Natural Resources Committee on June 21st, 2012

[The Chair, Conservative, Leon Benoit]

Good morning, everyone. Welcome to the continuation of our study on resource development in northern Canada.

We have with us today four groups of witnesses. From the Mining Association of British Columbia, we have Karina Briño, president and chief executive officer. Welcome.

From Vale, we have Jody Kuzenko, general manager of sustainability, base metals, North Atlantic region. Welcome.

From Ecojustice Canada, we have William Amos, director, from the University of Ottawa Ecojustice environmental law clinic. Welcome.

And from Diavik Diamond Mines Inc., we have Gordon Macdonald, principal advisor, sustainable development. Welcome to you, sir.

We will start with the presentations in the order listed on the agenda. First, from the Mining Association of British Columbia, is Karina Briño.

Go ahead with your presentation, for up to seven minutes, please.

[Karina Briño, President and Chief Executive Officer, Mining Association of British Columbia]

Thank you very much. Good morning.

It is an important opportunity for us to speak with you this morning. What I would like to do in my seven minutes is to provide you with an overview of who we are, as far as the association is concerned, and with an overview of what the mining industry is doing in British Columbia today. I'll talk to you as well about some of the challenges and opportunities we see going forward.

In terms of what the mining association is, we are the representative of all the operators in British Columbia. This does not include the junior exploration group. It's primarily the operations. That includes coal, metal, industrial minerals, and some of the aggregate producers.

We have been around since 1901. Our primary priority, our primary objective, is to not only raise awareness about mining in the province but to share information and educate the public. We also educate ourselves about what some of the concerns about mining are among the general public. So it's really about dialogue.

You have a list of our members. Again, that includes all the operators as well as companies that have advanced projects in the province.

In approximately the middle of May this year, we released our latest statistics on what the industry is doing. This information is based on 2011 data gathered by some of our members. It does not include all the companies, so it's not a full picture of what the industry is doing.

In B.C., from the 19 major operations we have in some of the advanced projects, the mining industry contributed about $10 billion to the B.C. economy. That is a 25% increase from 2010.

When we look at the numbers in more detail, a good 80% of that 25% increase came from coal in the southeast and in the northeast of the province. That increase in mining revenues also translated into an increase in capital expenditures, an increase in mineral exploration, and an increase in payments to governments. But the real story for us is the increase in job creation and average salary. In B.C. right now, the average salary for someone working in the mining sector is about $115,000, which is a significant number in comparison to the $65,000 or $67,000 for the rest of the population.

That's really where our focus is right now. It is about how we find opportunities to create some common ground that will continue to allow benefit creation in the province for British Columbians. We are also interested in knowing how we increase public participation in the process.

Focusing strictly on northern British Columbia, which I believe is the focus of your exercise this morning, if we look at the whole province, there are about 30 projects in process, at one stage or another, right now. Over the next 10 years, if all of those projects go through, we're looking at about $30 billion in investment in the north alone. I'm talking about north of Smithers. In the northwest, it's about $20 billion and 6,300 jobs. In the northeast, because there is still a lot of development going on and not as many operating mines, it's about $2 billion in investment and about 2,000 jobs. Again, that's where the focus is for us, and it will continue to be over the next little while.

The northwest transmission line obviously is going to be a key player in the ability of some of these projects in the northwest to go through. We're looking forward to that being on target, as well, for 2014. The next new mine that is going to open, the Red Chris project in northwest British Columbia, will be the first industrial customer of the northwest transmission line.

Those opportunities come with challenges. The challenges can also be seen as an opportunity for the industry to engage in a different kind of dialogue, as I said, with stakeholders and primarily with aboriginal communities.

In terms of federal-provincial relationships, the duplication and overlap in project approvals and environmental assessments have been of concern to the province of B.C. for a number of years now. We are encouraged to see there is a move in the right direction when it comes to the elimination of duplication, and actually more consistency in timelines associated with that process.

