NEWS RELEASE: What has mining done for Ontario lately?

This article was provided by the Ontario Mining Association (OMA), an organization that was established in 1920 to represent the mining industry of the province.

To people inside the mining industry, this headline will perhaps be viewed as a rhetorical question. Those involved in the mineral sector know about the large capital investments, the thousands of direct jobs, the proliferation of indirect jobs providing supplies and services to mines, the provincial infrastructure constructed by and supported by mining, the communities it builds and the taxes companies and well paid employees pay to support all Ontarians – and Canadians.

However, to those less familiar with mining, this will seem like a fair question that deserves an answer. Let’s try this approach. The Ministry of Northern Development and Mines confirms that within the past 10 years, there have been 24 mines open in Ontario. There is a broad geographic dispersion of the location of these mines but many are in the Sudbury, Timmins, Wawa and Kirkland Lake areas – all traditional mining communities in this province.

While a small number of these two dozen mines can’t show continuous production, the vast majority are busy with development plans and projects to ensure their futures. Space does not allow a detailed look at all of these operations but let’s single out a few as examples.

Ontario’s first – and for the time being – only diamond mine must be mentioned. De Beers Canada officially opened the Victor Mine, located about 90 kilometres, west of Attawapiskat in June 2008. The capital investment required to bring this mine to production was $1 billion.

During its construction and early production phases, the mine´s workforce surpassed four million hours worked without a loss time injury. The mine is expected to have a positive impact on Ontario´s Gross Domestic Product (GDP) of $6.7 billion and a $4.2 billion GDP contribution to the economy of Northern Ontario.

De Beers Canada employs approximately 1,023 people of which about 440 work at the Victor Mine. About 40% of the Victor workforce is Aboriginal. In 2011, the company paid total wages and benefits of more than $142 million and about $55.5 million of that total was paid to Victor employees.

At the Victor site, in 2011, $101 million was spent on goods and services with about $57 million, or 57%, being provided by Aboriginal businesses. At the corporate level, expenditures with Aboriginal businesses totaled $97 million and the company provided $5.3 million to communities sharing impact benefit agreements. An additional, $4.9 million was provided in 2011 in donations as social investments promoting health, education, sports and culture in its host communities.

In August of last year, AuRico Gold officially opened the Young-Davidson Mine in Matachewan, located about 60 kilometres west of Kirkland Lake. It took a capital investment of $400 million to bring this precious metals site into production. During its two-year construction period, the mine employed up to 1,200 people at its peak and at full production, the mine employs about 300 people. During the construction and development of the mine site’s facilities, more than two million hours were worked at the site without a lost-time incident.

Detour Gold at its new mine, which is located about 180 kilometres northeast of Cochrane, poured its first gold bar in February of 2013. This new gold mine was built with a capital cost of about $1.5 billion. The mine provides full-time employment for about 500 people directly. During the construction phase of the mine, which began in November 2010, it was not unusual to have more than 1,000 people on the site representing 15 or more contractors. During this stage of mine development, Detour Gold was not only building a mine but it was the largest hotel and food service operation in Ontario.

Lake Shore Gold in the Timmins area entered the ranks of gold producers in 2011. In 2012, the company spent $138.5 million on supplies and services in Timmins and a further $90 million was spent outside the Timmins area. It is this type of spending that supports Timmins mine supply and service sector, which is estimated to have a value of more than $590 million annually and employ about 4,600 people. Lake Shore Gold has more than 500 full time employees of its own and for mine development, mill expansion and other infrastructure work, there are about 300 contractors working at company sites.

Mines come in all shapes, sizes and commodities. Wesdome opened its Mishi Pit in May 2012 to supplement gold production at its operations in the Wawa area. The opening of the Mishi Pit itself directly created 40 new jobs itself adding to the 240 employees at the Eagle River Mine. Incorporating Mishi ore into the Eagle River mill then created a second shift at the processing plant and led to the hiring of additional employees.

The opening of Mishi Pit has also created its own internal spin-off job creation. Wesdome maintains an office, a warehouse and an assay laboratory in Wawa. The opening of the Mishi Pit increased the company’s need to monitor grade control and dilution. The assay laboratory now has a second shift and the number of employees has increased from 15 to 30.

The five new mines mentioned above are representative of the positive impact and contributions made by the other 19 mines, which started operations in Ontario in the past decade. They all bring major capital investments, employment in a multitude of forms both directly and indirectly, community building activities, infrastructure development and hundreds of millions of dollars in taxes for all levels of government, while producing commodities of value essential to modern society.

However, perhaps the greatest commodity new mines bring to Ontario is hope. Hope for opportunities, hope for training, hope for meaningful employment, hope to build better health and education facilities and hope for a brighter future. A University of Toronto study (“Ontario Mining: A partner in prosperity building”) shows the economic employment multiplying impact of mining. It indicates that for every direct job in a producing mine in Ontario 3.75 indirect and supply and service jobs are created.