EDITIORIAL PAGE — There’s no place like home

In the early 1990s, Canadian mining companies flocked offshore to explore and acquire mineral opportunities that were opening up all over the globe.

Chile, Mexico and Venezuela were the early beneficiaries of this global rush; today, Indonesia, West Africa and a number of former Soviet republics are having their day in the sun.

Grassroots targets appeared to be greener on the other side of the world, and many companies believed Canada was overexplored and provided little opportunity for “company-maker” discoveries.

By 1992, exploration spending in Canada had fallen to a low of $382 million, and might have dipped further had it not been for diamond discoveries in the Lac de Gras region of the Northwest Territories. As it turned out, the lure of diamonds drove exploration spending up to $477 million in 1993 and to $628 million in 1994.

Exploration spending directed towards diamonds is likely to remain strong in the years ahead, particularly now that the Canadian government has given the green light for the country’s first diamond mine. Mining analysts who are watching exploration in the region predict that other new mines will be developed in the years ahead. This is good news for northerners, including native groups. The companies that have worked hard in this region should be saluted for developing a new industry that will benefit all Canadians for decades to come.

If the diamond discoveries were not proof enough, the Voisey’s Bay nickel-copper-cobalt find in Labrador convinced Canadians that world-class mineral deposits can still be found at home. This major discovery helped boost exploration spending to roughly $764 million last year, and, based on company spending intentions, an impressive total of $945 million will be spent on exploration in Canada in 1996.

Another encouraging trend is that senior companies are expected to account for roughly $565 million of the 1996 total. It is heartening to see Canada’s majors re-investing in the country’s mineral potential.

In 1995, Newfoundland posted a 40% increase in exploration spending (compared with 1994), while spending in the Northwest Territories increased by 27% over the same period. The Yukon posted a 16% gain, while most provinces remained stable, with the exception of Manitoba, Saskatchewan and British Columbia, where spending decreased.

Natural Resources Canada, which tracks exploration spending, notes that two main targets are attracting the bulk of exploration dollars. This year, as in 1995, the main targets are diamond deposits in Canada’s North and base metal deposits in Labrador and elsewhere. Combined, these represent more than half of the total regional exploration for the Northwest Territories, Newfoundland, New Brunswick and Manitoba.

The increase in exploration spending for base metals is encouraging, as copper, nickel and zinc have been, and continue to be, important cornerstones of Canada’s mining industry. Several years ago, in the heyday of the gold exploration boom (before the Voisey’s Bay discovery), senior mining executives raised concerns about declining base metal reserves and the dearth of companies exploring for new deposits of this type.

It is interesting to note that, despite the view that most of the “easy” deposits have already been found in Canada, the discovery of Voisey’s Bay was triggered by careful examination of a surface showing. Likewise, the diamond discoveries in Lac de Gras resulted from careful examination of surface material that yielded diamond indicator minerals, including the best indicator of all — diamonds.

As Dorothy said of Kansas, “There’s no place like home.”