TORONTO, ON—Mining industry executives rate Quebec as the world’s most attractive jurisdiction for mineral exploration and development for the third straight year, according to the annual
Survey of Mining Companies 2009/2010, released today by the Fraser Institute, one of Canada’s leading public policy think-tanks.
“Mining executives say Quebec remains an international standout for investment because its stable government policies offer them the certainty that reduces risk for long-term projects,” said Fred McMahon, coordinator of the survey and the Institute’s vice-president of international policy research.
But while mining executives put Quebec at the head of the class in Canada, they have a much less optimistic view of Ontario and British Columbia, citing multiple layers of regulation, little coordination between various government agencies, and uncertainty around aboriginal land claims.
Both Ontario and British Columbia, two provinces with a lengthy history of mining, fell significantly in this year’s survey. Ontario is ranked 22nd overall, down from its 10th place finish last year, while British Columbia is even further back at 38th, dropping 14 places from the 24th spot in 2009.
“Ontario’s recent throne speech indicated Dalton McGuinty’s government is open to the idea of increased mining in Northern Ontario, but based on responses from the mining industry in this survey, the government has substantial work to do at fixing policies that the industry perceives as discouraging mining,” McMahon said.
The Fraser Institute’s
Survey of Mining Companies: 2009/2010 represents the opinions of 670 mining executives and managers worldwide on the policy and mineral endowment of 72 jurisdictions on all continents except Antarctica. Companies participating in the survey reported exploration spending of US$2.9 billion in 2009 and of US$3.6 billion in 2008.
Last year’s survey showed significant pessimism towards new mining investment, but this year’s survey reveals a strong rebound in optimism. Almost twice as many miners plan to increase investment as hold it steady or decrease it, with 83 per cent of miners saying mining prices will rise and 20 per cent expecting substantial increases.
The Canadian picture
Aside from Ontario and British Columbia, Canadian jurisdictions fared well in this year’s survey with Canadian provinces taking up six of the top 10 spots. New Brunswick is ranked second overall, an increase of four places since 2009. Alberta remained in fourth place while Saskatchewan rose three spots to sixth. Newfoundland & Labrador is ranked eighth, a decrease from fifth last year, while Manitoba is ranked ninth overall. In 2007, Manitoba was ranked first overall.
Rankings for other provinces and territories are: the Yukon in 11th, Nova Scotia in 16th, Nunavut in 43rd, and the Northwest Territories in 50th.
Significant international developments
Finland is the top international jurisdiction, ranked third overall. Other jurisdictions in the top 10 include perennial favourite Nevada at number five; Chile, the only Latin American country ranked among the top 10, at number seven; and South Australia, the highest-ranked Australian jurisdiction, at number 10.
Other highly ranked non-Canadian jurisdictions include Sweden (12th overall), Wyoming (13th), Utah (15th), and Alaska (18th).
Among Australian states, South Australia is followed by the Northern Territory in 14th, West Australia in 19th, and New South Wales in 20th.
Chile is the top-ranked Latin American nation in seventh spot overall. It’s followed by Mexico (28th), Peru (39th), and Brazil (40th ).
Botswana is the highest-ranked African nation (21st), followed by Mali and Ghana in the 27th and 34th spots, respectively.
The bottom 10 scores belong to Venezuela, Ecuador, the Philippines, Zimbabwe, Democratic Republic of Congo, Mongolia, Bolivia, Honduras, Guatemala, and California.
“Respondents say California’s staunchly environmentalist policies create a strong deterrent to investment by interfering with mining practices that are proven to be clean and responsible. Unfortunately, the rest of the worst-ranked jurisdictions are developing nations that urgently need the new jobs and economic prosperity mining can create,” McMahon said.
“In order to attract mining investment, jurisdictions must uphold the rule of law and respect negotiated contracts and property rights. Jurisdictions that fail to do so can not compete successfully on a global scale.”
Optimism on the rebound
Last year’s survey presented a gloomy outlook for the mining industry. This year the outlook is much more optimistic, with almost twice as many mining companies saying they will increase exploration budgets as those who said their budgets will remain the same or decrease. The majority of respondents also expect mineral prices to increase over the next two years, with 64 per cent forecasting a moderate rise and 20 per cent predicting substantial increases.
“As economic recovery takes hold, we’re seeing greater optimism from the mining industry in terms of new explorations and long-term projects,” McMahon said.
