ANNOUNCES MEASURES TO CONTINUE ECONOMIC DEVELOPMENT IN CANADA’S NORTH
BAKER LAKE, NUNAVUT – Prime Minister Stephen Harper today toured Nunavut’s highly successful Meadowbank gold mine and pledged to continue economic development in Canada’s North.
“Our Government remains focused on the economy, job growth and expanding new opportunities from coast-to-coast-to-coast,” said the Prime Minister. “Canada’s North is full of economic potential and innovators continue to unlock development possibilities that bring with them real economic benefits and long-term jobs for local residents.”
The Prime Minister also announced support for the establishment of an office for the NWT & Nunavut Chamber of Mines in Iqaluit. The office will help serve the needs of the growing mining industry in the territory and promote the Nunavut mining industry around the world. The office will also promote job opportunities in the mining sector for students, and promote environmentally responsible development and growth of mining and mineral exploration.
The Prime Minister also highlighted that the Government’s Geo-mapping for Energy and Minerals (GEM) program is continuing to generate geophysical maps that are helping Canadian companies locate rich mineral deposits, which reduces exploration risks and costs and encourages economic development in the North. In the area around Baker Lake alone, the GEM project has released 33 new geophysical maps over the past 12 months, with more expected as ongoing field work is conducted over the summer.
Meadowbank Gold Mine
The Meadowbank gold mine, Nunavut's only operating mine, is owned and operated by Agnico-Eagle Mines Ltd. (AEM)
Since beginning commercial production in March 2010, the mine has been providing substantial economic benefits to local residents and businesses. In addition to providing many years of seasonal employment for residents of Baker Lake and other local communities, the mine also used northern based suppliers for 41% of the $1.26 billion expended on mine construction and operations between 2007 and 2010.
The mine has also provided significant benefits for the local Inuit communities. In addition to 39% of the mine’s permanent workforce being Inuit, the mining company pays royalties to Nunavut Tunngavik Inc. (the Inuit land claim organization in Nunavut) given that it is located on Inuit land. In 2010/11 the mine dispensed approximately $10 million in royalties to the Inuit.
The Federal Government has provided support to get the mine up and running. Several federal departments participated in the environmental and socio-economic assessment of the Meadowbank Project conducted by the Nunavut Impact Review Board. As well, the Government has supported the advancement of mineral exploration in Nunavut through many regional and detailed geological mapping and structural geology research projects.
Meadowbank is a good example of how government geoscience supports mineral exploration and development in the North. It also shows how the new generation of northern mines are bringing direct benefits to Inuit communities while ensuring the protection the environment.
The Meadowbank mine and its transportation infrastructure operate under strict environmental management and monitoring conditions.
Quick Facts on the Meadowbank Mine:
- Full-time AEM Employees (as of July 31, 2021): 769
- Inuit Full-time AEM Employees (as of July 31, 2021): 289
- Estimated mine life: 2010-2019
- Type of mine: open-pit mining
- Average Annual Gold Production (year 1-4): 400,000 ounces
- Total cash costs per ounce: 2011e - $700
- Open Pit Gold Reserves: 3.64 million ounces (34 million tonnes at 3.2 grams/tonne (g/t))
- Indicated resource: 1.4 million ounces (26 million tonnes at 1.7 g/t)
- Inferred resource: 0.7 million ounces (10 million tonnes at 2.2 g/t)
ESTABLISHING AN IQALUIT OFFICE FOR THE NWT & NUNAVUT CHAMBER OF MINES TO SUPPORT ECONOMIC DEVELOPMENT IN CANADA’S NORTH
The Government of Canada is committed to helping promote a stronger more dynamic economy for Northern families and businesses by enabling them to benefit from the abundant resources in the region.
In keeping with this objective, the Canadian Northern Economic Development Agency (CanNor) is investing $230,000 over three years to support the establishment of an office in Iqaluit for the NWT & Nunavut Chamber of Mines.
Nunavut has significant mining exploration and development potential and interest is growing every year. Establishing the Chamber of Mines office in Iqaluit will help serve the needs of the growing mining industry in the territory.
The Nunavut office will offer a variety of services to the mining industry and to Northerners. Responsibilities will include working with governments to create effective legislation regarding the mining and exploration industry and communicating opportunities and benefits of Nunavut’s mining industry to the public and media. As well, the Chamber office will work with the Government of Nunavut and Arctic College to promote job opportunities in the mining sector to students. The Chamber will play a key role in organizing and expanding the annual Nunavut Mining Symposium, and will attend national industry trade shows to promote Nunavut’s mining industry.
Created as a non-profit organization in 1999, the NWT & Nunavut Chamber of Mines serves mineral exploration companies operating in both territories. The Chamber seeks to encourage, assist and stimulate prosperous, orderly and environmentally responsible development and growth of mining and mineral exploration. The organization has over 900 members representing exploration, mining, consulting, and service and supply companies and individuals.