We need to be clear so that it is known in the public that what we're looking for is predictability in the process. We're looking for clarity in terms of how decisions are made, who makes them, and how long they're going to take. Once I enter the process, I need to know when I'm going to get out of it. Whether it's a yes or a no, the point is to have clarity and transparency in that process. Timelines and clarity in the scope are our primary interests.

There are all sorts of opportunities to talk about what that would look like on the ground, but the general intent of the changes to the environmental assessment process is something we're very supportive of. With that, there are other legislative and policy changes that we also think are an important opportunity for the industry to engage in dialogue with government. In terms of the Fisheries Act, they would include effluent regulations, etc. I don't think these are simple solutions. It does create an opportunity to talk more about what this would actually look like on the ground. Some of those changes are not necessarily things the industry would be pushing for, but certainly the opportunity to talk about them is what we're interested in.

I don't think we can talk about improvements in regulation and improvements in process without talking about aboriginal relations. This is something we're very interested in from the perspective of how we can engage meaningfully and what that means. What is the role of the industry versus the role of the crown in terms of meeting its duty to consult? What is the role of industry in terms of benefits going towards aboriginal communities? We do have a social responsibility towards that. There needs to be clarity around that, in terms of when my responsibility stops versus the government's. That's also an opportunity we haven't explored to the fullest yet.

I'm conscious of the time, so I'm going to leave you with the thought that the industry is very interested in a different kind of conversation. We are interested in finding common ground. The association has been reaching out to those groups that are expressing tremendous concern about some of the changes. We want to make sure they understand, as well, where we're coming from when it comes to finding efficiencies and transparency.

We're here hopefully to address some of your concerns, as well as some of your questions about what that means for us. The industry is committed to social responsibility and our own social licence. I think we've demonstrated that by some of the measures in the reporting commitments we've made with the Mining Association of Canada towards sustainable mining initiatives.

I look forward to your comments and questions. I hope the information I've provided has been of some assistance to you.

[The Chair, Conservative, Leon Benoit]

Thank you very much for your presentation, Ms. Briño.

We will go now to Vale and Jody Kuzenko. Go ahead with your presentation, up to seven minutes.

[Jody Kuzenko, General Manager, Sustainability, Base Metals, North Atlantic Region, Vale]

Thank you.

I think you're going to hear some common themes this morning.

I want to start by thanking you on behalf of Vale for this opportunity to speak to you this morning on natural resource development in the north. It's a topic that's important to us as an organization, to mining as an industry, and I think to Canadians more broadly.

I'll start by telling you a little something about our company. Vale is the world's second-largest mining company by market capitalization, second only to BHP. We're present in 38 countries around the world and employ some 134,000 people.

In our Canadian operations, our employee base is 6,500 people strong. We're in four provinces with our operations and have exploration activities in many more areas. Apart from the 6,500 direct employees, we employ approximately 10,000 contractors, suppliers, and service representatives.

Our primary product is nickel, of course. We're the second-largest producer in the world after Norilsk.

As a primary producer we don't often talk a lot about end uses of the product, but I always try to bring that into conversations. Nickel is used to produce stainless steel and metal alloys, which are then used in the production of airplanes, automobile engines, surgical instruments, and batteries, as well as new batteries for hybrid cars. There's so much impetus to be green these days and so much discussion around that, and mining is often viewed as antithetical to that, but I often say that none of us wants to fly home in a biodegradable plane.

We also produce copper, cobalt, and platinum group metals. With our potash project in Saskatchewan, we'll soon be in the fertilizer business and adding an important contribution to the world's global food chain.

Outside of Brazil I would say that no single country is more important to Vale's fortunes than Canada. Our base metals business, as it's called, is headquartered in Toronto. It's divided into three geographic regions: North Atlantic, South Atlantic, and Asia Pacific. The North Atlantic, of course, is focused on Canada.

An important point is that the North Atlantic team is headquartered at our operations in Sudbury, Ontario, in the north. This means that the team of people who lead the mining operations in Canada live in the north. We raise our families in the north, and most of us are from the north. The point there is that we care about the north.

