Evidence of meeting #12 for Natural Resources in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was mine.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Ramsey Hart  Co-manager, Canada Program, MiningWatch Canada
Pierre Gratton  President and Chief Executive Officer, Mining Association of Canada
Rick Meyers  Vice-President, Technical and Northern Affairs, Mining Association of Canada

3:35 p.m.

Conservative

The Chair Conservative Leon Benoit

Good afternoon, everyone.

We're here today to continue our study of resource development in northern Canada.

Before I get to the witnesses, though, I have a short item for the committee to deal with. Apparently the Norwegian delegation, which will follow in an informal meeting following this one-hour meeting we have today, has indicated they will present a gift, in which case we should reciprocate. To do that, we have to pass a motion to allow the clerk to officially buy this gift to reciprocate.

Is it agreed that we do that?

Mr. Trost, don't be difficult, although why would I expect anything different?

Mr. Trost, go ahead, please.

3:35 p.m.

Conservative

Bradley Trost Conservative Saskatoon—Humboldt, SK

Thank you.

The chair keeps getting gifts. This is amazing.

3:35 p.m.

Conservative

The Chair Conservative Leon Benoit

It is amazing, and thank you for your agreement to this.

(Motion agreed to)

Now let's get to the witnesses here today.

We have with us today, from MiningWatch Canada, Ramsey Hart, co-manager, Canada Program. Welcome, Mr. Hart.

3:35 p.m.

Ramsey Hart Co-manager, Canada Program, MiningWatch Canada

Thank you.

3:35 p.m.

Conservative

The Chair Conservative Leon Benoit

And from the Mining Association of Canada is Pierre Gratton, president and chief executive officer.

Mr. Meyers, are you with the Mining Association of Canada as well? Very good.

We'll have the presentations today of 10 minutes or less, and preferably less,if you can possibly manage that, so we have enough time for ample questions.

Could we start with Mr. Hart from MiningWatch Canada?

Go ahead, please, sir, for up to 10 minutes.

3:35 p.m.

Co-manager, Canada Program, MiningWatch Canada

Ramsey Hart

Thank you very much, Mr. Chair and other members of the committee. It's a pleasure to be with you today.

MiningWatch Canada is national non-profit organization. Our mandate is to improve mining practices and policies both here in Canada and where Canadian mining companies operate internationally, which I'm sure you know is pretty much around the world.

My own background is in ecology and environmental science. I've been with MiningWatch since 2008 as the Canada Program coordinator. In that capacity I am involved in environmental assessments, policy development, and support to communities that are trying to understand proposed mining projects. Occasionally we support communities that are trying to enforce their right to say no to projects, but we also support communities that are trying to grapple with the implications of projects that are advancing.

Some of our current work in the north includes very active participation around Ontario's Ring of Fire, looking at environmental assessment processes for that major new development. We're working on the Kiggavik uranium environmental assessment and facilitating a new network of academics and NGO folks who are looking at the impacts of mining on women in the far north. We do information sharing and exchanges across the country and work on broad policy initiatives, such as the Canadian environmental assessment review that is taking place shortly.

Mining is certainly having a profound impact in the north. While a large share of mineral investment is still going to southern Canada, the relative impact of mining in the north is much greater, given the overall smaller economies and smaller population in the north.

Most communities we work with, by and large, though not exclusively—we do recognize the importance of communities' right to say no—are looking at mining with optimism and welcoming arms for the economic opportunities it can advance. However, no one wants mining to be forced on them or, as Chief Gagnon said—who I was just speaking with—to be shoved down their throats. So it's important that we have processes in place to engage communities, to ensure adequate review of proposed projects, and to effectively have participation in the review of projects.

Mining in the north has a variety of unique social circumstances: a small population, and the fact that we're not talking about the development of new mining towns but more and more fly-in camps. The training deficit in the north is a major challenge to be overcome. There are a variety of social challenges, which although not unique to the north are perhaps more extreme in the north: housing crises, suicide, and substance abuse. Also we have indigenous cultures that are still strong. In some places they're being revived and adapted to the modern age, and this includes a strong reliance on wildlife resources for sustenance and maintenance of culture.

