Is Canada losing the exploration game?: The hurdles to increased exploration spending in Canada – by Virginia Heffernan (CIM Magazine – January 03, 2019)

Canada’s status as the hands-down favourite destination for exploration investment is eroding as mineral deposits become more difficult to access, competition for capital broadens, and regulatory uncertainty continues to irk potential investors.

Over the past decade, Canada’s share of global exploration spending for non-ferrous minerals slipped from 20.5 per cent in 2008 to less than 14 per cent in 2017 before inching back to 15 per cent in 2018, according to S&P Global Market Intelligence, which bases its analysis on private sector spending intentions.

Although Canada remains a narrow favourite among individual countries, S&P treats it as a region “for the purpose of continental-scale comparisons.” As such, it has dropped to third place behind Latin America and the “Rest of the World” (mostly Europe and Asia) from second place in 2008.

There is a lot at stake for the country. The mineral exploration and mining industry employs nearly 630,000 in Canada and directly and indirectly contributes more than three per cent to the country’s gross domestic product. Mineral exports account for about 19 per cent of Canada’s total domestic exports, while Toronto’s TSX and TSX-V capture 51 per cent of all global mining financing transactions. The country is a world leader in legal, engineering, geological, equipment and financial expertise.

In order to maintain this exceptional status, Canada must continue to attract explorers willing to risk capital to find the next generation of mineral deposits. Providing better access to the far north, ensuring regulatory certainty, and supporting research and innovation may be the most obvious means to that end, according to industry watchers.

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