BC Energy, Mines and Petroleum Resources Minister Michelle Mungall marked Mining Month last week by acknowledging that the industry provides 30,000 direct jobs in B.C. and will play a critical role in the global decarbonization effort.
Indeed, because of the role it plays in providing the metals and minerals needed for renewable energy and electric cars, mining’s hitherto environmentally destructive image has taken on a greenish tinge.
But Mining Month just happened to coincide this year with the wind-down of the Mount Polley copper mine, which is being put into care and maintenance indefinitely.
If the BC NDP government is serious about supporting B.C.’s mining industry, it needs to do something about carbon taxes and leakage, says a chorus of B.C. copper miners.
They are feeling the pinch of B.C.’s relatively high carbon taxes, which becomes particularly painful when gasoline and diesel prices soar, as they have lately.
“Energy’s a big part of running a mine, between fuel and power – and they’re both going up,” said Brian Kynoch, CEO of Imperial Metals (TSX:III).
“The carbon tax presently costs Copper Mountain $3.5 million per year without reducing carbon emissions,” said Gil Clausen, CEO of Copper Mountain Mining Corp. (TSX:CMMC).
The carbon tax that Taseko Mines Ltd. (TSX:TKO) has paid annually on its Gibraltar copper mine has risen to $4 million from about $3 million since 2008, said Taseko CEO Russell Hallbauer.
“That’s $30 million that has been spent on carbon tax,” he said. “But now it’s not revenue neutral.” The NDP government has touted B.C.’s mining industry as a key element of its CleanBC climate plan. It acknowledges the mining of metals like copper as essential to the low-carbon energy transition because of their use in renewable energy, transmission and electric vehicles
Copper mining executives who spoke to Business in Vancouver generally agreed they are not averse to carbon taxes per se. But promises of a revenue-neutral carbon tax have been broken, and mechanisms that were promised to protect energy-intensive trade-exposed industries have not materialized. Nor do they appear to be even on the horizon.
And the one advantage that B.C. miners once enjoyed over other copper mining jurisdictions such as Chile – cheap, clean power – is quickly vanishing. Power prices in B.C. have steadily increased over the past decade and promise to go up another 8% over the next five years.
“We are competing against the Chileans, the Africans, everybody else producing copper,” Hallbauer said. “They’re not paying carbon tax like we are.
“There are a lot of companies that are not supportive of the carbon tax for these exact reasons. And it’s not just big companies. The bulk of Canadian employment comes from medium- and small-sized business, and we’re getting hammered on carbon tax.”
Their complaints are legitimate, said Chris Bataille, an adjunct professor in Simon Fraser University’s School of Resource and Environmental Management.
“B.C. energy-intensive and trade-exposed sectors (EITEs) are legitimately facing differential GHG [greenhouse gas] prices of up to $35 [per tonne] against their competitors,” he wrote in an email to Business in Vancouver. The one advantage that B.C. …read more