We have minimal infrastructure in many places, and we have unique and sensitive environments, especially with the changing climate. We already know that the north is suffering from climate change more than any other regions of Canada, and issues such as permafrost melting and disappearance of sea ice are major challenges to grapple with. We also have relatively new government institutions that are trying to find their way in this context.

One of our main messages to this committee in your study is the hope that we will pursue a strong and rigorous environmental and socio-economic review process for extractive projects. In our case, we're particularly interested in mining.

The basic structures are there: we have the Canadian Environmental Assessment Agency, the Nunavut Impact Review Board, the Mackenzie Valley Environmental Impact Review Board, and the Yukon Environmental and Socio-economic Assessment Board. None of these is perfect. They can all use some fine tuning, and they all need more resources to do their jobs effectively.

We would encourage the committee to consult the recent—from spring of this year—studies by the Mackenzie Valley Land and Water Board and the Government of the Northwest Territories on potential improvements. In those documents they clearly identify the gaps that need to be filled to complete those systems.

We're very concerned about the cuts to the Canadian Environmental Assessment Agency, given the increased workload that agency is experiencing.

I wonder about the addition of bureaucracies to the review process. I know an audit is being done of the major projects management office and I will be very curious to see what that audit tells us. For somebody from the outside, the addition of a layer of bureaucracy is a bit confusing to understand. How does that lead to greater efficiencies? It means I have to check two websites to find out where documents are posted. That's a relatively minor inconvenience, but certainly in terms of costs and efficiencies I wonder where that leads us.

The federal government has made important commitments to establishing regional monitoring networks that can contribute to understanding broad regional issues that can then facilitate individual project applications and environmental assessments. These commitments have not yet been fully met.

In the south we've had review panels, which have given opportunities for communities to have their voice heard in the development of projects. Unfortunately, we have seen a trend recently toward removal of those processes, or a reduction in the number of those processes.

I think there's a cautionary tale here regarding Ontario's Ring of Fire. This is a potential mineral development that is unprecedented in recent decades. People have likened it to the scale of Sudbury: massive mineral potential in an area that currently has very little infrastructure.

Many first nations would be affected by proposed developments in the region, part of the Matawa as well as the Mushkegowuk first nations. These nations are interested in development. They see opportunities here, but they want to proceed in a way that respects their culture and ensures the protection of their environment to the greatest degree possible. After consideration, they have developed positions that suggest a review panel would be the best way to move forward. They asked the government to engage with them to negotiate a process to review the projects and they were turned down flat. Instead the government suggested a comprehensive study would suit their needs, or the needs of the companies or the needs of government. I'm not sure whose needs they thought would best be suited to that process. Certainly it wasn't the first nations' perspective on what was needed.

So we've gone from having a climate of opportunity and potential development to one of conflict, potential legal suits, and something that will inevitably draw out the process in a very unproductive way.

There are a few lessons to be learned from operating mines. With respect to impact benefit agreements, there are a lot of differing experiences, some positive and some negative. We can look to the mines of northern Saskatchewan that have admirable levels of employment of indigenous people, but it's taken a lot of effort; it doesn't just happen.

Employment at the Meadowbank Mine in Nunavut has had a high turnover rate, which is of concern. And access to jobs is a real issue, as well as a ceiling for people because they don't necessarily have the training and background to obtain higher-level positions.

Another area we're quite concerned about is the closure of mines in the north in particular. Thinking about mine closure at the beginning of the process has become institutionalized from the industry perspective, but we still don't know who and how we're going to take care of many of these sites for the hundreds of years they will need to be looked after. The Raglan Mine in Nunavik was not predicted to be a major concern post-closure, but now that the mine is operating, we know it will likely require water treatment long into the future.

