Manitoba’s mining industry praises nod in federal budget

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This article was published 31/03/2023 (889 days ago), so information in it may no longer be current.

WINNIPEG — This week’s federal budget included an emphatic acknowledgment from the Trudeau government of the importance of the mining industry in this country, in particular the extraction and processing of so-called “critical minerals.”

Measures announced in the budget including tax credits for new equipment and machinery used in the mining and processing of critical minerals, money allocated for Indigenous investments in major projects as well as a commitment to improve the efficiency of the impact assessment and permitting processes for major projects should all benefit the provincial sector.

As well, before the budget the government announced the creation of funds first mentioned in the 2022 budget that will allocate $1.5 billion toward energy and transportation projects needed to unlock priority mineral deposits in remote locations.

With more than 10 separate lithium exploration projects underway in the province — lithium is a mineral that is essential in the manufacturing of batteries, for instance, like the ones used in all electric cars — the province has the potential to position itself in the middle of a much-needed North American supply chain that’s being created right now.

John Morris, the executive director of the Mining Association of Manitoba, said, “I don’t want to put the cart before the horse, but we are looking for the potential development of refining capacity for lithium here in Manitoba and we would like Manitoba to be a processing hub for lithium going forward. How this budget will play into that, we will see.”

While the tax credit for new equipment does not help exploration companies — typically they do not own equipment and exploration companies are not profitable and don’t pay taxes so a tax credit does not help them — industry players appreciate the support.

Christina Barnard, the vice-president of operations with Foremost Lithium Resource & Technology, a company that has just finished a recent drilling project at a property near Snow Lake, Man., said she’s yet to do a deep dive into the programs, but she said, “Everything sounds exciting. We’ll try to figure out what it means to us.”

The budget provides more than $1 billion in new supports for Indigenous governance, capacity, participation in decision-making and conservation under the heading, Supporting Indigenous Economic Participation in Major Projects.

MaryAnn Mihychuk, executive director of the Manitoba Prospectors and Developers Association, said she hopes the signalling from the federal government will encourage more partnerships with First Nations.

“The world has changed,” she said. “All those projects moving ahead will be in partnership with Indigenous people of the area and to provide some funding to make that happen is essential.”

Christian Sinclair, the former chief of Opaskwayak Cree Nation, now works with bands to negotiate partnerships with resource companies. He is in the middle of discussions for an industrial benefits agreement between Alamos Gold Inc. and Marcel Colomb First Nation regarding a potential gold mining operation in Lynn Lake.

He said making financing available for First Nations to become equity partners in major resource projects is an important step.

“It would provide the impetus that a lot of First Nations lack because of the Indian Act, which I call modern-day economic sanctions,” he said. “If this federal program will provide resources for First Nations to be part of the ownership of these major projects … then it sounds like a good start. It recognizes that it’s the way to make the country move forward in a good way.”

The federal budget’s focus on mineral developments follows $420 million of infrastructure investment in the North that the province made earlier in the week.

Chuck Davidson, the president of the Manitoba Chambers of Commerce and one of the leaders of the current Tory government’s Look North strategy, said there is good momentum for the region these days.

“There are opportunities for us,” he said. “It will be a matter of taking advantage of it.”

Among other things the province is planning to spend nearly $250 million to improve five existing roadways to improve safety and improve year-round connectivity between northern communities.

“That will play into the industry’s ability to transport mineral that has been extracted,” Davidson said.

» Winnipeg Free Press

But with the entire world scrambling to develop critical mineral resources to feed into the electrification supply chain, there is plenty of urgency right now.

“It is a matter of who can get the exploration done and move the project along as quickly as possible to get it to the point where it becomes profitable,” Davidson said. “The message being sent from provincial and federal government is that these critical minerals are essential.”

» Winnipeg Free Press