The entirety of our base metals business in Canada is in the north: northern Labrador, northern Manitoba, and northern Ontario. Our exploration activity takes us even farther north to Nunavut in search of the next metal discovery to sustain our business.

At Vale, our vision is to be the world's best mining company. It's a pretty lofty ambition, as it should be, and it's important to articulate what the best means to us. It doesn't mean being the biggest. It means aspiring to be the best. It means aspiring to be the best on values that are fundamental to us, such as: life matters most; health and safety; a respect for the natural environment; responsibility to communities in which we operate; and generating sustainable benefits for this generation of Canadians and the next. Put simply, to me it means that we need to take responsibility and act responsibly.

How will we achieve our vision? It's difficult to reconcile a sustainable platform with a mining company. After all, as a non-renewable resource, it doesn't grow back once we take it out of the ground. But I would say that an industry that has survived and prospered over the better part of a hundred years is the very essence of sustainability, and that's how far back our roots in northern Canada extend.

In Canada, we've embarked on an aggressive strategy to see the next generation of miners. In November of 2010, we announced a $10 billion investment in Canada. It's one of the boldest and most aggressive investment packages in the country and certainly, without question, in our company's history.

The program includes: a $3.6 billion investment in a hydrometallurgical processing plant at our operations in Long Harbour, Newfoundland; a $2 billion investment to retrofit our smelter in our Sudbury operations, called the Clean AER project, with AER standing for atmospheric emissions reduction; a potential new mine development in Thompson, where we're closing down our smelter and nickel refinery and transitioning to a mining-milling operation, so we're investing money in mine development there; and a potash development in Saskatchewan, at a spend of between $2.5 billion and $3 billion.

We're investing in Canada because we believe in Canada. The country is, as we all know, blessed with an abundance of natural resources, with, importantly, a stable political environment, and with some of the most highly skilled miners on the planet.

But we do have our challenges. Vale's future and the future of mining in Canada depend on finding and developing viable mineral deposits that will lead to the next mines. I echo the concerns of Karina that exploring in the north is fraught with risk and instability. It's costly, given the lack of infrastructure, vast distances, remote locations, harsh climates, and decentralized regulatory environment.

I have a number of examples of the complexity of permitting and regulations in the north, largely recent examples from our exploration in Nunavut. There, setting up a small tent for exploration work requires three permits from three different entities.

Permitting for early exploration can take anywhere from three months up to a year. Bear in mind that early exploration work is light, low-impact work that is the least intrusive part of the mining cycle. We're just looking to see if there are mineral deposits there worth exploiting, yet the system seems to mitigate against that with a three-month to one-year delay.

In another instance, it took the better part of three months to get a permit to land a helicopter in the north. So, it takes three permitting entities to peg a tent, three months to land a helicopter, and we're just checking to see whether there are minerals there.

These are but a few examples. When tallied today, the amount of Vale's investment program exceeds the $10 billion announced in 2010, and therein lies the problem. Permitting delays, project interruptions, and rising costs result in projects being over-budgeted, over-scheduled, downsized, or worse, shelved entirely. We call it capital paralysis.

The permitting and regulatory environment is an important part of that equation. What we want from government is a regulatory environment that promotes, rather than hinders, responsible and sustainable development. We support your efforts to streamline the regulatory review process and adopt a one-window approach.

Critics of that approach would suggest that it's a shortcut. I disagree. I think some people may not appreciate that complexity and volume do not necessarily impact quality or precision on topics like environmental assessment. You can have one without the other. A strong regulatory environment should maximize both effectiveness and efficiency to drive responsible benefits.

I was fortunate enough to hear a talk by an individual from the Treasury Board of the federal government. He introduced this concept of a world-class regulator. When I asked him what that meant to him, he had a very succinct answer. He said there were five things. A world-class regulator is one that acts on facts and scientific evidence, not the politics of the day, and takes a risk-based approach to regulation. Second, it is aligned with systems in other jurisdictions—internationally and provincially. Third, it allows for periodic reviews of its regulations to ensure that the regulations on the books are relevant. Fourth, it's one that views regulatory instruments as instruments of last resort, only for when education, awareness, and other efforts don't work. Last, it's a regulator that seeks to minimize administrative burden and is mindful of that as they are introducing new regulations.