A number of research gaps need to be addressed in terms of technical issues like impacts of climate change on mine infrastructure, the social issues around community benefits and well-being related to mining, and ecological issues in terms of wildlife population baseline studies.

There are a tremendous number of challenges to face as mining moves forward in the north. There are opportunities here. We only have a chance to do it right once, and I hope the government pursues a path of rigorous review and engages the populations that will be most affected by these projects.

Thank you very much.

3:45 p.m.

Conservative

The Chair Conservative Leon Benoit

Thank you very much for your presentation, Mr. Hart.

We go now to the Mining Association of Canada, Pierre Gratton, president and chief executive officer.

You will be making the presentation, sir?

3:45 p.m.

Pierre Gratton President and Chief Executive Officer, Mining Association of Canada

Yes. I've handed out copies to everyone. I'm going to flip through it rather quickly, in light of the time constraints.

I did want to start by first off acknowledging a lot of Ramsey's comments. It may surprise some of you, but I'm going to support a lot of the comments he's made today. I think we're in agreement on a broad range of issues.

I'll set out a bit more context for you. First, we are the national organization representing the producing side of the mining business. Those who have mines in production or almost in production make up our membership. We currently have about 36 full members and a bunch of associate members that represent the supply side of the business.

The industry, as I'm sure all of you know, is a fairly large part of the Canadian economy, and it has been for quite some time. With the run-up in commodity prices that we've seen over the past five or six years, with a dip in 2008 that turned out to be quite short term for our sector, there is a large degree of optimism in our industry that we're in for a cycle of growth we haven't seen in generations. For example, we do an annual tax study, and we found that in 2010 there was a 65% increase in payments to governments that year. That doesn't happen every year, but what it does underscore is how quickly the mining industry turned around from the 2008 economic crisis.

If there is a key message for you, it's that ours is a very important engine of growth right now in a time of global economic uncertainty.

We are the largest private sector employer of aboriginal Canadians across the country. To Ramsey's point, there are certainly areas where there has been more success than others. I think every new project tends to bring with it strong commitments to aboriginal employment and business procurement, and we're seeing increasing trends in that area.

You'll find that our industry right across the country has a broad range of commodities. Most of what the world needs can be found in different parts of Canada.

There's a quick slide here where I report back what you have said about the industry in terms of our environmental performance. Ours is an industry that has a significant, albeit local, impact on the environment. We have made major strides in the last few decades in trying to better manage those impacts. The job is not done. There is ongoing work and improvements that can continue to be made with respect to environmental management.

In addition to the commitments we make with respect to meeting regulatory obligations, we have a program called Towards Sustainable Mining. This program is a condition of membership, which includes member companies reporting on site performance at the facility level, and that is subject to external verification of performance every three years. It's an initiative that has won MAC awards, and it has been recognized as best in class across the country. It is a demonstration of our industry's commitment to continuous improvement and to earning our social licence.

To put what's happening globally into context a little more, the China factor, which we are all aware of—it's primarily China at this point, but Brazil, India, Mexico, and other countries are having an impact on the global economy, particularly with the demand for commodities.... We've seen 30 consecutive years of 8% to 15% growth. While China's impact in the 1980s was minimal, today it is huge. They consume 30% of the world's commodities today.

We've seen major run-ups in commodity prices. This table shows results from June 2011. There has been a bit of a dip since then, but prices have remained pretty robust. Copper was most recently at $360 per pound. That would have been beyond our wildest dreams a decade ago.

In this context, there is a race around the world for developing and finding new projects, and Canada is well positioned to benefit from that. Obviously we want to do so responsibly, but at the moment, for example, we are attracting the largest share of global exploration spending. We've estimated some $137 billion in potential new investment in Canada over the next five to ten years in different projects or in project expansions across the country.

We expect that to continue. Why? Because in the U.S., 76 out of every 100 persons has a car or a computer; in China, it's 10 and 4, respectively. As their middle class grows and starts to want the things that we have, the demand for commodities will continue.

