Good afternoon, Mr. Chair and committee members. My name is Richard Moore, and I am a representative of the Prospectors and Developers Association of Canada. I am a PDAC board member and I am the chair of the geoscience committee. I am also a consulting geologist with more than 40 years of experience internationally and in Canada.
I am here with my colleague, Scott Cavan, PDAC program director for aboriginal affairs. Thank you for providing us with an opportunity to meet with you today.
The PDAC is a national association, formed in 1932, whose members are involved in the mineral exploration and development industry both in Canada and around the world. Our membership includes over 1,000 corporate and more than 7,000 individual members, comprising mining companies, junior exploration companies, service and consulting firms, geoscientists, prospectors, students, and the financial and investment sectors.
The PDAC organizes an annual convention in Toronto, which is the world's premier mineral industry trade show and investor's exchange. In 2011, our convention attracted over 27,000 delegates from over 100 countries.
The geoscience knowledge provided by federal, provincial, and territorial governments as a public good is widely acknowledged to be one of Canada's competitive advantages in attracting mineral exploration and to have contributed to this country's standing as a leading mineral producer.
It is also essential for maintaining Canada's role as the leading destination for exploration investment. Since 2004, Canada has been the number one country for attracting global exploration, attracting a share of between 16% and 19%.
Geologic mapping is the basic research tool needed for finding evidence that geologic forces have led to a concentration of resources that are economically viable. Geomapping is fundamental for a company to decide where to focus its exploration activity.
Most mineral resources in Canada are public assets. The responsible development of these resources is in the public interest. It creates jobs, sustains communities, and contributes to Canada's GDP. Public geoscience stimulates exploration and is a key element of federal, provincial, and territorial strategies.
Government geoscience plays an important role in mineral exploration in Canada.
Mineral exploration and development differ from most other economic activities, as mineral deposits are where you find them. It takes many years and lots of money to determine whether a mineral deposit can turn a profit, and it is a high-risk business.
Government geoscience is important. It attracts exploration investment by helping companies to identify areas of favourable mineral potential. It makes exploration efficient and more effective. By reducing exploration costs and risk, public geoscience attracts investment, creates jobs, and increases government revenues.
There is documented evidence that government geoscience stimulates mineral exploration. Program evaluations suggest that six out of ten mapping projects have immediate impact in terms of claims staking and new exploration activity.
There is also data that highlights the return on investment for geoscience research. Natural Resources Canada data suggests that while incremental increases in exploration expenditures are difficult to quantify, every $1 million of government investment to enhance geoscience knowledge will stimulate $5 million in private sector exploration expenditures.
Geomapping has played a critical role in the past and present successes of the Canadian mining industry. It was at this time of year 119 years ago that J.B. Tyrrell was canoeing home from his geomapping program along the western shore of Hudson's Bay. His had been a voyage of discovery, travelling by canoe into the eastern Barren Lands of the Canadian tundra, an area where no European had travelled since Samuel Hearne in the 17th century.
J.B. Tyrrell was an officer of the Geological Survey of Canada, and his were some of the first geomapping expeditions of the geological survey in the north, which led to the eventual understanding of the geology of the eastern Barren Lands.
Where are we today? The same region explored by J.B. Tyrrell is home to Nunavut's only producing mine, the Meadowbank gold mine. Its discovery was the result of many years of prospecting and exploration work by geologists using maps of the Geological Survey of Canada.
The Meadowbank mine employs about 500 people, and in 2010 it contributed almost 12% of the territory's GDP. The mine is owned by Agnico-Eagle Mines Limited, which by the end of 2010 had spent $1.26 billion on the project. The mine entered production in June 2010 and has an estimated reserve of 32.2 million tonnes grading 3.5 grams per tonne of gold.
Before the development of the mine, the unemployment rate in Baker Lake was at 50% or higher, and there were few opportunities for economic development. The company enacted policies to give preference to local suppliers, sponsored community events and organizations, and provided as many jobs as they could. Employment at the mine and related service jobs significantly lowered the unemployment rate and provided a huge economic boost to the community, bringing with it improved lifestyles.
This is just one example of how government-supported geoscience has translated into the development of a mine that produces tax revenues, contributes to the Canadian economy, supplies jobs and training, and offers a higher standard of living for local communities, including aboriginal people. There are many more examples like the Meadowbank mine. They demonstrate that the future of Canada's continued dominance in the exploration sector rests upon continued and increased investment in geomapping and scientific research.
In its pre-budget submission to the House Standing Committee on Finance, the PDAC has recommended that the Canadian government continue to invest in the geomapping for energy and minerals, or the GEM, program and the targeted geoscience initiative, or the TGI. These programs have provided important geological knowledge that will undoubtedly result in significant exploration success. The government has planned on continuing these programs. The PDAC supports this decision and recommends that the funding for these research programs remain a firm commitment in future budgets.
Both the geomapping for energy and minerals program and the targeted geoscience initiative are multi-year programs that have been funded for several years. The annual costs to the federal government are $22 million for GEM and $5 million for TGI.
The information gathered from these programs increases the knowledge of Canada's natural resources; encourages mineral exploration and mine development; contributes to economic development, particularly in the north; attracts investment; and contributes to the professional development of geology students.
Geomapping is building the technical exploration infrastructure for the future, for the continued success of the Canadian mineral industry and the economy.
Thank you, and I would be pleased to answer questions.