I happen to agree with all of those points. The benefits are obvious—jobs, investment, and an enhancement of Canada's image as a centre of mining expertise and excellence.

I'll wrap up by saying two specific things. Tomorrow is a big day for us at Vale. We're launching our $2 billion Clean AER project, demonstrating our commitment to the environment. That's $2 billion on an environmental project designed squarely to reduce air emissions by some 95% over 1970 levels. That's not another ounce of nickel or copper out the door but purely an environmental investment.

We're also signing our first Ontario impact and benefit agreement tomorrow, with the Sagamok First Nation group with respect to our new Totten mine development.

In my view, these things demonstrate that mining, environment, and community can coexist, and we look to the government for support on these things.

Thank you for the opportunity for input.

[The Chair, Conservative, Leon Benoit]

Thank you, Ms. Kuzenko from Vale.

The next presenter is from Ecojustice Canada. William Amos is the director.

Go ahead, please, Mr. Amos.

[Professor William Amos, Director, University of Ottawa - Ecojustice Environmental Law Clinic, Ecojustice Canada]

Thank you for the opportunity, Chair and members. It's a pleasure to be here.

The issue of northern development is one that is a massive challenge to civil society because not only are many “southern” environmental groups not really present in the north—there are some who are—but there are also suspicions not just from the perspective of their interests in northern development or their disinterest as the perception may be, and not just vis-à-vis industry but also from with communities who live in the north. There is a lot of work that organizations like Ecojustice have to do in order to build trust with communities up north so that there is an understanding that in engaging in discussions around northern development the perspective of the vast majority of non-profit environmental groups is not one of “No, no, no” and not one of “Let's add process. Let's put sticks in the spokes”. It's actually a much more responsible one and requires dialogue.

I'd like to give you a perspective on where Ecojustice sits in the spectrum of this dialogue and then articulate a bit more clearly where our particular interests in northern development have been most expressed.

Ecojustice is Canada's leading public interest environmental organization. We have offices in Vancouver, Calgary, Toronto, and Ottawa. We have 17 lawyers. Our operating revenues annually are roughly $5 million. So one can tell that, while we're a substantial organization in the grand scheme of things, if Canada's largest public interest environmental law organization has a $5 million budget and we're dealing with projects that are upwards of $1 billion, we're small players in a giant pool. We understand that we have lots of work to do. We have to choose very carefully which projects we engage in and which issues we engage in, particularly in the north, where there are so many projects that are coming online in the very near future.

Ecojustice does two-thirds of its work litigating, taking on precedent-setting cases. We're before the Supreme Court regularly, but we don't only work in the area of litigation. We also do a significant amount of law reform work, so we were key players in the environmental movement's analysis of Bill C-38. It's our role to communicate the environmental community's perspectives on legal developments when the federal government engages in important transformations of the federal environmental governance regime. I'll actually keep my comments around Bill C-38 to a minimum. They do have impacts in the north.

[An hon. member]

It passed.

[Prof. William Amos]

It did, however, there is a Senate. You are correct, and we're not going down that road today.

[Professor William Amos, Director, University of Ottawa - Ecojustice Environmental Law Clinic, Ecojustice Canada]

Ecojustice most recently represented World Wildlife Fund Canada in the National Energy Board's Arctic offshore review, which took place in the shadow of the BP spill in the Gulf of Mexico. Our primary engagement at this point in the north at Ecojustice is on the issue of offshore drilling, and our position and WWF's position in this issue was not one of “No to drilling; it never can be done”, anti-offshore. It wasn't that at all, and it is worth clarifying that because, as I said, all too often the perspective is that environmental groups are opposed and they must be crushed.

