Thank you, Mr. Chairman.
Avalon Rare Metals Inc. is one of the few mineral developers in the north with an advanced development project. It's called Nechalacho. It's a unique deposit. It's one of the highest-quality mineral deposits of its kind in the world, enriched in the rare earth elements. It's an emerging commodity group that is proving vital to new technology, especially clean technology. This particular mineral deposit represents an opportunity for Canada and the Northwest Territories to lead the world in a new supply source of these key raw materials.
Today I'd like to share with you some of the challenges we have been facing in moving this project through the regulatory process. Generally, the Northwest Territories is seeing some of the lowest levels of investment anywhere in the world, even though we are experiencing a global boom in investment in the mining sector as the whole world searches for new sources of commodities.
Why is that? Speaking as a geologist, I can assure you it's not to do with a lack of endowment in mineral resources in the Northwest Territories. This is arguably one of the most mineral-rich terrains in the world. It's certainly no less endowed than its neighbouring jurisdictions in Nunavut and the Yukon, which are seeing strong growth in investment in mineral development. Clearly, the finger has to be pointed at the regulatory process, which we would characterize as very inefficient. Also, some of the complications are related to unresolved land claims and a complicated consultation process that offers developers no clear rules of engagement with first nations.
In our case, the community consultation process has actually gone quite well. We recognized this as a challenge when we first started working up there in 2005. By being diligent in our consultation, we've managed to reach good working relationships with all of the community leaders of the aboriginal groups we are working with. We've had 165 consultation meetings since we started up there in 2007. It has generally been appreciated. In fact, the chief of the Yellowknives Dene First Nation, Ted Tsetta, said publicly on several occasions that when it comes to consultation, Avalon does it right.
That's not the problem we're facing. Our problem is an inefficient permitting process related to the environmental assessment process. I'll give you some specifics. This is an advanced project. We filed for our initial permit applications with the Mackenzie Valley Land and Water Board in April 2010. It was immediately referred for environmental assessment. There was no surprise there. That's fairly routine for a project of this scope. However, it took eight months just to complete the initial community scoping sessions to establish the terms of reference for the environmental assessment process.
After that, we produced our developers assessment report, which was some 1,000 pages long, and filed it within three months of receiving the terms of reference. It then took five and half months for the review board to determine that our report was in conformity with the terms of reference. This wasn't to review the technical details. This was just to make sure it was in conformity with the terms of reference. It was five and half months. This should take only a month to 45 days to complete.
What's happening to us is that each one of these slow response times is accumulating into setting the whole process behind the schedule we need to work to. It's very important with this project, because, basically, we're in a race against other producers of these commodities around the world to get to market with our product. These are non-traditional mineral commodities. You have to develop your markets for them and find customers, and we're competing with other potential producers around the world to serve that need outside China. If we fall behind in that race, it may not just delay development—it may ultimately frustrate it from ever being developed. It's important to keep to these timelines.
We're having a lot of difficulty getting that message across to the regulators with the review board in Yellowknife. Some of the specific concerns that we can pass on are that we find the staff generally unresponsive. They're unwilling to work in a collaborative way. All communications have to be in writing; we can't simply sit down and talk things through and find a solution to moving the thing forward. We're not allowed to do that. They do not seem to have the manpower they need to do the job and get things done quickly. There's no accountability on decisions and timelines. There are no specific timelines laid out and there are no consequences to not moving these files forward at a reasonable pace.
Lastly, what we are particularly frustrated with is that there's a clear lack of impartiality in public meetings. The officers with the review board clearly have an anti-development bias, and it's just not appropriate when these projects are being presented in public meetings for consideration by the public as an opportunity.
As I said, we're in a race now, but there are a number of ironies associated with this too. While the regulatory process is frustrating us, it's not because there is a lot of organized public opposition. There is no organized public opposition to this project in the Northwest Territories. The aboriginal groups support it. The municipal government supports it. The GNWT supports it. The only people who don't support it are individuals within the review board apparently.
Furthermore, we have a pretty good track record in working with the aboriginal groups, who have complimented us on our consultation. We have a land use permit. We are inspected on a regular basis for compliance with the terms of that land use permit—which are fairly rigid. We've been inspected 25 times since we initiated drilling operations on the site, and we've been consistently found to be in compliance with those regulations. So we're not a bad actor in terms of demonstrating our willingness to comply with the rules as they exist right now.
No substantial environmental concerns have been identified with this project, and it will actually have a relatively small development footprint compared to many such opportunities, mining operations, being considered for development around the world.
I just wanted to share with you our frustrations with this inefficient process. It really needs to be looked at carefully for how it can be improved to better serve developers and the public generally. We've invested some $45 million to date in this project; we're committed to seeing this through to the finish line. But I'm often asked, “So you're a pretty big stakeholder in the Northwest Territories now that you've invested a lot in this project. I'm sure you're looking for other opportunities to develop projects in the north.” Frankly, I have to say no, we're not. We're going to look elsewhere for the next opportunities if we have to continue to endure as inefficient a regulatory process as we are now experiencing in the Northwest Territories.
Thank you very much.