Exploration spending expected to fall
Natural Resources Canada projects decline of 9 per cent
Karen K. Ho
Northern News Services
Monday, November 16, 2015
NORTHWEST TERRITORIES
Forecasts from Natural Resources Canada show exploration and deposit appraisal spending is projected to decline nine per cent in the territory.
By comparison, Nunavut is projected to have an increase of 28 per cent.
The semi-annual report shows the amount of exploration and deposit appraisal expenditures in the territory is projected to be $93 million down from $101.7 million in 2014, a difference of $8.7 million or nine per cent.
Up $73.6 million
According to the latest report, the significant majority of spending in the NWT this year is expected to be for diamonds, estimated to be $76.7 million or 82.5 per cent. This is up from $73.6 million last year.
Junior companies in the NWT are projected to dominate exploration spending at $52.7 million which is 57 per cent of the 2015 total.
In the NWT, $52 million or 56 per cent of the spending is projected to be on grassroots exploration, the remainder on deposit appraisal.
According to the NWT and Nunavut Chamber of Mines, as a share of projected Canadian investment, Nunavut remains in fifth place and the NWT rises to seventh place from last year.
National Resources Canada projects that total Canadian exploration and deposit appraisal expenditures for 2015 will be $1.9 billion, a decrease of seven per cent from $2 billion recorded last year.
Cancelled exploration
Many companies, such as Avalon Rare Earths, have chosen to suspend or cancel exploration projects in the territory this year.
In a news release issued Nov. 3, the company said a preliminary economic assessment was scheduled for completion before the end of the month.
Even before these new estimates were released, Mining Association of Canada president Pierre Gratton said the territory was at risk of deterring exploration when a draft of the government's conservation plan was released. The draft proposed 40 per cent of the territory's land be designated for conservation.
Mining proponent cautions against negative signalling
"Let's make sure you don't send the wrong signal to the exploration community so that they will look ... and see uncertainty," Gratton said during a NWT and Nunavut Chamber of Mines luncheon at the Explorer Hotel in September. "And think, hmm, I think I'm going to go to the Yukon or I think I'm going to go to Nunavut or Zambia or Australia because I'm not sure what's going on."
He said the territory currently "appears to be a bit complacent."
"The NWT has to think about what's next," Gratton said. "There's not a lot more in the pipeline."
The president said all of the diamond mines in the territory were discovered before 1998 and he said that last year, exploration spending fell to $96 million (approximately half of the amount registered in 2007), much less than Nunavut and Yukon.
"That's what makes the proposed all-season road to the diamond region so important," Gratton said.
