUC, OTCQB:AUCCF, FRA:9FY) keeps on making waves in the Canadian junior market, having yesterday announced its listing on the OTCQB.  President and CEO Catalin Kilofliski said that the listing was in line with the company’s strong growth strategy.  This comes on the heels of Goldplay’s announcement of major new Canadian acquisitions at the end of August. You can read the listing news release here.

One of Goldplay's expanding stable of projects is Scottie West in BC

Canadian giant Teck Resources (TSX:TECK.A,TECK.B, NYSE:TCK) are having a rough time of it at the moment.  Wildfires in British Columbia have forced them to revise down estimates of zinc production for the year on the basis of a shutdown at their Trail operations, and they are still having trouble landing a deal to spin off their coal assets. This article provides a good overview of the major recent news from the company.

The Visual Capitalist produces some really great infographics, and this week they have this graphic and article about mining in British Columbia.  It’s a really great overview for anyone who is looking to learn the basics of mining in the region, so if you know someone who needs a primer, send this through to them!

That’s all from me for this Wednesday, I’ll be back in touch on Friday with the Spotlight Round-up for the week!

- Jane Lockwood