Over the next three years, the BC Government expects mining and mineral revenues to decline by 27% annually … that corresponds with current job losses in mining, quarrying, oil and the gas sector

Alberta’s Minister of Energy the
Honourable Margaret McvCuag-Boyd

Early last week Alberta’s Minister of Energy, the Honourable Margaret McCuaig-Boyd, announced a, "More efficient regulatory process means new oil and gas projects can begin operating faster, creating jobs and maintaining competitiveness as Alberta leads the country in growth."

Apparently, the new regulatory system will process applications quicker, prevent companies from having to repeatedly submit the same information, as well as having just one application to have one review, and one decision.

Margaret McCuaig-Boyd stated, “This new system, when completed, will bundle all of the applications, associated with a development, into a single application. This will cut timelines for approval dramatically, and save industry hundreds of millions of dollars a year.”

She went on, “The process makes use of software to eliminate the need for businesses to submit the same information over and over again. It’s fairer, faster, and more accessible. One application means one review and one decision.”

There is a lot of movement back and forth, between British Columbia and Alberta, in terms of financial resources devoted to exploration and development.  Obviously, one of the biggest determining factors, on where that money goes, is always going to be how quickly projects can get become reality.

Helping energy products begin operating faster is a win for investment, for competitiveness, and for employment opportunities.  McCuaig-Boyd’s Press Secretary, Mike McKinnon, quantified what’s recently been done, to give Alberta an improved competitive edge. 

“We’ve put a lot of work in, but there’s more work to do. Progress has been made on clearing a backlog of applications, but we need to continue to work with industry to identify other opportunities to be more efficient.”

“Competitiveness is a priority. We’re committed to addressing concerns about market access, and we’ve been standing up for jobs in our province by pushing for changes to federal legislation.” 

Meantime Kent Karemaker, a Media spokesperson for the government of BC, stated that the province has initiated an independent scientific review of hydraulic fracturing to ensure industry is meeting the highest standards ...  and that information is being compiled now, to provide findings and advice to the minister, before the end of the year.  Key here, at least to me however, is that actions following this are yet to be determined. AND … this apparently is to ensure industry is meeting the highest standards -- not streamlining things and getting projects on line sooner. 

And that could be at least one reason for the BC Mining Association’s (BCMA) concern about the recent BC Professional Reliance Review Report.  In the report, for example, it calls for the establishment of an Office of Professional Regulation and Oversight (the “Office”).  That office however would be, and I quote, “an agent of government, independent of oversight from natural resource ministries”

Hmmmm … an agent of the government, but independent of oversite.

The office will also have the mandate and authority to appeal certain professional organization decisions, like registration and disciplinary decisions, to the BC Supreme Court, and join other appeal proceedings as a third party to represent the public interest … and … research and develop best practices for professional governance in the natural resources sector. 

Commenting on the report in a media release June 28^th, Mining Association President Bryan Cox, stated the, “MABC supports the goal of ensuring that the highest professional, technical and ethical standards are being applied to resource management in BC.”

He continued, “The mining industry views an effective and efficient professional reliance model as a key component of maintaining the competitiveness of our natural resource industries.”

Here in BC, delays in getting resource development projects up and running, mean millions of dollars are not going into the economy.  It means Carole James Ministry of Finance is not collecting what it could and should, in tax revenues, to build new schools, infrastructure, and hospitals.  And it means new direct resource jobs are not being created.

But it’s not just those direct jobs that are important, its the missing spin-off jobs, and what they can potentially add to the economy. Employment in the natural resource sector, actually creates as many as five times the number of support jobs, as other segments of the economy! 

While the BC government feels stating that commodity prices have struggled over the last few years -- and that it's made an observable impact on employment in BC -- other jurisdictions are seeing increased employment through investment in exploration and development. 

According to Resource Works, in a report issued February 28^th, to the Honorable Doug Donaldson (Minister of Forests, Lands, Natural Resource Operations, and Rural Development) they stated:
“The fundamental economic truth underlying our current prosperity is that both rural and urban British Columbia are dependent on natural resource development. The inter-connectedness and dependency of both are so interwoven as to be inextricable; indeed, to some extent, the "rural economy" is a misnomer, since it is in fact the backbone of the provincial economy.

Despite that, it seems our BC NDP government is actually planning for that ‘backbone of the provincial economy’ to decline.  The three-year projection of BC’s Budget and Fiscal Plan, through to 2021, shows natural resource revenues declining every year. 