In terms of opportunities across the country, there are a lot in every region. We've highlighted for you those projects that are in advanced stages in the territories, with significant capital expenditures there. The impact we've had in the north over the last decade, particularly in the Northwest Territories around the diamond industry, has been significant. We represent 30% of GDP in the Northwest Territories. We are the largest employer of aboriginal people. There has been some $4 billion in business procurement with aboriginal businesses in the Northwest Territories. So we have had a significant and potentially transformative impact.

This is not how the industry used to do business in the north. The experiences with Giant are very different from the way they are today with the diamond mines and with the way I think we will see Meadowbank unfold.

To turn to some of the issues that Ramsey raised, and where I think there is also some broad agreement about the challenges facing the north, we too recognize that aboriginal training and employment are challenges. We are very committed to and have been very big supporters of the aboriginal skills and employment partnership program with the federal government. The mining sector has been the biggest user of this program, and it has helped to provide training and on-the-job work experience for aboriginal people in Canadian mines. The most successful of these has been based in Yellowknife, but there are other initiatives like that across the country.

We also agree that there is definitely a need for infrastructure going forward. Investments in roads and ports in order to facilitate the kinds of investments we are talking about will be important.

We too believe in a strong and robust environmental assessment process. We want it to be efficient, but we do not argue in any way for a lessening of the quality of environmental review. The amendments to the CEAA are a case in point, and we'll be presenting our views to the environment committee shortly, in the next couple of weeks. But in our view, what those amendments did was put the Canadian Environmental Assessment Agency in charge of environmental assessment. They have made harmonization with the provinces possible and they have shortened the front-end delay, which was really associated with just getting the federal government to agree to start the process. With those amendments, the feds now start immediately. It has not in any way, in our view, compromised the quality of environmental assessment, but it has made it more efficient and has allowed for a better use of resources devoted to environmental assessment.

We share the views that Ramsey expressed on the potential cuts to this program. There haven't actually been cuts yet. There have been rumours of potential cuts. We've been advocating that funding be renewed in the upcoming budget, not only because of the demand coming from our sector in particular but also in general to implement effective and efficient environmental assessment.

There are a number of issues unique to the north as well. We've been very involved with the various boards and agencies in the Northwest Territories and in Nunavut. We've been strong proponents of advancing Nunavut legislation and are very supportive of the progress made there.

We think there is tremendous opportunity in northern Canada. There is, at this point, just one operating mine in Nunavut. There is potential for more. I don't foresee a huge number coming in rapid succession, but I think Nunavut itself would welcome some additional mining projects to help support its economy. So we look forward to the years to come and the possibilities in northern Canada.

I'll stop there, because I'm sure there will be lots of opportunity to expand on these topics through questions.

3:55 p.m.

Conservative

The Chair Conservative Leon Benoit

Thank you very much for your presentation, Mr. Gratton.

We'll go directly now to questions.

We'll start with Mr. Lizon. You have up to seven minutes, please.

3:55 p.m.

Conservative

Wladyslaw Lizon Conservative Mississauga East—Cooksville, ON

Thank you, Mr. Chair.

3:55 p.m.

NDP

Claude Gravelle NDP Nickel Belt, ON

May I interject for a second?

In order for everyone to get some time in this hour, could we reduce our rounds to five minutes?

3:55 p.m.

Conservative

The Chair Conservative Leon Benoit

I requested that, and there isn't agreement.

Let's go ahead with the normal questioning procedure.

3:55 p.m.

Conservative

Wladyslaw Lizon Conservative Mississauga East—Cooksville, ON

Thank you very much, Mr. Chair.

Thank you, gentlemen, for coming to our committee this afternoon.

The first question I have is for Mr. Ramsey Hart. I listened to your presentation carefully. Can you tell us exactly what your position is and where your organization fits in the whole process of exploration, etc.? Who do you represent, who do you advocate for, and what powers does your organization have, if any, to enforce certain issues?

