Once again the Prospectors and Developers Association of Canada has presented a strong case concerning a number of issues at the annual mines ministers conference. Sustainable development was the theme of this year’s conference. However, the most compelling presentation was the PDAC’s reasoned approach to the plight of junior exploration companies seeking financing. What is needed, now that governments have reduced the potential for capital gain, are incentives that can be relied upon.
“Successive federal and provincial governments have attempted to `help’ the mining industry when low commodity prices have weakened it,” says the PDAC in its brief, quoting a letter from one of its members to the minister of finance in order to state its position.
“Most have been beneficial to the industry and we are grateful. Unfortunately, there is a tendency for time delays due to the bureaucratic process of setting up the systems. Consequently, the benefits start to flow at the same time as metal prices return to better levels; the aid is labelled a ripoff and cut out just as metal prices head down.
“There are two messages I want to give you. First, don’t be too generous with the help so that it can be targeted as a ripoff, and second, recognize the time delays, put the package in place and then leave it alone for good and bad times.”
The association went on to discuss more specifically how industry and government can work to restore the vitality of flow- through financing or devise a new incentive system.
Ultimately, says the PDAC, if something is not done quickly, Canada is in danger of losing its unique and demonstrably successful junior mining sector.
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