To keep up with the US and their allies’ efforts to speed up the production of critical minerals in North America, Canadian Prime Minister Justin Trudeau’s administration plans to introduce a streamlined permitting strategy for mining projects by years’ end.
Canada’s significant reserves of vital minerals puts the country in high demand, especially as the US seeks the minerals essential to producing electric cars, solar panels, and wind turbines. As a result, American lawmakers are currently considering strategies to speed up the authorization processes for resource initiatives.
Despite possessing significant reserves of crucial minerals, it takes about five to 25 years to transform them into a mine. This timeline serves as a considerable obstacle to Canada’s objective to position itself as a leading player in eradicating China’s dominance in the critical mineral market.
According to Heather Exner-Pirot, a special adviser with the Business Council of Canada, the ongoing negotiations in the US to introduce resource project permitting reforms increase the urgency for Canada to accelerate mine construction timelines. As commodity prices surge and critical metals supply shortages arise, the US is pushing for permitting reforms to expedite resource projects’ approval.
The consistent underfunding of the agencies responsible for authorizing licences, combined with inadequate coordination between the provincial and federal governments, has resulted in permitting backlogs.
The Impact Assessment Act, implemented in 2019, aimed to reduce permit timelines to a maximum of five and a half years by implementing time limitations on assessments and approvals. Nevertheless, in practice, many projects continue to experience extended delays.
The lengthy process of approving mining projects creates uncertainty for investors and often results in insufficient funding for mine builders, leading to potential project delays. Heather Exner-Pirot states that the permitting system is very political, creating risks and uncertainty for investors. The lack of guaranteed approval and potential for political interference to halt mine development years later adds to the uncertainty that investors face.
Additionally, mining projects adhere to strict environmental assessments mandated by the federal and provincial governments, which often encounter opposition from local Indigenous communities that are vulnerable to potential hazards. Natural Resources Minister Jonathan Wilkinson has acknowledged the need for swift permitting but has pledged to uphold environmental standards and ensure consultation with Indigenous groups.
One prominent example in Canada that demonstrates the protracted process is Ontario’s “Ring of Fire“, an area containing a high concentration of metals that plays a significant role in Canada’s critical minerals plans. Due to permitting obstacles and opposition from Indigenous communities, proposed projects in the area have remained idle for nearly two decades.
The Canadian government’s recent high-level departures have also complicated efforts to effect changes in the permitting system. The review of the permitting system was initially led by Janice Charette, the top federal civil servant, and Michael Sabia, the top Finance Department official, both of whom left the government in the past two months. John Hannaford, Charette’s replacement, is currently overseeing the review alongside Paul Halucha, a top official in the Environment department. Furthermore, Mollie Johnson, a senior official in the Natural Resources department responsible for the review is leaving to assume the role as deputy secretary to the cabinet later this month.
