A new report Investment interests and government tax incentives are fueling intense mineral exploration in remote areas of northern British Columbia, raising concerns, according to the U.S. branch of the nonprofit Environmental Investigation Agency. regarding the environmental impacts of the work and their financial implications.
The report focuses on the transborder region, which lies along the border between the Alaska Panhandle and the province of British Columbia. Much of this exploration is focused on what is called Golden Trianglewhich in many regions is still covered by glaciers.
Scientists say melting glaciers could offer new habitat for salmon. But the region is also rich in gold deposits.
According to the report, more than 450 Canadian companies are currently focused on claim staking and mineral exploration in the region and are linked by a risk-sharing strategy called the prospect generation model.
The financial model involves staking large tracts of land and raising funds for multiple claims at once, sometimes in partnership with multiple companies.
Incentives needed due to risk
A single company, Brixton Metals, has a mining claim area twice the size of Los Angeles.
The hope is that at least one concession will become a profitable mine and cover costs for all, and that in the meantime key investors and company executives can be paid from the capital raised. In the meantime, the report says, “average investors, Canadian taxpayers, Indigenous peoples, rural residents, and downstream U.S. communities and economies must bear the financial and environmental risks.”
Steve Suarez, a corporate tax lawyer and founder of the online web resource Mining Tax Canada, said it’s true that only one in 10,000 exploration projects becomes a lucrative business, but that’s why protections for investors and tax incentives are in place.
“These exploration companies are spending real money to get real people out there and into the bush,” he said. “I don’t disagree for one second that it’s a risky business. But that’s kind of the whole problem.”
Suarez said that without these incentives, it would not make financial sense to conduct exploratory work.
Kylie Williams, who serves as communications director for the British Columbia chapter of the Association for Mineral Exploration (AME), said exploration is a critical first step toward obtaining the critical minerals needed to the green transition.
“If we want to electrify our economy globally, we need these companies that have the mentality of trying to find metals and trying to find projects that are going to be successful,” she said.
But some advocates say these efforts could be lucrative enough in themselves to allow continued exploration without significant accountability for a mine’s profitability.
“It’s all about telling a story,” said Nikki Skuce, director of Northern Confluence and co-chair of the BC Mining Law Reform Network.
“I mean, you’re trying to get people excited about giving you funding. There’s something about people (getting) pretty comfortable salaries from just telling stories rather than actually working in mining.”
Although not as intensive as a mining operation, the report also says exploration can have a serious environmental impact.
Over a five-month period, they discovered that Teuton Resources, Tudor Gold and American Creek Resources had burned more than $1 million in fuel for helicopter flights and other uses for exploring the claims they are co-owners.
“The approximately 868,000 liters of fuel burned are equivalent to more than 2,000 tonnes of CO2 emissions, or approximately the amount generated by 450 cars driven for a year,” the report said.
80 percent of disasters within 5 kilometers of a river
EIA researchers also found that more than 80 percent of the region’s mining claims are within three miles of a river or stream. CBC spoke to several local First Nations and Alaskans who expressed concern about the impacts of industrial activity near the watershed on fish and people.
Heather Hardcastle works for the nonprofit Alaska Salmon State, the organization that first commissioned the report from the EIA.
“There are a number of experiments that we now have to show that wild salmon and mining really don’t mix,” she said. “A tiny amount of copper in an Olympic swimming pool can impact wild salmon navigation.”
Richard (Chalyee Eesh) Peterson is Chairman of the Central Council of the Tlingit and Haida Indian Tribes of Alaska. He said the British Columbia government told him the mines operating today would be different from those in the past, but it’s hard for him to believe that.
“We never stop talking about Tulsequah Main Mine because it’s a mine that’s contaminating the river and hasn’t been maintained for, you know, decades and decades now,” he said. “Let’s talk about this cleanup before we talk about the deliverance new permits and give the green light to new projects.”
Tulsequah Chief operated from 1951 to 1957, producing gold, silver, zinc, copper and other minerals. In 2019, the province committed to cleaning up the abandoned mining site, located about 80 kilometers south of Atlin, British Columbia, near the Alaska border.
But to this day, runoff from the mine continues to seep into the Taku River, which flows into Juneau.
British Columbia Mines Minister Josie Osborne said in a statement to CBC that British Columbia does not encourage exploration in fragile areas.
“All proposed exploration is subject to a rigorous permitting process, and developers must demonstrate that the work they propose protects the environment,” she said.
Osborne said his government is committed to a competitive mining and mineral exploration sector that boosts the economy, supports environmental management and advances reconciliation.
Several companies also provided CBC with a joint statement in response to the report calling environmental monitoring in British Columbia “rigorous.”
“Projects are subject to federal and provincial assessments in addition to Indigenous consultation,” we can read.
“Closing mining in the cross-border region… would have a devastating effect on local communities, not to mention provincial and federal tax bases.”
Without local explorers, Canada would jeopardize its access to essential minerals, he says, a perspective shared by the AME.
Peterson said he hopes the report released Jan. 22 will lead to changes and more conversations around co-management.
“The more I learn, the more dismayed I am. It’s not just about the salmon,” he said. “Our people have lived in this region for tens of thousands of years. We have watched the Tongass forests grow… our stewardship of these lands and resources has always been a matter of balance. If you destroy a species, it throws us all off balance.”