Minerals Industry Support for Bill C-47
Presentation to:
The Standing Committee on Aboriginal Affairs and Northern Development
February 5, 2013
Introductions
• Industry Association Representatives
– Nadim Kara, Prospectors & Developers Association of
Canada
– Tom Hoefer, Executive Director, NWT & Nunavut Chamber
of Mines
• We are here to support Bill C-47, with:
– Cover letter for NUPPAA and NWTSRBA
– More detailed written brief for NUPPAA
– Deck with some industry background
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Mining’s importance to the North
• Mining is the largest private
sector contributor in the North
• Its direct contribution exceeds
all other private sectors
• It also contributes to other
sectors, eg, real estate,
transportation and
construction.
• Nunavut’s one mine is already
contributing ~ 15% of GDP
NWT GDP (2009)
Other
27%
Mining
29%
Public Admin
12%
Oil & Gas
4%
Construction
9%
Real Estate
12%
Transportation
7%
3
Mines create huge value
NWT, Nunavut and Yukon Mining Production
$2,500
NWT
Nunavut
$2,000
$C Millions
$1,667
$2,045
$1,831
$1,790
Yukon
$2,144
$2,123
$2,112
$1,638
$1,507
$1,500
$1,000
$874
$779
$653
$500
$349
$682
$385
$321
$317
$272
$35
$35
$4
$32
$35
$13
$0
2003
2004
2005
2006
2007
2008
2009
$0
1999
2000
2001
2002
2010
$414
2011(p)
Natural Resources Canada – March 2012
• World class diamond mines are a huge contributor to the NWT
• Nunavut’s industry has the potential to match or exceed NWT
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Value translates to huge community benefits
• From 1998 – 2010, diamond mines contributed:
– More than 17,000 person years northern employment
• Nearly 9,000 (more than 50%) Aboriginal
– Over $8.5 billion in northern business
• Nearly $4 billion is Aboriginal
• Nunavut’s gold mine also making high contributions
• Mining is the largest employer of Aboriginal people
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Huge Aboriginal business success
• Diamonds helped create many new Aboriginal companies
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Ekati Services
I&D Management Services Ltd.
Tli Cho Logistics
Tli Cho Landtran
Tli Cho Cement
Tli Cho Air
Denesoline Western Explosives
Metcon
Tli Cho Explosives
Kete Whii Ltd.
Kete Whii Procon
Sodexho Alliance
Exploration Medical Services
Kitikmeot Cementation
Lac De Gras Constructors
Nishi Khon SNC Lavalin Inc.
North Slave Logistics
Nuna Logistics
SecureCheck
Lac De Gras Constructors
Nishi Khon / SNC Lavalin Inc.
A.T.B. Construction
Bouwa Whee Catering
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Det'on Cho DNX
Det'on Cho Earth Energy
Det'on Cho Foraco
Det'on Cho Hazco
Det'on Cho Nahanni
Construction
Det'on Cho New North
Det'on Cho NUNA
Det'on Cho Pure Earth Elements
Environmental Solutions
Det'on Cho Scarlet Security
Det'on Cho Stantec
Det'on Cho Training and
Conference Centre
Det’on Cho Logistics
Det’on Cho Medic North
Det’on Cho Mining Supplies
DICAN / ADG
Kete Whii / Ledcor
Kete Whii / Procon
Trinity Helicopters
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Akaitcho Helicopters
Dene-Emco Ltd.
Denesoline/Aboriginal
Engineering Ltd.
Denesoline/Air Tindi Joint
Venture
Denesoline/Arcan Constructio
Denesoline/De Beers Labour
Contract
Denesoline/Discovery Mining
Services – Logistics Expediting
Denesoline/Deton Cho/Procon
Denesoline/Deton Cho/Ledcor
Denesoline/Dyno Nobel
Denesoline/ESS Compass
Denesoline/McCaw Drilling and
Blasting
Denesoline/Nuna Logistics
Denesoline/Tlicho Logistics
Lutsel K’e Air Services
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Corporate and Mining Taxes
Diamond Mining Taxes
$700
$600
$C millions
$500
Mining royalties
NWT Corporate Taxes
Federal Corporate Taxes
$400
$300
$200
$100
$0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Source: GNWT – ITI Economic Model
7
Various additional mining benefits
• Fuel & Property taxes paid to GNWT
Tax
Already paid
Still to pay
Total
Fuel Taxes
$ 77 million
$ 68 million
$145 million
Property Taxes
$123 million
$260 million
$383 million
Total
$200 million
$328 million
$528 million
• $34 million in Resource Royalty sharing with settled
Aboriginal claimants since 2001 (devolution promises more)
Claimant Group
Gwich’in
Diamond Royalty share
$ 11 million
Sahtu
$ 10.8 million
Tlicho
$12.8 million
8
Unfortunately mines don’t last forever
• Current NWT and Nunavut mine lives
Mining Operations
1997
2000
2003 2006
2009
2012
2015
2018
2021 2024
2027
2030
Ekati
Diavik
Snap Lake
Cantung
Meadowbank
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Advanced projects could become new mines
Izok
(base metals)
Selwyn
(base metals)
Ulu
(gold)
Hackett River Hope Bay
(base metals)
(gold)
High Lake
(base metals)
Mary River
(iron)
Courageous
(gold)
Roche Bay
(iron)
NICO
(gold,cobalt, bismuth)
Chidliak
(diamonds)
Prairie Creek
(base metals, silver)
YK Gold
(gold)
Pine Point
(base metals)
Gahcho Kue
(diamonds)
Nechalacho
(rare earths)
Committee Bay
(gold)
Meliadine
Kiggavik
(gold)
(uranium)
Back River
(gold)
Lupin Jericho
(gold) (diamonds)
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Not slam dunks, but good potential for new mines
2011 2013 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039
Nunavut Projects
NWT Projects
Jericho
Izok & High Lake
Lupin & Ulu Gold
Hope Bay
Back River
Hackett
Kiggavik
Meliadine
Mary River
Roche Bay
Gahcho Kue
NICO
Pine Point
Nechalacho
Yellowknife Gold
Prairie Creek
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NWT exploration is not what it could be
NWT, Nunavut and Yukon Mineral Exploration
$600
$500
NWT
Nunavut
Yukon
$C Millions
$400
$300
$200
$100
$0
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
NRCan – November 2012
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NWT languishing – should have similar investment levels as NU and Yukon.
