What were the primary takeaways from this year's PDAC Convention?
The 2024 Prospectors and Developers Association of Canada (PDAC) convention had the strongest attendance we have seen in over a decade, with nearly 27,000 participants gathering in Toronto. Notably, there were 1,100 exhibitors and more than 100 hours of programming that covered everything from the highly technical, environmental, and social issues, as well as the personal connections and interactions that thread through our industry.
We also saw global awareness of the event grow, with 138 different countries represented, adding to our ecosystem of exhibitors, networking, and affiliated events. Additionally, more than 20 nations participated in our 9th annual International Mines Ministers Summit. Next year’s convention, set for March 2-5, 2025, will build on this momentum.
What are the key factors that can sustain Canada's leading global position in mining?
It has taken decades to build up the financial ecosystem that supports our mineral exploration companies getting access to the market and attracting capital to make new discoveries. The knowledge base within institutional and individual investors, market brokers, and all the connection points in between have been wrought through more than a century of building up our mineral exploration and mining industry.
To complement this ecosystem, we have highly effective and unique investor incentives like flow-through shares and mineral exploration tax credits that boost Canadian competitiveness, economic activity, and productivity. The longevity of these incentives is key to sustaining our top rank in the world and we hope the Government of Canada commits to permanently enshrine the flow-through regime and mineral exploration incentives in Canadian fiscal policy.
Why did the government renew the mineral exploration tax credit for only one year?
The government's decision to renew the METC for only one year was surprising and disappointing. The METC is an incredibly effective made-in-Canada incentive, which has attracted billions in domestic investments over the past two decades. A long-term commitment will provide the certainty and stability the Canadian mineral exploration sector needs to compete on the world stage in a challenging capital environment. That's why PDAC is calling on the government to renew the policy for at least a five-year term, as it did in 2018.
Can you provide updates on PDAC’s sustainability activities, such as the GHG Emissions Calculator?
Since we last spoke, we have launched the greenhouse gas emissions calculator, which has received positive feedback. This tool helps mining explorers assess their greenhouse gas footprint, including their activities on the ground and in the air that represent significant contributors to CO2 emissions during exploration.
We will need time to gauge the calculator’s full impact, but the initial response has been encouraging. The tool aids explorers in understanding and communicating their environmental footprint, aligning with our broader sustainability and transparency initiatives.
We also have a webpage dedicated to our land disturbance research and some of its findings. We’ve worked with the Government of Canada and regional partners across the country to share the methodology, and we expect to see more quantitative tracking of industry activities in the future.
Industry-Indigenous relations are a priority for the association. The Indigenous program at the PDAC Convention is a bridge between industry and Indigenous peoples. The program was amazing this year, with topics ranging from Indigenous leadership in mineral exploration, environmental assessment and monitoring, as well as collaboration in social development and emergency responsiveness. It also branched out to include a collection of sessions integrated with both our Capital Markets and our Sustainability programs. This combination proved to be a big hit for our attendees, as it was standing-room-only in most of these sessions!
Do you see Canada's reserves of critical minerals like lithium and rare earths being exploited in the near future?
Canada is a small producer of lithium in concentrates. However, rare earths present a more significant challenge. The main issue is refining these minerals after extraction. Rare earths require complex refining that Canada has not fully mastered.
PDAC is eager to champion investment in refining technologies for both lithium and rare earths. While Canada can produce concentrates, extracting the actual metals remains both economically and environmentally challenging.
What, in your opinion, is the driver behind the all-time highs of gold prices today?
A price climb of this magnitude, with gold up nearly 20% from last year, is almost always due to a combination of factors, and that is likely the case here. Market uncertainty fluctuations, bond yields and inflation moving higher over several years, global economic and security risks on the rise, combined with rising physical demand by some central banks and individual investors in emerging markets, has all pushed the gold price higher.
In particular, the rise of the middle class in Asia has contributed to increased gold purchases. A growing middle class is investing in gold as a luxury and a secure investment. Looking ahead, while a global decline in interest rates could weaken gold prices, the price of gold has recently broken through the $2,000 US cap, suggesting continued strength in the mid to long term.
What about uranium? How do you interpret the Biden administration's ban on Russian uranium?
The spot price of uranium has more than quintupled in the last two years, and the price is likely to remain strong in an environment where governments around the world increasingly look towards nuclear energy to curtail emissions. Within this environment, any new restrictions will lead to an even tighter market.
Current US policies seem more focused on uranium enrichment than on the metal itself. Although Western restrictions may limit Russia's uranium sales to some countries, the supply of natural uranium metal is not likely to significantly decrease but be redirected.
In Canada, our nuclear fleet operates on natural, unenriched uranium, unlike the US, which primarily uses enriched uranium. With the US looking to reduce reliance on Russian uranium, there is a potential opportunity for Canada to develop enrichment facilities, especially if the appropriate supply chains are supported by government initiatives.
If you could resolve one policy issue for the mining industry in Canada, which one would it be?
Speeding up the pace of discovery and mine development is the one area we must focus on in Canada to achieve the goals of our national critical minerals and emission reduction strategies. This doesn’t mean we shortcut permitting or assessments, but it does mean we need to see more collaboration between governments, industry, and communities to bring new projects online and provide the raw minerals we need to transform the way the world works.
Permitting is one of the issues, but financing is another significant challenge. Even with a fully permitted mine, securing the necessary financing to move forward remains a hurdle. Addressing both permitting and financing issues is essential to expedite the development of new mining projects.
