Thanks very much.
I'm Lisa McDonald, and I'm the interim executive director with the Prospectors and Developers Association of Canada. I'm joined here today by my colleague, Lesley Williams, who's our director of policy and programs.
I'd like to thank you for the opportunity to be here today to provide input on behalf of the mineral industry on Bill C-69. Our comments will focus mainly on the aspects related to impact assessments.
PDAC is the national voice of Canada's mineral exploration and development industry. We represent over 7,500 members from Canada and around the world. As the trusted representative of the sector, PDAC encourages leading practices in technical, operational, environmental, safety, and social performance.
Just briefly about the mineral exploration industry, it is a staged process of information-gathering with the hopes of discovering an economically viable mineral deposit, which is a little bit like looking for a needle in a haystack, quite frankly. Junior exploration companies do the bulk of this work in Canada. These companies are small. They have limited budgets and timelines. Most do not generate revenue and fund their activities by issuing shares. While some exploration companies may sell promising projects to mid-tier or major mining companies in order to take them through the assessment process and to be mined, a number of junior companies initiate the assessment process themselves.
Our remarks today will cover a brief overview of the mineral industry, two proposed amendments to Bill C-69, and comments on some of the key provisions in the act.
The value of Canada's mineral industry cannot be overstated. The mineral exploration and mining industry makes vast contributions to Canada. From remote and indigenous communities, rural areas, to large cities across Canada, it generates significant economic and social benefits for Canadians.
Our industry contributes more than 3% to the GDP. Valued at $89 billion in 2016, mineral exports accounted for 19% of Canada's total domestic exports. The industry employs nearly 600,000 workers across Canada, and it is also the largest private sector employer of indigenous people in Canada, and is a key partner of indigenous businesses.
That being said, the Canadian mineral industry faces fierce global competition for investment. In fact, Canada is starting to fall behind its competitors in a number of areas, indicating its decline in attractiveness as a destination for mineral investment. From 2012 to 2016, there was a prolonged downturn where investment in the sector severely declined around the world. Investment has started to return and has strengthened globally, however, in Canada mineral investment has stagnated and it is not recovering as substantially as in other jurisdictions.
A number of factors affect the decisions made by investors about where to invest, and by companies about where to explore and mine. Investment, both foreign and domestic, is particularly sensitive to legislative and policy changes. These generate uncertainty and unpredictability. An unpredictable, complex, and inefficient regulatory regime that is not well implemented will increase risk and deter investment and, consequently, exacerbate the waning of the Canadian mineral industry's competitiveness.
In order for the Canadian mineral sector to regain strength, we are proposing two amendments to the legislation that are critical to our industry.
We are proposing that the committee consider amendments regarding transition. Bill C-69 proposes that when the impact assessment act comes into force, projects that are being assessed under CEAA 2012 would have their assessment continued under the new act, unless they are in the final phase of the process. Industry recommends that the transition provisions be amended so that projects being assessed under CEAA 2012, or those that will enter the process before the coming into force of the new act, must be allowed to continue under CEAA 2012 unless the proponents specifically request the transition. This amendment to transition is critical. Otherwise, it would be extremely disruptive and cause uncertainty for industry, which will ultimately have a negative impact on investment.
Our second proposed amendment relates to the assessment of uranium mines and mills under the new act. We recommend that, similar to any other designated mining project, designated projects that are uranium mines and mills should undergo agency assessments with full access to provisions for co-operation with provinces and indigenous groups.
In its current form, Bill C-69 would preclude co-operation and agency assessment for all designated projects that are regulated by the CNSC.
With respect to the provisions, we understand that critical regulatory policy decisions remain to be developed with regard to the implementation of the new act, and these could materially influence the assessment process for project proponents.
We would like to briefly offer comments on some of the other key aspects proposed in Bill C-69. In general, we support Bill C-69 expanding the scope of factors and effects to be assessed, but there are potential implications to be considered. This expansion of scope will result in significant increases in the amount and type of information required and studied in project assessments. This could exacerbate the time and cost burden. Of particular concern are the ways that this will impact the ability for exploration companies to advance good projects.
Further, the collection, analysis, and weighting of impacts related to these diverse areas can also pose challenges. Views on whether an economic or social impact is positive or negative can be subjective and difficult to quantify. The weighting of various impacts is also not straightforward, particularly in the absence of any plan or guidance on how the various factors should be considered. The new process will require very clear, transparent guidance outlining the impacts that will be considered, the methodologies for the way these elements will be studied, and the weighting of impacts against each other.
With respect to cost recovery, PDAC urges careful consideration in terms of its implementation. Fees required should be transparent and predictable, and proponents should not bear undue burden of the costs for the assessment process. Some jurisdictions already have cost-recovery mechanisms for permitting and assessments. Imposing additional fees for the federal process would mean a duplicate cost for what is ideally intended to be one process, one assessment. This is particularly critical for junior exploration and development companies because, as mentioned before, they have very limited funds and generate no revenues.
Cost recovery, at a minimum, should have a clear, predictable, reasonable set fee per assessment; be linked to various guarantees, including timelines of process; and exclude out-of-scope costs such as policy development or regional assessments.
With respect to timelines, Bill C-69 proposes legislated timelines for project assessments, a provision that PDAC strongly supports. Clearly defined timelines are essential for the certainty that proponents and investors require, leading to a predictable, timely process. PDAC recommends that timelines should allow for alignment with the assessment process of other jurisdictions and enable co-operation, with the objective of one project, one assessment. We also recommend that the factors for suspension of timelines be clearly defined, and limited to specific circumstances to avoid endless delays and undermining predictability.
The mandatory early planning and engagement phase, if designed and implemented well, could provide more clarity for proponents and predictability for the process. That said, some important elements to consider are that officials must have the resources, both human and financial, to provide a proponent with a forward-looking permitting plan. Early planning could adversely impact proponents, particularly mineral exploration companies, as it could require various studies earlier on in the process than previously through CEAA 2012.
Proponents must have the ability to amend the project during the planning phase in response to indigenous and community feedback without having to restart the process from the beginning.
Bill C-69 outlines a more prominent, formalized role for indigenous peoples and traditional knowledge in the assessment process. PDAC supports meaningful participation by indigenous communities in project development and throughout the life cycle of a project. The mineral industry, as a leading practice, builds strong partnerships and seeks input on aspects related to their projects, and also guarantees economic opportunities for indigenous communities. As such, much of what is in Bill C-69 reflects the reality of current practice in the mineral exploration industry.
Furthermore, Bill C-69 proposes that the new agency would coordinate crown consultations and require, by statute, the consideration of potential impacts on indigenous rights. PDAC supports the crown or its delegated authority taking responsibility for fulfilling its duty.
We urge government to assess and outline its requirements for consultation and accommodation with indigenous peoples, to develop a transparent consultation plan that conforms to the tenets of consultation as articulated by the courts, and to assume its responsibility in the process, including for related costs.