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You can see the effects of the mining boom in Canada’s North on the streets of its communities: There’s commotion; there’s optimism; and there’s money.
Boris Kotelewetz says he’s witnessed first-hand the changes growth in the mining sector across the three territories have brought to his community of Baker Lake, Nunavut. While he admits there’s a wave of economic prosperity sweeping through the region, he also warns of the dangers of short-sightedness, both in the industry and in the towns it leaves behind.
“I’ve seen all kinds of changes,” said Kotelewetz, who has lived in Baker Lake for 46 years.
“To me, it’s like when the whalers came and they needed fresh meat; they employed local people to take part in that. Then that industry died out. Then the Hudson’s Bay Co., came and they employed people in trapping and that industry kind of died out.
“Now we have mining coming along. Because it’s a non-renewable resource, it’s not everlasting. It’s just going to die out – certainly the gold mine will – and that will just be the end to another thing that started and stopped.”
Kotelewetz operates a lodge and other businesses in Baker Lake, a community of 1,800 located about 70 kilometres south of Meadowbank, a gold deposit being mined by Agnico-Eagle Mines Ltd., a Canadian-based gold producer with operations in Canada, Finland and Mexico.
The mine has significantly increased employment in Baker Lake, and with that comes a boost in morale associated with an influx of jobs and an increase in disposable income.
Kotelewetz, however, says he worries that a lack of preparation for the future may create problems down the road.
“It’s a party right now,” he said. “We’re having a party here, but we have to think about when that party ends. What happens then?”
The situation in Baker Lake is hardly unique.
This past week, the Conference Board of Canada said Canada’s North is poised to lead the country in economic growth over the next two years as the boom in mining projects takes hold.
The economies of the three territories are expected to grow by more than seven per cent in both 2012 and 2013. That easily surpasses the Canadian average of 2.1 per cent this year.
The conference board’s Territorial Outlook-Winter 2012 said the Yukon and Nunavut are entering a period of sustained mining development, citing several large projects that have been proposed for the current decade.
The mining boom in the Yukon is expected to continue over the next 10 years, creating a heavy demand for workers.
Nunavut’s economy grew by 6.8 per cent in 2011 and the territorial economy is forecast to grow by 16 per cent in 2012.
Employment is expected to surge by 6.4 per cent annually over the next three years.
Some of the marquee projects underway or in the works throughout the region include diamond, gold and copper deposits scattered across the three territories.
The N.W.T. and Nunavut Chamber of Mines said the effects of mining in the North provide countless benefits to the communities and its residents.
“In Nunavut, for example, there’s a baby boom happening and without opportunities, you’ve got a lot of communities with huge unemployment and significant social issues, so when you have an industry like mining come in to offer the opportunities, you can really help the communities,” said executive director Tom Hoefer.
Hoefer said the spinoff activity that results from mine-related prosperity is clearly evident over the last decade and a half, coinciding with when the diamond mining industry began to make inroads.
Diamonds were first discovered in the Northwest Territories in 1991, with the first mine starting production in 1998.
“If you turn the clock back 15 years, before that first diamond mine, there was probably a handful of aboriginal companies involved in industry somehow,” Hoefer said. “Today, there’s at least 60, and they’re creating major corporations that can go out and work in other jurisdictions. It’s really been a big boost for the North.”
He said the potential – based on pending mines that are currently going through the assessment phase or other pre-production stages – is there for many years of future prosperity in the region, noting that current projections see production lasting well into the 2030s.
Gordon MacKay, Nunavut’s assistant deputy minister of economic development, said his territory is working to build a long-term and sustainable mining industry, and with multiple projects in all stages of development, it’s hard not to get excited.
“We are optimistic about the future, but we certainly aren’t taking it for granted,” MacKay said.
“We know this mineral development is dependent on global forces that we cannot influence, so we’re cautiously optimistic.
“We’ve worked hard to make the territory an attractive place for investment and we’re determined to ensure we maintain that state . . . Our target is to get a sustainable mineral exploration mining industry that doesn’t suffer the boom or bust scenario. We want a stable, long-term industry.”
He acknowledged that social issues may surface due to economic prosperity, but noted the Northern mining industry isn’t alone in that.
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