It's our opinion that there can be responsible development in the north, and that there can be sustainable development in the north. Of course, those two words remain to be defined and they are politically charged. But when it comes to offshore development in the north, particularly in the Beaufort but also as we're now seeing proposals for seismic testing in the Davis Strait, we're anticipating significant activity there over the next five or ten years. There are some significant regulatory issues that must be addressed at a federal level before any kind of responsible or sustainable development can move forward.

Again, this is not an anti-offshore perspective. This is one that is focused on the social licence to operate. It's focused on ensuring that northern communities that rely on the environment to feed themselves and maintain their cultures can be sustainable as well.

I want to pick up on Ms. Kuzenko's theme of the timeliness of the length and complexity of the regulatory process. I have one very simple suggestion today, which would make a big difference with regard to the quality of the regulatory regime and of the certainty that industry would have going forward as well as the timeliness of their and government decisions. Right now, when the Ministry of Aboriginal Affairs and Northern Development makes a decision to issue a licence for offshore exploration in the Arctic, there is no environmental assessment process.

In the U.S. there is, and in Norway there is. There's a legal requirement for environmental assessment in those countries. In Canada the environmental assessment process has kicked in once the actual exploration activities are beginning. I would suggest that the uncertainty that this generates for industry and particularly for communities is significant.

At the stage of the issuance of licences there needs to be a full strategic environmental assessment of whether offshore drilling should go ahead in a particular area, well before significant investments are made to prepare for exploration activities. This way capital wouldn't be paralyzed and decisions by those communities up north could be made at a much earlier phase ,so that they could determine that over here is not an area where they want to be drilling, and over there, potentially, yes.

It's that one crucial question of when you are going to do an environmental assessment. Right now, they don't do it up front; they do it well down the line. The ultimate result is going to be that poor decisions are going to be made because they will already have determined that in areas X, Y, and Z they can drill. I would simply suggest that's a massive issue, particularly in the context of devolution. I'd be happy to talk to the theme of devolution between the Government of the Northwest Territories and the federal government with regard to offshore governance. That's another big issue. The environmental assessment feeds into that as well.

I'll conclude by saying that if there are any issues that interest people with regard to offshore liability and the reform of that regime in the post-BP spill world, we'd be quite happy to speak to that issue as well.

Thank you very much for your time. I very much appreciate the opportunity.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. Amos, for your presentation from Ecojustice Canada.

Our final presenter today is from Diavik Diamond Mines, Mr. Gordon Macdonald. Go ahead with your presentation, please, sir. You have up to seven minutes.

[Gordon Macdonald, Principal Advisor, Sustainable Development, Diavik Diamond Mines Inc.]

Mr. Chairman and members of the committee, thank you for the opportunity to speak to you today about the northern regulatory environment.

Diavik is a diamond mine that produces six to eight million carats of gem quality diamonds per year. Diavik is owned 60% by Rio Tinto, a diversified multinational mining company, and 40% by Harry Winston, a Canadian miner and jewellery retailer.

Diavik is remotely located 300 kilometres northeast of Yellowknife at Lac de Gras, which has only air and seasonal ice road access. Mine construction commenced in 2000 and production started in 2003. There is an expected mine life of another 10 years, to 2023. Since 2000 we've spent $5.2 billion, of which $2 billion was with aboriginal businesses, and $3 billion was with northern businesses. We currently average 642 northern employees and 313 aboriginal employees.

I've been with Diavik since the exploration phase in the mid-1990s. I assisted the project through baseline studies, environmental assessment, permitting, permit renewals, and am now focused on closure and reclamation planning. Along this regulatory journey we have faced many challenges. The ones I'd like to focus on today are the current operational regulatory challenges as compared with pre-development or environmental assessment challenges. I'd like to provide three specific examples which I think illustrate the type of issues we face in the northern regulatory environment.

First is fish habitat compensation. The Diavik mine site is on an island surrounded by a lake 60 kilometres long. The mine footprint covered four very small lakes on the island. The Department of Fisheries and Oceans issued a subsection 35(2) authorization under the Fisheries Act for the loss of fish habitat in these lakes and connecting streams. As a condition of the authorization, we were required to provide compensation for the lost fish habitat following the DFO policy of like-for-like replacement of habitat near where it was lost.

