The North needs more infrastructure to unlock its wealth potential

Few industries come to mind that have a stronger connection and reliance on infrastructure than the mining sector. Frequently situated in remote and northern regions, mines are often located in areas without any roads, telecommunications services, or easily accessible transportation, all essential to getting goods to market. Nowhere is Canada’s infrastructure deficit more acute than in the North. Having just been in Iqaluit as a speaker at the Nunavut Mining Symposium, I heard repeatedly from attendees and speakers on how the key to unlocking the North’s potential lies in infrastructure investment. We know that the future of Canada’s mining industry lies increasingly in remote and northern regions, but the infrastructure deficit challenges project economics in this part of the country. The Mining Association of Canada and mineral industry partners undertook extensive research on how remote and northern mining costs compare to those in the South. Our research indicates it costs two to 2.5 times more to build the same precious or base metal mine in the North (off-grid) than in a centrally located region and, most importantly, that 70 per cent of this cost differential stems from the infrastructure deficit. The report also found that Arctic mining operational expenditures are up to 60 per cent higher than their southern counterparts, largely due to the extensive supply chains essential to bring in critical supplies to the mine site and then bring product to markets. The North’s current infrastructure deficit acts as a major barrier to opportunities for greater wealth discovery and production. Exacerbating this is the historic under-eligibility of the territories to access federal infrastructure programs due to “public use” program criteria and per-capita funding formulas. Characterized by spread-out communities, extreme temperatures, and virtually no infrastructure or people for hundreds of kilometres, remote and northern regions have some of the highest per-capita living costs in the country. The mining industry has advocated for, and is encouraged by, recent federal infrastructure investments that recognize northern challenges and opportunities, including the Trade and Transportation Corridors Initiative (TTCI), which dedicated $400-million for trade-enabling infrastructure in the territories, and the Investing in Canada plan, which allocated funding on a per-capita “plus” model, both announced in 2017. However, the need is great. Without strategic and wealth-generating infrastructure development to further enhance investment competitiveness, these regions will remain disproportionately reliant on transfer funding for core services and program delivery. As the largest private sector driver in Canada’s Arctic, responsible for approximately one in every six jobs, mining plays an essential role in the region. Ensuring appropriate infrastructure is in place to encourage growth is an integral component of its future success. The infrastructure deficit is the largest barrier to creating new economic and social development opportunities, and the Canada Infrastructure Bank is particularly well situated to partner in addressing it through meaningful consideration of power, telecommunications, and transportation infrastructure projects that are in the national interest. The infrastructure bank has a significant role to play in transforming remote and northern Canada—regions that are critically important to, and reliant on, Canada’s mining sector. Since its inception, the Mining Association of Canada has underscored the need for remote and northern recognition in the infrastructure bank through a dedicated allocation and project stream. Announcements made in the 2019 budget have demonstrated a continued commitment to Canada’s Arctic. Specifically, the renewal of the northern allocation under the TTCI and the commitment to bring high-speed internet to Arctic communities and businesses are welcome. These measures, coupled with positive news in the fall economic statement, the promise of the Arctic policy framework, and the new Canadian minerals and metals plan, can be platforms for transformative change. The key is building on our strengths and prioritizing the North. Brendan Marshall is the vice-president for economic and northern affairs for the Mining Association of Canada. The Hill Times