Ottawa (November 21, 2018) — The Prospectors & Developers Association of Canada (PDAC) applauds the Government of Canada for taking steps to enhance the competitiveness of Canada’s mineral sector, as announced in today’s Fall Economic Statement (FES).
To support mineral exploration in Canada, government will renew the Mineral Exploration Tax Credit (METC) for five years until 2024. This is the first multi-year renewal of the METC since its inception in 2000, something PDAC has long championed and advocated for.
“Today’s commitment by the government is a monumental sign of support for the growth of, and investment in, Canada’s mineral exploration sector,” says Glenn Mullan, PDAC President. “The METC is a critical component of our industry that helps to catalyze investment in mineral exploration projects that lead to the discoveries that could become the mines of the future.”
Canada’s mineral sector faces strong global competition for investment, and obtaining financing for exploration activities, largely undertaken by junior companies, has become increasingly challenging. The flow-through share regime, enhanced by the METC, has played an essential role in attracting investment for small to medium sized, non-revenue generating exploration companies operating in Canada. It is an effective incentive that has stimulated investment in mineral exploration over the past 18 years.
“We are pleased that the government has heard our concerns about Canada’s waning competitiveness and adopted our recommendation,” says Lisa McDonald, PDAC Executive Director (Interim) & COO. “Renewal of the METC for five years will help to provide greater certainty and boost confidence for investors, and signals government’s appreciation of the importance of our junior exploration sector.”
Today’s METC announcement will provide stability for exploration companies, increasing the opportunity for multi-year exploration program flow-through funding and allowing for longer-term planning. This is vital for exploration programs as mineral deposits are carried out in stages over an extended period of time. Exploration companies and investors depend on some level of certainty to finance not only the current year of their exploration programs, but also any subsequent exploration necessary to fully scope the mineral potential of a particular property.
Canada’s mineral exploration and mining industry generates significant economic and social benefits in remote communities, Indigenous communities, and cities across Canada—employing 634,000 workers and contributing $96.5 billion annually to Canada’s GDP (both directly and indirectly). Government’s support for the sector is critical in driving new discoveries that will lead to new mines, and helping to advance Canada’s mineral industry competitiveness well into the future.
The Prospectors & Developers Association of Canada (PDAC) is the leading voice of the mineral exploration and development community. With 8,000 members around the world, PDAC’s mission is to promote a globally-responsible, vibrant and sustainable mineral sector that encourages best practices in technical, operational, environmental, safety and social performance. PDAC is known worldwide for the annual PDAC Convention—the premier international event for the industry—that has attracted over 25,000 people from 135 countries in recent years and will next be held March 3-6, 2019 in Toronto. Please visit www.pdac.ca.
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