The move to low carbon technology and technological developments is spurring global demand for critical minerals – leading to predictions of long-term shortages of minerals that are essential components for clean energy and other green technologies.
To address these anticipated shortages, help mitigate climate change, grow the provincial economy and ensure resilient supply chains, British Columbia is developing a Critical Mineral Strategy (the CMS).
In early 2024, details were published regarding the first phase of the CMS (Phase 1), which is expected to enhance the contribution of mineral exploration and mining to B.C.’s economy through critical-mineral development. Phase 1 sets out clear actions to build a clean economy by expanding the province’s critical minerals sector in alignment with the standards of the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP).
What are critical minerals?
Critical minerals, such as copper, nickel and molybdenum, are essential components in products used for clean energy, digital technology, telecommunications, health care and other applications. The federal government identified 31 critical minerals in the Canadian Critical Minerals Strategy. B.C. has significant deposits of 16 of these 31 critical minerals, is Canada’s largest copper producer and the nation’s only molybdenum producer.
The provincial mining sector
B.C. is a leading mining jurisdiction, both in Canada and globally. The province’s mines have some of the lowest carbon footprints in the world – strategically positioning these mines to provide the minerals necessary to support low carbon economies. The provincial government hopes to build on this foundation by expanding the B.C. critical minerals sector, seizing the opportunity to service the world’s need for a stable, free, democratic and high-standard producer of minerals essential to addressing climate change.
Goals of the CMS
The CMS has three overarching goals: (1) to expand First Nations partnerships, shared decision-making and reconciliation; (2) to increase business certainty to attract investment; and (3) to establish funding partnerships to advance critical mineral projects.
Key actions under Phase 1 of B.C.’s Critical Mineral Strategy
Phase 1 of the CMS launches 11 key strategy actions, intended as first steps to support the development and growth of the critical minerals sector, attract investment and ensure a stable workforce in a competitive jurisdiction while also addressing barriers to critical mineral development and the conditions to enable development. These actions are briefly summarized below.
- Critical Minerals Project Advancement Office: The establishment of this office is intended to centralize and expedite the advancement of priority critical minerals projects and lead the assessment of B.C.’s fiscal environment to ensure that the province leverages related federal funding opportunities.
- Investments in geoscience: B.C. will invest in geoscience to ensure that the mineral exploration sector and First Nations have current, accessible and ongoing access to world-class geoscience, including the development of a first-ever B.C. Critical Minerals Atlas to provide a comprehensive overview of the types and quantities of minerals found in the province.
- Promotion of the province’s ESG advantage: Already a global leader in environmental, social and corporate governance (ESG) standards, B.C. is committed to achieving a globally recognized standard of ESG. To this end, the province has established the ESG Centre of Excellence, designed to support businesses and entrepreneurs to promote, develop and market environmentally friendly and socially responsible goods, resources and services.
- Priority critical-mineral infrastructure: The province will partner with the federal government and First Nations to advance and identify funding for high-priority strategic regional infrastructure projects, with a view to enabling critical-minerals growth in northwest B.C.
- Invest in strategic regional critical minerals projects: The province will advance opportunities to leverage federal funding to enable critical-minerals processing, manufacturing and circular-economy projects, including a $1.05 billion partnership between E-One Moli Energy Corp. and the provincial and federal governments to bring lithium-ion battery cell production to Maple Ridge (this was announced in 2023).
- Infrastructure and electrification gap assessment: B.C. will conduct a detailed province-wide assessment to identify and make plans to address infrastructure gaps that are barriers to critical-mineral development. First Nations partners and industry are anticipated to participate in this assessment.
- Commitment to First Nations on continued critical-minerals development: The CMS will have an evergreen approach, with further development and implementation based on ongoing analysis and engagement with First Nations and First Nations organizations. This includes a plan to work with the B.C. First Nations Energy and Mining Council (FNEMC) to identify synergies between Phase 1 strategy actions and the FNEMC’s First Nations Critical Mineral Strategy (FNCMS).
- Continued commitment to reform the B.C. Mineral Tenure Act: Collaboration between the province and First Nations and engagement with industry stakeholders is underway to modernize the BC Mineral Tenure Act in alignment with UNDRIP, with the goal of implementing a new act in spring 2025.
- Fiscal environment assessment: B.C. will assess the need for targeted incentive programs that drive investment through the critical mineral lifecycle, incentivized production and maintain competitiveness, while also identifying barriers to attracting investment and recommending next steps to mitigate such barriers.
- StrongerBC skills training and workforce development: The Ministries of Energy, Mines and Low Carbon Innovation, and Post-Secondary Education and Future Skills will partner to optimize programs to meet workers and critical-mineral sector skills and training needs. This will include assessing existing programming and identifying and addressing training and workforce gaps.
- Alignment of B.C. and FNEMC Critical Mineral Strategies: The province will continue to engage with First Nations and align the CMS with the FNCMS.
Key takeaways
Last year, mineral exploration expenditures in B.C. increased 94.1% compared to 2018, with 2023 mining production value forecasted to be 69.3% higher than in 2018. The B.C. mineral industry is already world-leading and growing, and critical minerals have been identified as the next step to keep this momentum going. Both the federal and provincial governments are showing full support for the critical minerals sector – in words and action. Through Phase 1, and the second phase to follow, the critical mineral industry in B.C. is poised to improve its already-strong position as one of the leading investment opportunities in a de-carbonizing world.
Proactive government investment in infrastructure, policy, training and in projects directly displays a belief in the opportunities to be found in the critical mineral market. This could bring meaningful economic growth to B.C. while offering the world a safe and stable source for much-needed critical minerals. As collaboration with First Nations and other stakeholders continues to shape development, transformative change in the critical mineral industry is likely on the near-term horizon.
If you are interested in learning more about the Critical Minerals Strategy or any other securities matters, please contact MLT Aikins Corporate Finance & Securities practice group.
Note: This article is of a general nature only and is not exhaustive of all possible regulatory requirements, legal rights, or remedies. Laws and regulatory requirements may change over time and should be interpreted only in the context of particular circumstances. These materials are not intended to be relied upon or taken as legal advice or opinion. Readers should consult a legal professional for specific advice in any particular situation.