BACKGROUNDER

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STRONG GROWTH EXPECTED FOR CANADA’S MINING SECTOR

Canada ’s vast natural resources continue to play a vital role in shaping our economy, our society and our place in the world. The future is particularly bright for Canada’s mining sector.

Some highlights about mining in Canada

• Exploration expenditures are forecast to reach a 20-year high in 2007 — almost $2.5 billion.
• Capital investment in mining and mineral processing in 2007 is expected to reach $8 billion, an increase of almost 13 percent from the previous year.
• Almost 40 percent of the global equity financing for mining companies is raised in Canada. More than two-thirds of the world’s mining companies are listed on stock exchanges here, including about 1,000 exploration firms. Canada is “the hub” for mining activities worldwide.

In 2006, the value of Canadian mineral production totalled over $77 billion. This figure includes the traditional value of production from Canadian-mined ores, concentrates and aggregates. The balance includes the value of production realized from the smelting and refining of domestic and imported ores and concentrates; recyclables; steel; aluminum and coal and oil sands mining.

Canada ’s minerals and metals in the world

• Canada is one of the largest mining nations in the world, producing more than 60 minerals and metals.
• Canada is one of the world’s leading exporters of minerals and mineral products. These products accounted for over 17 percent of Canada’s total domestic exports in 2006.
• Mining and mineral processing contributed some $40 billion to Canada’s GDP in 2006.
• Preliminary numbers indicate that nickel was the top metallic mineral produced in Canada in 2006 with shipments valued at $6 billion. Copper production was next at over $4 billion. Canada continued to be the third-largest producer of primary aluminum and diamonds.
• By 2010, it’s expected that Canada will be responsible for 20 percent of the world’s diamond production.

Employment in Canada due to mining and mineral processing

• Total direct employment in 2006 was more than 369,000 jobs. About 49,000 people were employed in mining, 80,000 in smelting and refining, and 239,000 in processing and manufacturing.
• Mineral and metals products accounted for almost 50 percent of the volume handled by Canada’s ports in 2004 and 60 percent of the country’s rail freight traffic in 2005.
• The mining sector provides some of Canada’s best jobs. Weekly earnings average more than $1,000, compared to the Canadian economy average of just under $750.

2006 Performance Statistics

The mining and minerals processing sector experienced a very robust economic performance during the past year. Some highlights include:

• The balance of trade for the mining and mineral processing industries increased 60 percent from some $7 billion in 2005 to over $12 billion in 2006.
• The value of mineral production increased 22.7 percent from $27 billion in 2005 to over $33 billion in 2006. Higher prices were a dominant factor in the increased value of production.
• Investment in mining in 2006 increased 39 percent to $16.1 billion. An increase of nearly 30 percent to $20.6 billion is projected for 2007. Although close to 80 percent of this spending is targeted to non-conventional oil extraction (oil sands), investment in metal mining increased by almost 8 percent in 2006 and gold and silver mining investment was up nearly 60 percent.
• R&D expenditures increased 4 percent in mining and related industries for a total of $538 million.

Most regions of Canada have benefited from the recent strong performance of the mining and minerals processing sector. Examples include:

• Strong 2005 to 2006 growth in spending on exploration and deposit appraisal was experienced in Alberta (+140 percent), Newfoundland and Labrador (+100 percent), Saskatchewan (+75 percent), Yukon (+40 percent) British Columbia (+40 percent), Northwest Territories (+35 percent), New Brunswick (+27 percent) and Quebec (+27 percent).

• Increased 2007 capital investment spending intentions in the mining industry affected Quebec (+83 percent), the three territories (+61 percent), and Ontario (+25 percent).

• Major increases in the total value of mineral production were felt in Nunavut (+674 percent) mainly due to the opening of the Jericho diamond mine. Other increases were experienced in Manitoba (+67 percent) and New Brunswick (+64 percent).

• In 2006, minerals accounted for 99 percent of total exports from the Northwest Territories and some 80 percent of exports from the Yukon.

Mining is an important industry in Canada and it will continue to be a vital part of our economy. The Government of Canada is working with provincial counterparts to increase the benefits that the mining sector brings to Canadians in communities in every province and territory.

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For more information, media may contact:

Alyson Robb Office of the Minister Natural Resources Canada Ottawa 613-996-2007

Jake Jacobs Public Affairs Officer British Columbia Ministry of Energy Mines and Petroleum Resources 250-952-0629 Cell: 250-213-6934

Canadian Intergovernmental Conference Secretariat (CICS)

webmaster@scics.gc.ca