Chamber of Mines recent editorial - In response to Mr. Bromley: Mining is still key to the Northern economy
29 March 2019
Guest editoral by Tom Hoefer, Executive Director of the NWT & Nunavut Chamber of Mines
Northern News Services,It’s virtually impossible to shift the opinions of someone who opposes mining, but to those with an open mind, let me provide some feedback to Bob Bromley’s critique of my recent guest comment.
In regards to his statement on, “… the steep cost of mine site clean-ups to taxpayers,” nobody wants another Giant, a historical mine with no reclamation security. Thankfully, times and rules have changed. Today’s modern mines provide hundreds of millions of dollars in security to ensure reclamation at no cost to taxpayers should a bankruptcy occur.
“… most mine employees reside … outside the NWT.” That’s true. Approximately 52 per cent live in the south. Attracting more Northerners into mining careers can help turn this around. To help, our chamber has launched a miningnorthworks.com website. Check it out! Perhaps now MLA O’Reilly and Mr. Bromley can help us rally for earth sciences in the school curriculum and the polytechnic.
“… leading researchers have termed our resource revenue and royalty rates as being charitable.” Sadly, the leading researcher MLA O’Reilly quoted overlooked $38 million of Diavik’s royalties in his analysis. However, he correctly observed that the mine’s high cost of building winter roads and generating expensive diesel power “shrinks royalty and corporate income tax payments.”
This leads one to conclude that government investment in the road through the Slave Geological Province Corridor and Taltson hydropower will help increase royalties. That’s one reason we support the GNWT in advancing this infrastructure.
“… that all the infrastructure mentioned was largely paid for by taxpayer subsidies.” History doesn’t bear this out. Government paying for infrastructure is an investment, like the bank paying for your house. It’s not a subsidy since you pay the bank back over time. Pine Point is a good example. Over its life, the mine paid off the government’s costs of the Taltson hydropower facility, and even the railway. Both are still serving Northerners long after the mine closed. Thank mining for helping make them possible.
Blaming mining for “a failure to diversify our Northern economy” is a stretch. Government has, and continues to try to diversify the economy, today with farming, fishing, furs and tourism. Any failures to diversify the economy are more likely the high costs of doing business in the North, something our industry also suffers from.
When Mr. Bromley blames mining for creating “a vulnerable economy susceptible to the volatile commodities market,” he ignores the fact that even a diversified economy with farming, fishing, tourism, and trapping is also susceptible to the markets.
Frankly, I’m gobsmacked when Mr. Bromley and MLA O’Reilly blithely observe that vice taxes from alcohol and tobacco are higher than mining royalties. I hope that they are focusing their attention on helping reduce those taxes.
Finally, while I’m not a petroleum expert, when Mr. Bromley criticizes the government’s intent to develop natural gas because “… most of our natural gas today derives from fracking,” I would observe that the natural gas the premier and Inuvialuit are promoting is not fracked gas, rather it is conventional gas from the rich Beaufort Delta fields. With greenhouse gas emissions lower than coal or even diesel, this conventional gas could help arrest climate change.
I know I cannot change someone’s entrenched opposition to mining, but I can try to provide correct information to those looking to make informed decisions. That is my job.
There are over 1,000 mine workers living in Yellowknife, and many businesses that rely on mining. Many are MLA O’Reilly’s constituents. I’m sure they are hoping he looks after their needs when he speaks about the future of mining. I suspect other candidates will.