With massive growth expected in Canada’s mining sector, the 2012 Federal Budget provides incentives and opportunities for growth to this industry, which has long been recognized as a global leader. Strong commodity prices driven by growing demand has been creating opportunities for new mine development and major mine expansions. Traditional industries, like mining and forestry, continue to sustain the economy and provide jobs in many areas of the country.
With this year’s budget implementations, the mining industry will benefit through measures aimed at marketing Canadian products abroad and helping businesses expand and innovate, with aim at creating new jobs. As part of the job growth plan, the government has committed to opening eight new mines and expanding nine mines by 2015. The new budget has been estimated to increase new investment in Canada’s mining sector by $140 billion. The Mining Association of Canada’s president, Pierre Gratton, recently stated, “Canada is in global competition for mining investment and an effective and efficient regulatory regime can provide a competitive advantage over other jurisdictions. Legislative reforms announced in today’s budget promise to modernize Canada’s environmental review and permitting processes. This will accelerate investment, job growth and enhance Canada’s international competitiveness and position as a mining superpower.” Of particular note in this year’s budget is the push to further improvements to the Canadian Environmental Assessment Act, which is the legal basis for the federal environmental assessment process. Regulations under the Act are used to determine what, if any, environmental assessment is required. It also outlines and prescribes procedures for government departments and agencies to coordinate the environmental assessment process. The Regulations also prescribe the information that is to be included in a project description. Of special note is a commitment to introduce the concept of “equivalency” in federal environmental assessments, whereby the federal government can accept a comparable provincial environmental assessment as its own. This will eliminate the need for duplicative reviews for a single project, saving time and resources.
Another important measure outlined in this year’s budget is government’s commitment to set fixed timelines for project reviews and assessments. British Columbia Premier Christy Clark, in a recent interview, claimed the government had made progress in reducing the backlog of over 200 notice of work applications for mines, reducing the amount pending by more than half since September 2011. Their goal is to reduce this amount to less than 50 by September 2012. A decision was also made by the federal government to include the Mineral Exploration Tax Credit (METC) in the 2012 budget. For the past decade, Canada has captured the world’s largest percentage of global exploration investment, and the Mineral Exploration Tax Credit is one of the main reasons why. The 2012 budget also commits to a consistent and coordinated approach to Aboriginal consultation as a component of project reviews. In 2009, Canada passed its first mining legislation to introduce a dispute resolution process for Aboriginal-related consultation issues. This outlined consultation requirements, requires environmental rehabilitation, and introduces plans or permits for exploration activities. Since many Aboriginal communities in Canada are key partners with mining companies, the procedure outlined in this year’s budget serves to approach to contribute to more mutually-beneficial relationships between Aboriginal communities and mining companies.