Evidence of meeting #13 for Natural Resources in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was industry.
A recording is available from Parliament.
NDP
Dennis Bevington NDP Western Arctic, NT
Yes. This whole issue of the processing is certainly something that's bedevilling that company as well. I think you probably agree there.
Senior Vice-President, Minerals Services, SGS Canada, As an Individual
Let me just say yes.
SGS has done a lot of their work. They've spent a lot of time and a lot of energy to get to solutions.
NDP
Dennis Bevington NDP Western Arctic, NT
Yes. They've talked about a number of things. Of course, they're still talking about mining and milling in the Northwest Territories, but now it's their hydrometallurgy. They're looking at perhaps moving that out of the Northwest Territories because they need to move it to a supply of sulphuric acid, I believe. Is that it?
February 13th, 2014 / 10:20 a.m.
Senior Vice-President, Minerals Services, SGS Canada, As an Individual
I don't know the specific details for that project. I'm sorry.
NDP
Dennis Bevington NDP Western Arctic, NT
Okay.
The other thought right now is that there are American opportunities for the separation. Are we going to miss an opportunity here if a company like that moves the separation out of this country?
Senior Vice-President, Minerals Services, SGS Canada, As an Individual
I think we always miss an opportunity if companies move out of Canada.
NDP
Dennis Bevington NDP Western Arctic, NT
So there is some urgency to getting together this aspect of what you're talking about here with CREEN, to getting this organization together to provide some assurance for that secondary production to these companies that have invested in developing the mining opportunity. Is that correct?
Senior Vice-President, Minerals Services, SGS Canada, As an Individual
I don't think we can make their economic decisions for them, but certainly, if there were facilities and infrastructure in place to provide what they need in Canada, we would have a much better chance of them staying—
Senior Vice-President, Minerals Services, SGS Canada, As an Individual
—and those are imminent decisions.
NDP
Dennis Bevington NDP Western Arctic, NT
Yes. At the beginning of this process with Avalon, there were great hopes—and they encouraged those hopes—that there would even be secondary processing in our territory, but I think that's off the shelf now.
If they go ahead now with their plan to move that kind of production out of the country, would that...? Once you set up these supply and processing linkages, it's pretty hard to get out of them, I would imagine. Or is it possible that it could change in the future?
Senior Research Analyst, Euro Pacific Canada, As an Individual
Well, if they build infrastructure there, that will be a few hundred million dollars in investment. It would be very difficult to have it coming back to north of that border.
As for what it might do, if there actually is an increase in the future in the development of rare earth mining in Canada, when you have one separation facility there with the capability, it makes economic sense to continue the separation in that area. I think that is actually one of the topics here in terms of a rush to supply. The region that gets the investments in infrastructure for separation and downstream processes will have an advantage and might attract more funding and investment.
NDP
Dennis Bevington NDP Western Arctic, NT
Can the hydrometallurgy take place in Canada now quite comfortably?
Professor, University of Toronto, Chemical Engineering and Applied Chemistry, As an Individual
Right now the technology to separate the rare earth elements exists in China. The Chinese have worked on it for a very long time, and they have the know-how. It is not something that we can't do here in Canada as well, but it is a matter of investing in research and technology, the tweaking that is necessary on the chemistry, to be able to do this. Right now I don't think we have an established technology for how to do that in Canada. We are very close to being there, but we definitely are not there.
That is why this idea of a toll refinery is circulating, where all the companies would make their products at a centralized location in Canada that does the separation. In the absence of this facility, then companies like Avalon make plans to send their material outside.
I would like to add my own understanding on China's advantage here. We have to understand that China dominates the market because they have very easy-to-extract natural resources. It's the nature of the geology there. That's why their cost of production is extremely low. In Canada we cannot compete with the cost of production that exists in China right now. It inevitably will be more expensively here, because the rare earths are locked into more difficult minerals. However, I've been reading a number of resources—and I hope they are reliable—that call for a depletion in the next five to six years of China's easy-to-extract resources, in which case the competition around the world will be more level. Canada hopefully will be there to play a major role in the production.
Conservative
The Chair Conservative Leon Benoit
Thank you, Professor. Thank you, Mr. Bevington.
We'll go now to Mr. Calkins, followed by Mr. Julian, and Monsieur Gravelle.
Conservative
Blaine Calkins Conservative Wetaskiwin, AB
Thank you, Chair. This is my first opportunity to participate in this study. I missed the initial meetings that we had, so I apologize if my questions today are amateur.
This is quite interesting, and I appreciate what you've said. I'm not even going to try to say your last name, sir. Can I just call you Vlad? Is that okay?
Professor, University of Toronto, Chemical Engineering and Applied Chemistry, As an Individual
Vlad is good.
Conservative
Blaine Calkins Conservative Wetaskiwin, AB
What you're saying is that basically China has the easy stuff to get, which is what's giving them the competitive advantage. So from a Canadian perspective...and I know this is a hard thing to ask. It's hard to know what we don't know. From a geomapping perspective, from all of this stuff that the industry has done, that the exploration has done, we know what we have but we don't know what we don't know we have.
What do we think we don't know that we have?
Conservative
The Chair Conservative Leon Benoit
That question's out of order, because I know I didn't get it.
Anyway, go ahead please.
Professor, University of Toronto, Chemical Engineering and Applied Chemistry, As an Individual
I can answer like this. What we know we don't have is the type of mineral deposits that China has. We know that because these types of deposits develop only in subtropic areas around the world. I know that there are European companies looking at identifying deposits around the world that are similar to China's. They're looking in Africa, for example, or other equatorial countries.
So we don't have these easy-to-take-out rare earths. This we know.
Professor, University of Toronto, Chemical Engineering and Applied Chemistry, As an Individual
But we may have other untapped resources around the country that would increase our current knowledge on how much we can produce.
Conservative
Blaine Calkins Conservative Wetaskiwin, AB
There are yet-to-be-explored areas. We can predict, but it still may be better than we think it is, based on what we know today, right?