For Diavik, given its remote location, the only compensation options near the mine site were in pristine natural areas. Aboriginal communities in particular did not see the merits of fish habitat enhancements to a pristine environment hundreds of kilometres away from where people might use those fisheries resources. Diavik worked with communities to try to change the DFO habitat compensation work so that it could be done near communities instead. DFO remained firm that its policies did not allow for this.

We're now in our second year of a $4 million fish habitat construction project that doesn't appear to be valued by anyone other than DFO and fisheries researchers.

Second is effluent standards. The primary regulatory controls in a water licence are the limits for mine effluent discharges. Mine water management is one of the most important aspects of mine environmental design and management. Effluent limits should be predictable. They should be based on science and engineering with established and documented development procedures. Prior to development, mine operators must know the effluent standards they will be required to meet.

The Northwest Territories Water Act provides for the Minister of Aboriginal Affairs and Northern Development to make regulations prescribing effluent and water quality standards. This would provide the kind of certainty developers are seeking. Unfortunately, Aboriginal Affairs and Northern Development Canada has not done this and it has been left to the land and water boards to determine effluent limits on a case-by-case and sometimes ad hoc basis. While the land and water boards are attempting to standardize methods for setting limits, these methods are unlikely to be implemented successfully without supporting regulations from Aboriginal Affairs and Northern Development Canada.

Third is closure financial security. In 2000, Diavik accepted financial security requirements against closure and reclamation obligations, which increased over time to a maximum of $212 million. The crown currently holds $201 million. The amount is significant and was influenced by historic and ongoing local mine closure concerns, coupled with the location of Diavik on an island in a valued lake. As a condition of acceptance, provisions were included to allow the amount of security to be revised over time based on actual mine performance and practices.

The Wek'eezhii Land and Water Board has the jurisdiction to determine the amount of security for Diavik.

The Wek'eezhii Land and Water Board undertook an open and transparent three-year process to review and require revisions to our closure and reclamation plan, and to re-estimate the required financial security based on expert submissions by both Aboriginal Affairs and Northern Development Canada and Diavik.

The Wek’eezhii Land and Water Board determined that the financial security was to be reduced $131 million due to Diavik's significant investment into managing our closure and reclamation liability. Despite the Wek'eezhii Land and Water Board decision, the amount of security held by the crown has not yet been reduced, and Aboriginal Affairs and Northern Development Canada officials in Yellowknife are recommending adding an additional $30 million of security. The actions of the Aboriginal Affairs and Northern Development Canada officials in this case do not support the Government of Canada's agenda to reduce regulatory duplication and increase certainty for developers.

The examples that I've provided are intended to illustrate some of the regulatory challenges facing a mining operation that has demonstrated achievements in environmental and socio-economic performance in the Northwest Territories.

In the three examples above, the federal government are both the cause and the solution for the regulatory challenges. There exists a tremendous and ready opportunity for regulatory improvement in the Northwest Territories.

Thank you.

[The Chair, Conservative, Leon Benoit]

Thank you very much, Mr. Macdonald from Diavik Diamond Mines.

We go now to questions and comments, starting with Mr. Anderson, for up to seven minutes.

Before we start though, Mr. Anderson, I do want to say that we're leaving about 15 minutes at the end of the meeting to discuss future business, so we have a limited amount of time here.

I want to sincerely thank all of the witnesses for their information, and I'm looking forward to your answers to questions.

Mr. Anderson, go ahead, please.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Thank you, Mr. Chair.

Mr. Macdonald, we're interested, again, to hear of some of the DFO excesses that have been caused by that previous legislation. It confirms the wisdom of what we've done in passing our economic action plan this spring, I think.

Some of my other colleagues may talk about that, but I'd like to talk to you about something that's consistently come up through our study over the last year—as you're coming from three different geographic areas—and that is the issue of human resources. I assume, as many other witnesses have told us, that is an issue for you. I'm just wondering what you're doing in your part of Canada in order to deal with that issue. You're in northern B.C., you're spread out across some of the provinces, and you're in the north, but what are your members doing to try to deal with that issue?