Budget estimates indicate revenues of $2.413 billion for 2018/19, dropping to $2.214 billion for 2019/20, and finally down to $2.184 billion in 2020/21.

Again, according to Media Relations spokesperson Kent Karemaker, the "government is committed to a strong economy that works for everyone and creates good jobs across the province."

He continued, "Mining and the oil / gas industry have an important role to play as we work to make life better and more affordable." 

Jobs … good paying jobs people can raise a family on, and buy a home if they choose to do so ... are needed now however, and the province cannot afford to see declines in revenues from the resource industry for a single year, never mind at least the next three!

So what's the bad news then?

BC's mining and mineral revenues expected to decline by 27 percent
annually over next 3 years ~~ Ministry of Finance, Government of BC

Just that over the next three years, in mining and mineral revenues alone, government expects to see revenues decline by 27% annually.

And jobs?  Well there’s more bad news on that front as well.

The August 10th Labour Force Survey indicated that despite increased employment happening in BC, job losses were being experienced in the mining, quarrying, oil, and gas sectors.  And those natural resource industries remain a very significant factor to our economy.  Resource jobs pay well, resulting in family-sustaining paycheques that are the foundation of numerous communities around BC.

Further confirmation of the importance of our resource industry in BC comes from the Mining Association of BC.  Mining activities in our province, in 2017, generated more than $11.7 billion in gross mining revenues, with companies investing $1.5 billion in capitol expenditures at their mine sites. Last year alone, the mining industry alone employed more than 10,000 British Columbians.

Back over to Alberta, time savings from their new regulatory process, at least according to them, will equate to more jobs there.

“By making the regulatory process more efficient, it simply means new oil and gas projects can get up and operating faster, which creates jobs and maintains our competitiveness”, said media spokesperson Mike McKinnon.  “Across industry this (new regulatory process) is expected to save (industry) $600 million by 2021. 

”Which is perhaps why February’s report from Resource Works indicated we in British Columbia need:
“Respectful, honest, informed debate focused on uniting values rather than divisive conflicts … dialogue should be informed by the best science, statistical analysis and economic studies we possess in order to present a clear picture of the importance of rural economies to the prosperity of the province.”

The report also indicated that:

“… rather than recognizing this foundational fact and working together to ensure our shared prosperity, BC is caught in an increasingly bitter and dysfunctional rural-urban divide. Rural communities feel threatened and disempowered as policies designed to appeal to urban voters make traditional resource development increasingly difficult and, in some cases, impossible. Urban residents feel no connection to the resource industries and energy sources that provide them with the modern consumer goods that they depend upon for their standard of living.”

Sadly, since being elected, actions by our government in BC have been inconsistent, and confusing.  While this comment was specific to the continuously delayed Trans Mountain Pipeline project getting started, I believe it is applicable across the resource industry: 

“This sends a message to the investment community that, even if corporations are willing to endure lengthy, expensive and exhaustive regulatory processes, projects may be delayed or made economically unviable at the last moment because of political considerations.”

So, what is our government, led by Premier John Horgan, doing to slow down our expected decline in jobs, and revenue, from the resource industry … or do they care? 

The government states, in a communication to me, that "Our government has taken action to increase investment, and revenue collection." 

Should we ask to what degree did the government forecast that new environmental and regulatory review processes would play a role in these declines in revenue?

The Mines Act, and Health, Safety and Reclamation Code for Mines in British Columbia, govern mineral exploration and mining in the province and provide the overall context for the professional reliance regime in the mining sector.

“The current professional reliance regime provided by the Act and Code is comprehensive and clearly articulates the roles and responsibilities of qualified professionals in relation to mine-related approvals,” said MABC President Bryan.  “Additionally, the environmental assessment and permitting processes for mines in BC.”

With Carole James Ministry of Finance expecting revenue losses, it seems we can safely say that through a number of areas and efforts, government is putting roadblocks in place, knowing full well what will happen.

Quoting Resource Works once again, from the conclusion of their February report,

“British Columbia is at a crossroads. We can continue down the current path where the Urban-Rural divide gets wider, where our regulatory regime is discredited and our economic opportunities diminish. Alternatively, we can blaze a new road to shared prosperity based on the strengths that have served our province well for generations.”

I couldn’t say it better myself.

In Kamloops I’m Alan Forseth.  The floors yours now, so please share your thoughts in the Comments Section directly below.