Miners Need to be Wary of Ontario Premier McGuinty – By John Cumming

John Cumming MSc (Geology) is the editor of the Northern Miner, Canada’s global mining newspaper.  jcumming@northernminer.com

The week ended July 19, the 29th trading week of 2008, kicked off with a surprise announcement by the Ontario government that it would “protect” at least 225,000 sq. km, or roughly half of the province’s boreal forest.

The scope of the proposal is broad. It includes: banning economic activity within at least half the province’s boreal forest; holding meetings across the province with every conceivable stakeholder to come up with new land-use plans; giving local aboriginal communities veto power over proposed economic activities; revamping the way resource businesses are taxed, including more taxes going to local aboriginal communities; and building up bureaucracies to create and implement land-use plans.

The government also restated its intention to rewrite the province’s mining act before 2010, including changing the process for staking and exploration. It starts reviewing the act this August.

Given that you can’t trust anything Premier “I-won’t-cut-your-taxes-but- I-won’t-raise-them-either” McGuinty says, and that his professed environmentalism is driven by pure political expediency, figuring out what this latest proposal means for miners in Ontario is tricky.

On the one hand, McGuinty’s shabby treatment of De Beers as it developed Ontario’s first diamond mine — jacking up the royalty rate at the eleventh hour, after construction was well under way — shows the premier has no qualms about raiding a mining company’s coffers when the political fallout is minimal (after all, few hearts bleed for De Beers).

Of more concern to the little guy, McGuinty’s crushing of landowners and developers who tried to fend off his government’s creation of the greenbelt around Toronto shows the premier has little regard for basic property rights. Be forewarned: McGuinty holds the creation of the greenbelt as a model for his boreal forest plan.

On the other hand, it will takes years just to hold discussions with interested parties about how to establish a framework for more discussions. McGuinty himself says the whole process could take up to 15 years. The thing may never happen.

It looks like much of the seeming haste to come out with this latest boreal-forest proposal is fuelled by the provincial government’s larger agenda to boost taxes and increase the size and reach of government by using the global warming hoax as a pretext.

McGuinty is pitching Ontario’s boreal forest as a major carbon sink that presumably could be used to the provincial government’s benefit during upcoming rounds of carbon-emissions trading it is committing itself to.

It’s remarkable that, as more people realize that there isn’t a single bit of evidence that human activity is causing dangerous global warming, we see the rhetoric from the theory’s proponents is getting more hysterical: in promoting this boreal forest plan, McGuinty is now saying with a straight face that we can expect Ontario to be 8° C warmer within a century. This kind of foolish talk is another great argument for small government.

More pertinent to the mining industry is the very real revamping of the provincial mining act. Now is the time for miners to keep up the lobbying for the maintenance of a sensible regulatory regime for mineral exploration and mining in the province.

In particular, the mining industry needs to keep pushing the government to live up to its obligation to consult with aboriginal communities prior to granting exploration rights to mining companies, as it so spectacularly failed to do in the messy case of Platinex and the Kitchenuhmaykoosib Inninuwug (KI) First Nation.

We like the idea of local communities getting more of the taxes from resource industries active in the area, but only if it matches simultaneous reductions in provincial taxes.
 

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