TORONTO (miningweekly.com) – The Prospectors & Developers Association of Canada (PDAC) has lobbied the federal government during its nationwide prebudget consultations to take action and improve the flow of capital to the junior exploration sector, as well as to address the infrastructure deficit in northern and remote Canada.
According to the PDAC, financing for exploration had fallen more than 90% since 2007, underlining the importance of policy tools that encouraged investment in exploration and ensured that the money raised was spent in Canada.
“A healthy junior mineral exploration sector is vital to the continued prosperity of Canada’s minerals and metals industry – an industry that contributes 4% of GDP [gross domestic product] and employs over 375 000 workers across the country. Canada’s junior mineral exploration sector is world-class, and has made 70% of all discoveries in Canada over the last ten years,” stated PDAC president Rod Thomas.
While the minerals sector is a key driver of the Canadian economy, it currently dealt with challenges that threatened its ability to continue to be a source of economic growth. The industry was in the midst of a prolonged downturn in exploration financing that was having a significant impact on financing available for the junior exploration sector.
“To address this financing downturn, PDAC is calling for the increase of the Mineral Exploration Tax Credit to 30% for a period of three years. This will provide much-needed predictability to investors and foster confidence that will help capital flow back to exploration companies,” Thomas said.
The PDAC was also calling for infrastructure investments in northern and remote regions to support resource development.
Remote exploration projects cost up to 2.27 times more than nonremote projects, while very remote projects faced cost increases that were up to six times more, hindering exploration and economic development in these regions.
The PDAC said it supported the government's decision to establish an infrastructure bank and was calling for dedicated funds for resource-development-related infrastructure projects in remote and northern Canada.