The B.C. government risks putting a major chill on mineral exploration and investment in B.C., if it rewrites the Mineral Tenure Act in a way that removes a key incentive for prospectors to file mineral claims, the Association of Mineral Exploration (AME) warns in a new report.
The B.C. government is currently in an engagement process for revising the Mineral Tenure Act and Mineral Tenure Online (MTO) system, in response to a court ruling that found that the claim staking process in B.C. may violate the Crown’s duty to consult First Nations.
In a court case that challenged the Mineral Tenure Act, the Gitxaala and Ehattesahet First Nations raised concerns about mineral claims being filed in their traditional territories without their knowledge or consent.
They noted that under the current free entry process, anyone can go online and stake a claim without informing anyone, including First Nations.
The Gitxaala’s concerns had stemmed from a gold mine on Banks Island that had been staked without their knowledge and which later turned into an environmental liability when the government shut it down for multiple permit violations.
In a ruling last year, the B.C. Supreme Court denied the First Nations’ request for injunctions against mineral claims in their respective traditional territories, but agreed that the way mineral claims are staked could violate the Crown’s duty to consult First Nations.
Justice Alan Ross gave the B.C. government 18 months to resolve issues with the Mineral Tenure Act.
The B.C. government is currently in the process of reforming the Mineral Tenure Act, with the aim of having it conform to the B.C. government’s own Declaration on the Rights of Indigenous Peoples Act (DRIPA.)
The AME initially participated in consultations held by the B.C. government as part of the Mineral Tenure Act reform, but then decided to go its own way hold its own parallel consultations.
“The government began working with Indigenous nations across the province on a Mineral Tenure Act and MTO system,” AME president Keerit Jutla told BIV News. “However, that engagement didn’t have any industry input and would have likely built a system that didn’t work for industry. So members told us that they didn’t feel government was listening to them.”
The AME began its own engagement process in April to hear from prospectors and junior miners. It heard from 200 industry players at meetings held in Kamloops, Kitimat and Vancouver, and another 217 in online sessions.
One participant clearly did not have much faith in the B.C. government’s engagement process, suggesting it was a charade.
“The decision has been made,” one participant said, according to a report released today. “And this is a reverse engineering process where we are now in a public engagement [from government] that is meaningless, quite frankly.”
A key concern for prospectors is the incompatibility of two principles: claim staking confidentially and First Nations consent.
First Nations want to be informed at the earliest stage of mineral exploration – the staking of a claim.
But claim staking has traditionally been confidential. Prospectors, miners and mineral exploration companies don’t just randomly file mineral claims. A lot of preliminary work, such studying geological survey data, precedes the filing of a claim in an area they think might be worth exploring.
These claims are therefore considered a kind of intellectual property, and informing anyone that a claim has been staked, including First Nations, would be liking tipping one’s hand, and could prompt others to begin staking claims in the same area.
If the Mineral Tenure Act is reformed in a way that would require consent of First Nations before someone staked a claim somewhere, it could deter all future claim staking, prospectors warn.
“For prospectors, the value is the intellectual property of what resources may be at a claim,” one participant told the AME during its engagement process.
“In essence, the only value is created when a prospector sells a claim to a junior mining company for further exploration. Doing anything that alters the intellectual property of a claim means that prospectors have no reason to stake claims and it will put many small AME members out of business.
“Without the intellectual property, there is no incentive to stake a claim.”
“Since exploration companies spend considerable capital identifying potential mineral resources prior to staking a claim, revealing to competitors their interest in particular lands prior to staking a claim will put at risk their investment and intellectual property,” another participant said.
“The actual disclosure of a proposed exploration program goes against the grain of how industry thinks and will adversely affect whether major capital is spent in British Columbia.”
“The discussion about MTA reform really concerns me because I’m afraid if it’s not done very carefully there’s going to be significant capital outflow from British Columbia particularly from early-stage mineral exploration,” another participant warned.
Some prospectors agreed, however, that there are other problems with the current Mineral Tenure Online (MTO) staking system. As one participant noted, the fact claims can be staked online means prospectors no longer need to be in the field.
“This has led to a proliferation of what mineral explorers call ‘nuisance stakers,’ or speculators who stake property with no intention of exploring on it,” one participant said. “In some cases, companies have implemented bot programs that indicate when someone is actively staking online and automatically stake around them.”
The AME report urges that the confidentiality of claims be maintained in any reform of the MTA or MTO.
“Prospectors require confidentiality to ensure the value of their claims,” the report concludes.
“This represents a major issue with a new system as prospectors need to be able to share information with Indigenous nations and still ensure they have a right to the land, otherwise, there is no value in the asset, and they will have no incentive to explore it.
“We propose a third-party entity that could store the data and ensure confidentiality through the review process with nations.”
