Natural Resources Committee on Sept. 25th, 2025

[Kimberly Lavoie]

The British Columbia Environmental Assessment Office conducts assessments that are for both Canada and B.C. at the same time. Canada relies 100% on the information that B.C. provides in order to be able to make its decision.

[Ron McKinnon, Liberal, Coquitlam—Port Coquitlam, BC]

Thank you.

As you know, reconciliation day is coming up. How can the development of critical minerals in Canada present benefits for indigenous people? Are there any projects that are going to facilitate indigenous-led operations and indigenous equity?

[Kimberly Lavoie]

The short answer is that there are lots of opportunities for indigenous people and all Canadians. I would say that, in the natural resource sector, about 70% of all natural resource projects are within 100 kilometres of an indigenous community. For many of these communities, it is the only source or the major source of income.

In the critical minerals space, there are a number of projects where we are working really closely with indigenous partners and where indigenous folks not only get benefits from an impact and benefit agreement with the company but also have opportunities through programming in the federal government like the indigenous natural resource partnerships program. They also have opportunities for an equity stake in a project, and the indigenous loan guarantee program is designed to enable indigenous equity and a long-term revenue stream coming out of those investments.

[Ron McKinnon, Liberal, Coquitlam—Port Coquitlam, BC]

Thank you.

A lot of our projects are in the southern part of Canada, but I think that the Northwest Territories and Nunavut represent a huge opportunity that is relatively undeveloped. Do you have any idea what kind of opportunity exists up there in the Far North?

[Isabella Chan]

The mining projects that are available are on Natural Resources Canada's website. There's a map where you can find the various projects. It may be of interest to you to know that, with the critical minerals infrastructure fund, we supported a number of infrastructure projects in the north to support the projects that come online but also the communities as well.

[The Chair, Liberal, Terry Duguid]

Thank you.

Before we go to Monsieur Simard, colleagues, I think you know that we are being televised. I believe my mother is watching, so I'm going to be on my best behaviour. I know Canadians are very interested in this topic that is of great interest to all of us around the table.

Monsieur Simard, go ahead for six minutes.

[Mario Simard, Bloc, Jonquière, QC]

I wonder why you would say that before I have the floor, Mr. Chair, but I won't make it personal.

[Voices]

Oh, oh!

[Mario Simard, Bloc, Jonquière, QC]

Good morning. First of all, I have a request for you.

Would it be possible for you to table with the committee all the financial support measures offered by Natural Resources Canada? That might help us. You just talked about an equity program for indigenous communities. I would like to have some information on that. If you could do that, I would appreciate it.

Now, when it comes to the critical minerals list, our researchers have done an excellent job of telling us how many critical minerals are on the list. The list was reopened in 2024 and, that same year, phosphate was added to it.

The major problem is that there doesn't seem to be any coordination between you and the Department of Finance. I say that because some critical minerals still don't have the same tax advantages as others. When I talk to the people at the Department of Finance, I ask them what the point of being on the critical minerals list is if there is no tax benefit associated with it.

Have you had any discussions about that?

[Isabella Chan]

I would say, first of all, that tax-related questions fall under the mandate of the Department of Finance and, therefore, I cannot expand further on tax-related questions. That being said, I do want to note that there are a number of other programs within Natural Resources Canada that could support the projects under the 34 critical minerals on our list, up to and including phosphorus.

We have conversations with our mining project proponents on an ongoing basis, and currently the second call for proposals under the critical minerals infrastructure fund is still under way and is open for applications.

[Mario Simard, Bloc, Jonquière, QC]

Thank you very much.

It's true that the regulatory aspect is problematic, but there's also the fact that the department may not be nimble enough. That's what I've heard from people in the mining sector. For an early-stage mining project, the challenge is to get to the feasibility study. Some people call it crossing the valley of death. To do that, you already have to have a financial structure that allows it, and since this is often done in such a way that you can't use the money for the feasibility study, there's a barrier.

I know that companies that mine minerals considered critical receive a significant boost, particularly because of the tax benefits associated with them. However, I think it would be entirely in your interest to have discussions with the Department of Finance to make it simpler, since a number of people thought that including them on the critical minerals list meant that they would have tax benefits afterwards. If you have any information on that, I would appreciate it if you could table it with the committee.

