Strong prospects for mineral explorers in Smithers

Small-town Smithers made an splash at Canada’s largest trade show for mineral explorers last week.

Small-town Smithers made an outsized splash at Canada’s largest trade show for mineral explorers last week, sending more people than any B.C. municipality after Vancouver and Victoria.

“It’s a really important part of our economy here and we have some great folks working in that industry,” said Mayor Taylor Bachrach, who pitched in at the Smithers Exploration Group booth for part of the conference.

A record 8,500 people attended the 2012 Minerals Roundup, and by all accounts they had a lot to talk about.

B.C. mines minister Rich Coleman told conference goers that B.C.’s exploration spending hit an estimated $463 million in 2011—a 35 per cent jump from the $341 million spent in 2010.

That meant a busy field season for Smithers companies in the industry, says Anastasia Ledwon, geologist at UTM Exploration Services.

In its second year, UTM has a regular staff of nine and four contractors. But staff peaked at 156 last July and August, she said, making UTM the fifth-largest employer in the Bulkley Valley.

Smithers is a uniquely collaborative place for minerals explorers to work, she added, with many senior geologists to learn from.

Such mentors are critical to an industry still recovering from a decade-long “crash and burn” that started in the late 1990s, she said.

“It was long enough to drive most people out of the industry. So you’ve got a whole bunch of people who want to retire, a whole bunch of students and there’s a big gap.”

A lot of Roundup is swapping business cards, but it does host several technical talks as well.

One that got Ledwon’s attention was on rare earth elements.

As the name suggests, rare earth elements are seldom found in easy-to-mine deposits. But they are key to expensive high-tech equipment such as lasers, computer memory and nuclear batteries.

China controls nearly three-quarters of the world market, but recent geoscience shows B.C. has all the deposits associated with the stuff.

B.C. holds lots of  “pleasant surprises” for explorers, Ledwon said, as it’s made from multiple land belts that migrated here from across the Pacific.

“They all came sailing along merrily in geological time, whacked into the coast and got squashed,” she said. “So not only do you have all these different types of base rocks that were created in different ways elsewhere, then they were smashed. That gave them a whole lot of pressure, a whole lot of heat, and altered them.”

But high gold, silver and copper prices are driving the majority of B.C.’s new mineral explorations.

Volatility in those prices can shutter small exploration companies almost overnight, Ledwon said.

To stave off some of that uncertainty, the B.C. Liberal government recently announced new flow-through shares that give investors in exploration a 20 per cent tax break.

Speaking at Roundup, Premier Christy Clark also said her government is cutting red tape to make sure the province doesn’t get in the way of exploration and new mines. Some exploration can go ahead without permits, but building camps, laying grids or any other activity that disturbs the surface requires a Lands Act permit.

In September, an FOI request filed by B.C.’s government employees union found some 6,915 permits were backlogged in the province’s natural resources ministry.

Clark said one category, the notice of work permits, has already been cut to 85 from 229. Late last year, the province announced extra funding to  substantially cut the rest of the backlog by the end of the year.

Stikine MLA Doug Donaldson, who also serves as the NDP mines critic, said BC Liberal cuts to frontline staff in the ministry are what led to that backlog in the first place.

“This government getting out of the way has resulted in 8,000 backlogged permits,” he said.

“We’ve had these record-high commodity prices—why is it that we haven’t been able to get some mines going, especially in northwest B.C., for the last ten years?”

Confusion over how First Nations should be consulted over mining and exploration has also hampered the industry, said Donaldson. The Supreme Court of Canada has made clear rulings that show the province holds primary responsibility for such negotations, something he said B.C. Liberals have neglected.

On that file, Premier Clark announced a  new land use agreement at Roundup between the Kaska Dena First Nation and the province.

The agreement covers an area of 7.4 hectares of Crown land from the Dease-Liard region to Mackenzie.

A jobs plan announced last fall by the B.C. Liberal government committed promised that eight new mines would open and another nine mines would expand in B.C. by 2015.