Mining Association of Canada | 2023 Report

The Mining Association of Canada | The Canadian Mining Story: Economic Impacts and Drivers for the Global Energy Transition 2023 33 Canada’s inventory of major projects in natural resources over the next decade shows 124 mining projects with a combined value of $88.3 billion. This is an increase of five projects over the 2021 inventory, but a decrease in total project value of $500 million. These 124 projects include mine construction, redevelopment, expansion and processing facilities. The majority of the projects are related to metal mines, with coal mines and non-metal mines making up most of the balance. LOOKING FORWARD Federal, provincial and allied international governments have recognized Canada has the raw materials and value-added mineral and metal manufacturing expertise to help meet their growing demand while diversifying supply sources. In short, countries diversify their supply chains with improved security and sustainability when they source materials from Canada. But there remains work to do to ensure Canada’s competitiveness isn’t diminished. Over the last 15 years, several Canadian senior mining companies have been acquired by multinationals, resulting in fewer head offices in Canada. Canada’s share of global production for critical minerals and metals has been decreasing, with other jurisdictions capturing greater market share of growing global demand. Capital investment continues to be substantially below its level a decade ago. Rising prices may help to spur investment in exploration and development, but there is strong global competition for investment dollars, and Canada’s economy is dependent on foreign direct investment. As a result, MAC makes the following recommendations to strengthen access to capital for Canadian miners: • Financing for early-stage exploration. In the 2022 budget, the Canadian government doubled the Mineral Exploration Tax Credit (METC) for targeted critical minerals, including nickel, copper, cobalt, rare earths and uranium. The METC is a nonrefundable tax credit on exploration expenses that is designed to encourage investment in exploration companies. Expanding the METC and increasing the rate for northern exploration would increase its attractiveness to investors. • Continuing the Accelerated Investment Incentive, which will enable miners to write off three times the eligible cost of newly acquired assets in the year the investment is made. • Allowing businesses to immediately write-off the full cost of clean energy equipment, including the immediate write-off of heavy electric equipment, including haul trucks, in the mining space. The stakes are high. If Canada loses its investment competitiveness, this will translate into an increasing amount of exploration and mining investments flowing offshore, job losses, deteriorating trade balances and a weakening of our overall economic strength, including on key policy objectives such as establishing a battery and EV supply chain.