Fees Levied on BC Mining Industry

LEH-130111_1326+(1) BC Mining. Globe and Mail/http://www.theglobeandmail.com

Fees Levied on BC Mining Industry

By Nicole Halseth, News Editor

New fees are set to be imposed on the mining industry by the BC government.

Mines Minister Bill Bennett explained the decision to the BC legislature on 27 February, claiming that responsibility to bear costs for better services should fall to the mining industry. He explained that this move “will give the ministry an opportunity to bring a few more resources in to improve our performance.”

The mining industry is slightly less than enthused about these new fees, however. According to the Globe and Mail, the sector has responded by saying the move is “punitive” and “warns it will undermine already-fragile small-scale mining companies.”

This move seems somewhat incongruous with Bennett’s previous actions towards the mining sector. From his influence, the BC government “restored ministry resources for services such as permit approvals” only two years ago. At the time, Bennett explained that government cuts had stifled economic growth in the province by impeding resource sectors like mining, forestry, and oil and gas. The government is now demanding the mining industry pay for those services that were restored two years ago.

The BC government defended its decision in a discussion paper released last month, claiming the fees are needed to provide further permit services. In the paper, the government also claimed that the restorations of 2011 were a temporary measure, and current economic conditions necessitate a more long-term solution, which these fees are hoped to provide.

In response, opposition NDP critics claimed the move is “ill-timed.” According to mining critic Scott Fraser, “This new tax will be felt more profoundly by the smaller exploration companies, placer miners and prospectors – the backbone of the industry.” Fraser also commented further by saying “How much are mining companies going to be hammered by this new stealth tax?”

If fee levels remain at currently proposed levels, ministry officials claim it could bring in almost $5.5-million a year for the province.

These fees are set to begin implementation in the fall of this year. They could range from only a few thousand dollars for the processing of a work application, to around $300,000 for large mine permits or expansions. President of the Chamber of Mines for eastern BC, Jack Denny, also had something to say on the matter. He claims these fees may actually make job creation more difficult for smaller projects, as they are already struggling with expenses and a lack of capital, and many of those who would be paying these new fees struggled substantially in 2013.

In a statement, Denny said “I find it difficult to believe that there are many outside of the government who think the proposed fees are anything but a cash grab.” He elaborated by saying “While there are some big development projects ongoing, the exploration boom is over. If the ministry permitting staff cannot keep up now … the solution should be to simplify the process rather than punitive application of fees.”

This move follows the recent and inflammatory decision to reject the New Prosperity copper-gold mine proposal. Bennett commented that “he is no longer sure he can meet his job creation targets for mining because of Ottawa’s decision.”

It seems the mining industry in BC is heating up. In a resource-based economy like ours, these decisions will impact northern communities and individuals heavily.