Amidst a drought in junior financing – which drives much discovery in Canada – Minex Consulting’s Richard Schodde casts a pall over metal reserve replacement in Canada.
HALIFAX, NS (MINEWEB) – In a wide ranging overview on the state of exploration in Canada, Richard Schodde of Minex Consulting draws a stark picture of the state of Canada’s declining reserves and the prospect they can be replaced given lengthening timelines for mine permitting.
“Canada needs to replace the metal it mines,” Schodde concludes in a presentation he published covering points he made at the recent Quebec Mineral Exploration Association conference in Quebec Cty.
He continues, “Over the last two decades, reserves and mine lives for most metals have shrunk – and the issue is now becoming urgent. Of concern is whether there is enough time left to discover and develop new mines before the existing ones close.”
Schodde’s blunt assessment draws on statistics showing that, by and large, base and precious metals reserves in Canada have plummeted in recent decades, while the time it takes to permit mines after a deposit is discovered has marched inexorably upwards in the past 100 years.
Now the average delay between discovery and production is 11.2 years, Schodde calculates.
Already metal output in Canada is largely on the decline, along with mine life. “Of real concern is, do we have enough time to find the next generation of mines?” Schodde writes.
Overall Schodde estimates the average mine life for nickel, copper, gold, zinc and lead mines are 20.4, 19.2, 8.6, 6.3 and again 6.3 years, respectively.
In light of shortening mine lives, the worry is that since it takes so long to get a mine to production due to permitting, there will not be enough time to replace or increase metal output and the precipitous decline could continue unimpeded.
That fate is made all the more possible by the ongoing drought in financings that juniors – which are the driving force behind many of Canada’s discoveries – continue to face.
Schodde notes that on average there are between five to ten discoveries in Canada a year and 82 percent of these were made by juniors in the past five years. Looking back into the junior track record since 1960, Schodde estimates juniors delivered 45 percent of Canada’s discoveries, including 29 percent of tier 1 and 2 discoveries.
Thus it’s fair to be concerned that with declining spending on junior exploration over the past couple years, discovery will decline and the erosion of Canada’s mineral reserves and mine life will worsen.
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