3:55 p.m.

Co-manager, Canada Program, MiningWatch Canada

Ramsey Hart

Thanks for the question.

MiningWatch formally is a coalition of 20 different organizations, including first nations, conservation groups, faith groups, human rights groups, and international development groups. We get our mandate partly from those groups, but also partly from communities that approach us, largely to help them explore mining issues. We engage when we are asked to engage on specific projects. That may be at the exploration phase. We may help, for example, the Barriere Lake Algonquins to say no to an exploration project on their traditional territory because the federal and Quebec governments have not respected an agreement that they've had going for 20 years now.

We respond to requests. That's how we become engaged. That may be anywhere in the cycle but more typically at the stages from exploration to new mines, not so much operating mines, though it could well be at that stage. Also, we get involved around mine closure. So it's right across the mining sequence.

As to whether we have any power or not, we have some. We gain most of our power through networks by taking principled positions and by using the media, approaching investors, and things such as that.

3:55 p.m.

Conservative

Wladyslaw Lizon Conservative Mississauga East—Cooksville, ON

If there is a proposed project, whether it's for exploration or building a mine, and you're against it, what exactly would you do? It would be up to the regulatory bodies to make the final decision.

3:55 p.m.

Co-manager, Canada Program, MiningWatch Canada

Ramsey Hart

Absolutely, it would be, and that's the way it should be.

First of all, we try to make sure the regulatory agencies are doing their job. They don't always do their job according to the law. Lawsuits against CF, for example, that MiningWatch has launched have been successful in pointing that out.

We may also participate actively in such regulatory processes as environmental assessments. I note that we don't take a position against a mine or an exploration project unless it's on the request of affected communities.

3:55 p.m.

Conservative

Wladyslaw Lizon Conservative Mississauga East—Cooksville, ON

Thank you very much.

The next question is to the Mining Association of Canada.

In your presentation you mentioned that you have 40 members, if I remember correctly.

3:55 p.m.

President and Chief Executive Officer, Mining Association of Canada

Pierre Gratton

We have 36 full members at the moment.

4 p.m.

Conservative

Wladyslaw Lizon Conservative Mississauga East—Cooksville, ON

Would that be across Canada?

4 p.m.

President and Chief Executive Officer, Mining Association of Canada

4 p.m.

Conservative

Wladyslaw Lizon Conservative Mississauga East—Cooksville, ON

Would they be operating mines or would they be both exploration and mining companies?

4 p.m.

President and Chief Executive Officer, Mining Association of Canada

Pierre Gratton

It is for the most part operating mines.

We have some members who are in very advanced stages of development. Take, for example, Newmont, which is a global international mining company but which has within Canada an advanced project in Nunavut, but not actually an operating mine.

Actually, I think they're still a full member, now that I think of it. But it would be that kind of example—a company that is not yet in production—that would be an associate member.

4 p.m.

Conservative

Wladyslaw Lizon Conservative Mississauga East—Cooksville, ON

How many non-members would be operating in Canada?

4 p.m.

President and Chief Executive Officer, Mining Association of Canada

Pierre Gratton

It depends on how you define a Canadian company. There are estimates of some 1,400 companies listed on the Toronto Stock Exchange. They don't all operate in Canada, and a lot of them are junior exploration companies. There is an organization called the Prospectors and Developers Association of Canada, which represents the junior exploration business, the front end, the ones who go out and find these projects. We're the ones who, once they're found, develop them and mine.

4 p.m.

Conservative

Wladyslaw Lizon Conservative Mississauga East—Cooksville, ON

We've been doing this study for some time now. We've heard from different witnesses, and we have heard about the challenges that both exploration and mining face, especially in the north. We heard from people who do geomapping.

As you know, the federal government finances some geomapping. Could you elaborate on the challenges of geomapping and how your members would benefit from these programs?