B.C. mining generates loss for fifth consecutive year

Although the situation has improved this year, British Columbia recorded its fifth consecutive year of losses in 1986, a Price Waterhouse report concludes. The survey of 30 separate mining companies, which was prepared for the Mining Association of British Columbia, assesses the net loss at $41 million.

Earnings from mining operations totalled $102 million but extraordinary charges of $87 million, government taxes, and royalties amounting to $56 million, generated an over-all loss.

Lower prices for mineral commodities reduced sales revenues by $28 million, which was offset to some extent by increased productivity and slightly lower government charges. Industry cash flow was $333 million, the highest level since 1980 and a 26% increase from 1985.

Total taxes, royalties, and other payments to the three levels of government dropped $27 million to $388 million in 1986. The main components of this decrease were lower property taxes, provincial sales taxes and taxes related to employment.

No major capital expansions occurred in the industry during the year and combined industry capital and exploration expenditures dropped to $207 million, the lowest in seven years.

“The mining industry continues to be the second largest goods producing industry in B.C.,” said Tom Waterland, president of the Mining Association of B.C. And despite lower revenues, he noted that the industry increased its share of total provincial exports to 14.6% in 1986 from 12.6% in 1985 with the coal sector representing 46% of total mine export values.