On the other hand, in your opening remarks, you talked about the rare earth reserve in Canada. A little later, we'll be hearing from people who have a rare earths consortium project that would enable them to pool risks and thus facilitate the development of this sector, which is quite complex.

What kind of funding does Natural Resources Canada provide for research and development projects aimed at reducing risks prior to market entry?

[Isabella Chan]

Thank you very much.

You've raised a number of issues, so I'll try to address them all.

Before I answer your question about rare earths, I would like to note that we can give you a list of the programs that support projects related to critical minerals.

I would also note that my colleague here, Mr. Ghattas, runs the critical minerals centre of excellence, which supports our mining projects in navigating the regulatory processes. NRCan is not a regulator of mining projects. That is actually under Fisheries and Oceans, Environment Canada and our impact assessment agency. However, we do provide support to navigate the regulatory process. I would also note that through the services that we provide, we also discuss the programming that's available.

To your other question regarding rare earth elements and what kind of support we provide, first of all, I would note that there is the critical minerals research, development and demonstration program. Under that program, we have already funded Cyclic Materials for their demonstration plant. We've also supported Ucore in the commercialization of their technology. Another important one that I mentioned during my opening remarks was the Saskatchewan Research Council. It has a facility that's doing rare earth metals.

Then on the recycling side, too, let's not forget that we often think about critical minerals as mining projects, but actually, the whole value chain includes recycling as well as processing. Many of our critical minerals are actually by-products of processing that we do. We have also funded Geomega Resources for their recycling and production of rare earth oxides.

From a mining perspective—rare earth elements—we also have supported Torngat Metals and Commerce Resources as well as Defense Metals for their infrastructure projects. Much of this is available on our website, and I'm happy to provide it to the committee.

Thank you.

[The Chair, Liberal, Terry Duguid]

Thank you, Ms. Chan.

We're now going to go to Monsieur Malette for five minutes.

[Gaétan Malette, Conservative, Kapuskasing—Timmins—Mushkegowuk, ON]

Thank you.

You've talked about programs that are in place to help the industry. I look at the rare earth mineral lithium. In 2023, there were 520 tonnes produced, but Canada has identified reserves of 930,000 tonnes of lithium. Australia produced 74,000 tonnes of lithium. Chile produced 38,000 tonnes and China produced 22,000 tonnes.

How do we compete with these large producers, and how do the programs that you have talked about help us? Now we produced 520 tonnes in 2023. We're in 2025. Would you be able to tell us how we've progressed with those programs in the last two years?

[Isabella Chan]

I would address that question first by noting that we have a number of advanced projects with the ability to produce lithium that we're tracking, monitoring and supporting. I'm happy to provide the list of those projects to the committee here for your study.

There are a couple of things that we're doing. Number one, as I noted, is that the centre of excellence is providing support in navigating the regulatory process, as well as our programming. Number two is that some of these projects are in remote areas where infrastructure is needed to bring the minerals online. Therefore, through our critical minerals infrastructure fund, we are supporting those projects.

Number three is that lithium can be mined. There is also technology being developed domestically to actually extract lithium from brine. Through our critical minerals research, development and demonstration program, we are funding technology related to that.

[Gaétan Malette, Conservative, Kapuskasing—Timmins—Mushkegowuk, ON]

Thank you.

How long do you think it will take us to catch up to the largest producer of lithium—Australia—with our programs?

I know you will give us information, but we have a lot of work to do.

[Isabella Chan]

In addressing this question, I would note that through our presidency under the G7, we did announce the critical minerals production alliance, where we are trying to bring together the demands from our G7 allies and bring forth our production here, domestically, to showcase what Canada has to offer. That work is under way in order for us to address not only our ability to bring our mining projects online faster, but also the demands that our allies need.

I think there is definitely more work that needs to be done, especially because of this market where many of our projects are facing price volatility. It is not just a matter of going through the regulatory process; it's also the challenge of raising the capital needed to bring our projects online. As such, initiatives like the critical minerals production alliance, as well as our programming, including the indigenous loan guarantee program, are important for supporting some of these projects, especially when it comes to the capital market and the ability to raise that capital.