In the face of strong global “boom”, our actions created a “bust” in the NWT.
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Canadian Share of Exploration
NWT & NU as % of Total Canadian Mineral Exploration
20
% of Total Canadian Spending
18
16
14
12
10
8
6
Nunavut
4
NWT
2
0
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
NRCan – November 2012
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Legislative uncertainty in the NWT has created Investment decline. We need
to take actions to create a real turnaround.
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Industry support for Bill C-47
• We support the enactment of the NWTSRBA
– Provides a “court of last resort” to help deal with land use
conflicts
– Important to fulfil land claim obligations
– Readies legislative framework for devolution
• We support the enactment of NUPPAA with six
amendments
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Amending NUPPAA will add balance
Economic
Social
Environmental
The Sustainable Development Triangle
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NUPPAA: Timelines
• Timelines and Timeframes:
– We strongly support establishing an environmental and
socio-economic review & assessment process of 24 months
– Good for investment, and supports Nunavut’s unique
logistical challenges with seasonal “windows of
opportunity” for construction
– Further refinements can be made to various open ended
timelines, eg, clauses 92(4), 110, 112(9), 120(8) & 131.
• Recommend: further review of timelines in order to verify
that they will consistently achieve the federal government’s
objective of not more than 24 months to complete reviews
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NUPPAA: Schedule 3 Exemptions Incomplete
• Schedule 3 – Classes of Works and Undertakings Exempt from
Screening
– Schedule 12-1 of the Nunavut Land Claims Agreement authorizes NIRB
and the Minister to agree on additional classes of activities and projects
that are exempt from screening
– If the Minister and NIRB have made any agreements of this kind,
Schedule 3 should list the exempted works and activities
– It is important for Schedule 3 to be “populated” in the final version of
the Act so that potential exemptions are clearly set out
• Recommend: Schedule 3 be completed and included in the
final version of NUPPAA ultimately proclaimed into law.
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NUPPAA: Minor Variances
• Minor Variances:
– Minor variances provide a flexible and adaptive approach
to projects that, strictly speaking, may not entirely
conform – GOOD
– HOWEVER, process for dealing with minor variances is
quite complex
– Recommend Commission be authorized to grant or deny
minor variances.
• Recommend: NUPPAA be amended by deleting subsections
81(3), 81(4) & 81(5) and renumbering subsection 81(6) as
subsection 81(3).
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NUPPAA: Offences
• Offences under Land Use Plans:
– Inappropriate, unnecessary and unorthodox to create
offences under land use plans
– Offences also not contemplated by the Nunavut Land
Claims Agreement.
– Offences are more appropriate under the permits issued
by regulators, permits that require compliance
• Recommend: NUPPAA be amended by deleting
subsection 48(4) along with the references to that
provision in subsection 69(1) and paragraph 74(f).
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NUPPAA: “Grandfathering”
• Retroactive Application of New or Amended Land
Use Plans:
– Billion dollar mine investments are captive to their mineral
deposits, and cannot move if rules are changed
– Current NUPPAA has complex, ambiguous & potentially
contradictory wording on grandfathering
• Recommend: NUPPAA clearly provide that new or amended
land use plans do not apply to licences, permits or other
authorizations required for projects after their original
submission or approval; or where projects have been
suspended or works will be rebuilt within a period of less
than five years after their original approval.
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NUPPAA: 5-Year Review
• Recommend 5-year Review
– While we strive for perfection, it is virtually inevitable that
further refinements and adjustments will be necessary.
– 5-Year Review currently underway under the Yukon
Environmental and Socio-economic Assessment Act
– Could have resolved MVRMA challenges sooner
• Recommend: NUPPAA be amended to provide that the
legislation must undergo a comprehensive review
initiated 5 years after proclaimed into force.
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Conclusion
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Mining is the North’s economic advantage
Mining is creating significant community benefits
We must sustain and grow these benefits
NUPPAA and NWTSRBA can add to a stronger, more
certain, and beneficial minerals industry for
northerners and Canada
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Why it matters
Courtesy Diavik Diamond Mines Inc.
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