It may actually lead into this, but I'd like to talk about education and training and how you are participating as part of that. We've had various suggestions of what might work in remote communities and other places, in aboriginal communities, trying to get them engaged. So I'm just interested in your thoughts on that.

Mr. Amos, if you want to participate in this as well, I'd be glad to hear your thoughts on the development of human resources and then how we deal with education and training.

Go ahead.

[The Chair, Conservative, Leon Benoit]

We can start with Ms. Briño and just move down the line.

Go ahead, please.

[Karina Briño]

Thank you for the question.

The latest statistics, at a national level, indicate that Canada will need about 112,000 skilled workers for the mining sector alone. It is estimated that about 10% of those are going to be located in British Columbia. So the issue for us is significant in the sense that we are actually running out of time to get ready, if projects are going to get approved. We have not hit the point where businesses are getting stalled because we don't have the workers, but companies are having to go abroad to look for that skilled workforce.

In terms of what the industry is actually doing, the foreign worker program is certainly helping in terms of meeting the immediate need, but we continue to look for opportunities to provide training and capacity development at a local level. This is where aboriginal training opportunities come into play and continued funding both at the federal and the provincial level, in addition to industry contributions, are very important.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Do you have any specific examples of things that have worked well?

[Karina Briño]

Absolutely.

Currently two sorts of partnerships have been created in B.C., one in the interior and the other one in the northwest, to increase aboriginal participation in the industry but also to create capacity for their own respective communities.

One is the School of Exploration and Mining in the northwest. They provide environmental monitoring training for aboriginal youth. These youth are actually working in both the industry and their own bands. They become the environmental monitors for them. So it's not industry-specific training, it's environmental monitoring training. Those skills are very transferable. They can be applied to different sectors.

In the interior right now, there is a very strong partnership that is at risk, if I may say, as a result of federal funding not having been approved yet. If I could put in a pitch for that, it's something that I would be very interested in.

This partnership is creating training opportunities and job opportunities for underground mining in the Kamloops area. We do have a mine that is about to open up, the New Afton mine, in the Kamloops area. This particular program, the British Columbia Aboriginal Mine Training Association program, is essentially preparing the future workers for that particular mine. The industry has come to the table with funding and money. We just need to figure out how we're going to get the additional funding that used to come from the federal government and that now isn't there—yet.

In terms of other initiatives, the industry has come together over the last few years to develop a strategy to deal with the workforce shortages. We've been successful to a certain extent, but things are happening fast. As I said, the concern is that we will have to continue to look abroad, which is not the ideal resolution to the problem, as we would like to create those opportunities for, in our case, British Columbians.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

I'm just about out of time here, so I'm wondering, Mr. Macdonald, if you could you go next, because you are in the north.

Then maybe we could work our way back.

[Gordon Macdonald]

Our target is aboriginal people in the north for employment. Our greatest success has probably come through mine training societies and apprenticeship programs, but first and foremost is just a stay-in-school program to help kids stay in school and get at least a grade 10, and preferably a grade 12, education.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Are you actively involved in that?

[Gordon Macdonald]

We are actively involved in that, yes.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

What are you doing there?

[Gordon Macdonald]

A lot of it is mentoring. We go to high schools, elementary schools, teaching them what a career in mining can be about. It's role modelling through people in the community who already work at the mine and who go back and tell people what working in mining is about.

It seems to be working. We've been able to successfully keep about a 30% aboriginal employment level at the mine site. It was easier in an open-pit operation. As mentioned, we have transitioned to underground, so we're going back again. We have to go through a whole new retraining program to bring people underground.

[David Anderson, Conservative, Cypress Hills—Grasslands, SK]

Are you seeing a difference in the next generation? Do you see a different impact on the young people from when you first arrived?

[Gordon Macdonald]

I think so, but I actually think more young people are looking to leave than to stay.