The Government of Nunavut and the Northwest Territories and Nunavut Chamber of Mines are contributing $330,000 and $268 000 respectively to this initiative.
Geo-mapping for Energy and Minerals
In 2008, Prime Minister Stephen Harper announced the Geo-mapping for Energy and Minerals program (GEM) to help Northerners capitalize on surging opportunities in the energy and mineral sectors and promote economic development in Canada’s North.
GEM is a five-year (2008-2013), $100-million geological mapping program administered by Natural Resources Canada’s Geological Survey of Canada. The program is designed to significantly advance and modernize geological knowledge in the North to support increased exploration for new resources. Scientific information gathered through GEM also further informs decisions on land use, such as the creation of parks and other protected areas.
The program benefits from an Advisory Group of Northerners, which includes representatives from provincial and territorial governments, the private sector and Aboriginal socio-economic development organizations.
Key activities of the GEM program consist of:
- Using state of the art geological science and technology and techniques in airborne geophysics, field data collection, and laboratory analysis to generate new maps, data, reports and research papers. The high-resolution geological maps being produced by the program are allowing governments and private industry to make informed decisions on the development of new energy and mineral resources, bringing Canada one step closer to unlocking the full mineral potential of our northern regions;
- Making collected research and maps available via the Internet to decision-makers ranging from government and community agencies, to industry investors and land-use planners; and,
- Engaging communities and local governments to participate in field projects.
The program is significantly increasing publicly available geoscience information about Canada’s North – including the identification of areas of high potential for gold, nickel, platinum-group elements, rare metals, base metals and diamonds. This information is increasingly being used by the private sector in Canada and around the world, given it helps mining exploration companies reduce their risks and exploration costs, which encourages economic development and creates jobs.
GEM is also helping to ensure that jobs are created in rural and remote communities in Canada’s North through resource exploration and development. For example, companies which make investment decisions on where to look for resource deposits will hire local people and provide them with training and employment opportunities.
Currently in the fourth year of its five-year mandate (2008–2013), GEM to date has undertaken 20 new field projects in the three northern territories and the northern parts of six provinces: Ontario, Quebec, British Columbia, Saskatchewan, Manitoba and Newfoundland and Labrador. Twenty-four regional geophysical surveys have been completed, 341 open file releases of new geoscience maps and data have been published on the Natural Resources Canada Website, and more than 100 technical information sessions have been delivered at venues frequented by industry, government and NGOs.
GEM has successfully prompted a number of new private sector activities in the North, including:
- A $50-million Chinese-Canadian joint venture to advance development of an iron ore deposit on the Melville Peninsula, Nunavut;
- $3 million in diamond exploration activities on Boothia Peninsula, Nunavut;
- Staking of 114 diamond prospecting permits on southeast Baffin, Nunavut; and
- The discovery of significant copper-gold-silver deposits in the Yukon.
It has also delivered a modern, quantitative estimate of the undiscovered hydrocarbon potential in the MacKenzie Valley corridor. GEM estimates that 4.8 billion barrels of oil, and 32.6 trillion cubic feet of natural gas have yet to be discovered.
Over the next 10-15 years, GEM is expected to generate more than $500 million in economic activity through private sector exploration for new energy and mineral resources.
GEM's maps and technical reports are available for download, free of charge, through Natural Resources Canada's Geoscience Data Repository at www.gdr.nrcan.gc.ca . Industry and interested parties regularly access maps and technical reports online through the data repository.
MINERAL EXPLORATION TAX CREDIT
The Mineral Exploration Tax Credit helps companies raise capital for mining exploration by providing a tax incentive, stimulating investor interest in flow-through shares issued to finance exploration.
Flow-through shares allow companies to renounce, or “flow-through,” tax expenses associated with their Canadian exploration activities to investors, who can deduct the expenses from their taxable income. The mineral exploration tax credit is an additional benefit, available to individuals who invest in flow-through shares, equal to 15 percent of Canadian mineral exploration expenses. These shares are particularly beneficial to start-up corporations that do not have enough taxable income to benefit from tax deductions themselves.
The Government introduced the mineral exploration tax credit in October 2000 as a temporary measure to moderate the impact of the global downturn in exploration activity on mining communities across Canada. Originally scheduled to expire on December 31, 2003, the expiry date was extended in Budgets 2003, 2004, and 2006 through 2010.
In support of the economic recovery, Budget 2011 extends the eligibility for the mineral exploration tax credit for one more year, to flow-through share agreements entered into on or before March 31, 2012. This extension will help companies continue to raise capital for mineral exploration, sustain and create jobs in the Canadian mining industry and protect mining communities affected by long-term challenges.