Mining could see billion-dollar boost

Winnipeg Free Press with Shastri Ramnath 18 November 2019


There has not been much good news in the mining industry in Manitoba for a few years, but that’s starting to change, potentially in a very big way.

Vale is on the verge of making what would be the largest single investment in the mining industry in Manitoba’s history at its Thompson operations.

This week’s provincial mining exploration conference led off with the blockbuster news that the Brazilian company is in the final stages of confirming $1 billion of new investment in its Thompson operations over the next five years.

That news was followed by a presentation from Rockcliff Metals Corp. outlining its intention to spend $20 million on exploration in the province over the next couple of years and a HudBay Minerals official saying the company is fast-tracking its latest potential mine site near Snow Lake.

At the Central Canada Mineral Exploration Convention — the second annual conference organized by the private sector after the province reorganized the mines department and stopped funding an annual industry showcase — the positive messaging was pervasive.

Chris Beaumont-Smith, a former senior official in the province’s mines branch who now operates his own industry consulting firm, said “The pendulum swung one way and now it is coming back.” 

Vale’s plan is to access additional resources by even going deeper down to around 6,000 feet below the surface.

Gary Eyres, Vale’s head of Manitoba operations, said it is still waiting for the investment approval from the company’s headquarters in Brazil.

“Once we get approval — and I am really confident we will get this approval — we are looking at nearly $8 billion in economic benefit to the region over the next 25 years,” he said.

Eyres said Vale is anticipating significant new demand for nickel to supply components for batteries in the emerging battery electric vehicle market to drive the demand for new investment. Right now, the global market for nickel from the electric vehicle industry is about 150,000 tonnes, and it is expected to increase almost fivefold in the next five years and to more than double again in the following five years.

“We believe the Thompson nickel belt is in a position to be one of the key providers for that new demand,” he said.

In the past couple of years, Vale has closed its nickel refinery and processor in Thompson and cut its Manitoba workforce by a couple of hundred people. While Eyres would not say that the new investment would necessarily add a lot of new jobs, it will definitely put a halt on the trend of declining job counts in Thompson.

Last year, spending on mineral exploration in the province was up 42 per cent. Although that increase compared to what was a historic low point, many in the industry believe there will be another increase this year. Vale alone is planning to spend $45 million on exploration in the next five years.

Shastri Ramnath, whose firm Orix Geoscience Inc. organized the conference in partnership with the Manitoba Prospectors and Developers Association, said the industry has suffered through the longest bear market in 50 years, but with gold prices on the rise and the increased demand for metals for things like the growing electric vehicle market, market conditions are finally improving.

 “We do feel a difference in the market,” she said, noting her own firm’s recent success in raising $2.5 million in the private market. Even attendance at the conference itself is up more than 50 per cent from last year, with about 500 people in attendance.

Ramnath is also chairing the province’s newly constituted liaison committee on mining and exploration, and she says it has the ear of the province.

“I have a direct line to the minister, I have the premier a couple of times. They are listening,” she said.

“When we make recommendations, they want to know how it will benefit the province.”