[Gaétan Malette, Conservative, Kapuskasing—Timmins—Mushkegowuk, ON]

Thank you.

You have mentioned infrastructure. Sixty-six per cent of industry representatives flagged the lack of infrastructure as a major barrier to investment. I know you talked about the infrastructure fund.

How do companies reach out to that fund?

[Isabella Chan]

I'm going to address it by first saying that the critical minerals infrastructure fund was launched last year and we already have announced over 30 projects that are now going to be funded under that fund.

On the importance of infrastructure, we do know there is a need. As such, the critical minerals infrastructure fund set aside $1.5 billion to support infrastructure.

Since last year, we closed the first call for proposals. We're in the midst of now looking at the second call for proposals. We are working with our provincial and territorial partners to identify priority projects and to fast-track the assessment, too. We do know the infrastructure needs are there and we are trying to address that as quickly as possible.

[The Chair, Liberal, Terry Duguid]

Thank you, Monsieur Malette.

We'll now go to Mr. Hogan.

[Corey Hogan, Liberal, Calgary Confederation, AB]

Thank you, Mr. Chair, and thank you all for being here today. As a former public servant, I greatly value your contributions. I have a deep appreciation for the knowledge and expertise that you bring. I am so glad we get to direct some of that toward this study.

Some of the items that we're looking at, as my colleague, Mr. Malette, was mentioning, include infrastructure solutions. Like Mr. Simard was mentioning, we're looking at barriers. We're broadly looking at ways that government can support domestic production and processing.

Natural resources, of course, are in the provincial jurisdiction. That is hard fought in some cases, as it was in my home province of Alberta. I am sure nobody on this committee wants to step on that, but there is, of course, a federal role with tax policy, trade measures, environment, industrial policy, the effects on demand that those policies create, strategic purchases, indigenous relations and more. It's a lot and it would be easy to lose focus, given that sort of broad touching of the area.

I'm hoping you can expand on your views of the federal role and tell this committee the most important thing that we can do to direct our efforts toward supporting domestic production and processing.

[Isabella Chan]

I would note that collaboration with our provincial and territorial partners is essential to natural resources development, because natural resources development falls within provincial and territorial jurisdiction. There is good collaboration under way at the officials level. There is the intergovernmental working group, where my colleagues from the provincial and territorial governments get together on a regular basis to go over our priorities. As I noted, too, under the critical minerals infrastructure fund, we solicit input directly from the provincial and territorial governments to identify which infrastructure projects would be most beneficial and would support priority projects within each jurisdiction.

Finally, in July, we had our energy and mines ministerial conference, at which Minister Hodgson, along with other ministers, talked about various important priorities that we can advance together collectively.

[Corey Hogan, Liberal, Calgary Confederation, AB]

Where do you think we could put our focus? What would provide the most benefit if we focused on it?

[Isabella Chan]

Number one is that the challenge many of our project proponents face is raising capital. You would have noted that Natural Resources Canada, working with our provincial partners, has co-invested in projects, one of which is the B.C. highway project. Another one is the transmission line of the B.C.-Yukon grid. That falls under the critical minerals infrastructure fund, which is very much looking at collaboration and maximizing every dollar that we spend to ensure they are spent in the right areas and on the right projects.

Another focus is looking at every part of the value chain. As I noted before, let's look at the rare earth elements value chain. It is not just a matter of getting ores out of the ground; it is also supporting the technology necessary to do the separation all the way to permanent magnets. How we can support many of these nascent industries here domestically to bring them into the commercial scale would be another area of focus.

Coming back to the question, looking at every part of the value chain would be important.

[Corey Hogan, Liberal, Calgary Confederation, AB]

Thank you. That was very helpful. I appreciated your comments about coordination with the provinces and territories. We would all agree that is totally essential.

You noted in your opening remarks, Ms. Chan, that 15 departments or agencies coordinate activity in this space. In a practical sense, how do you keep them coordinated? Maybe I'll illustrate with a story from a stakeholder I met yesterday, who said that ECCC and DFO provided different lists of indigenous groups that they wanted consultation with. I have worked in government. I know it can be tricky, and I know NRCan is not at fault here, but if you could speak to the internal coordination role that government needs to play and your view of how it's working, I'd appreciate it.