The Public Image of Mining – PDAC President Scott Jobin-Bevans Speech at the Calgary Mineral Forum (April 12, 2011)

The Prospectors and Developers Association of Canada (PDAC) advocates to protect the interests of the Canadian mineral exploration industry and to ensure a robust mining sector in the most environmentally sustainable and socially responsible manner possible. 

“If the mining industry is unwilling to talk about its achievements, how can we expect Canadians to understand and value it?” (PDAC President Scott Jobin-Bevans – April 12, 2011)

Good evening everybody.

I’d like to thank Darren Anderson for inviting me to the Calgary Mining Forum’s 20thanniversary. The first years of any organization’s life are the most challenging so M-E-G [Mineral Exploration Group] has reached a milestone.

I understand there’ll be some oil and gas folks here tonight so I’m please that MEG is helping two streams of geology maintain their connections.

Over the last 20 years, a number of the PDAC’s board members have come from MEG. Michael Marchand, president of Leeward Capital, was just elected for his third term at our convention last month. And MEG’s past president, Sherri Hodder, who shares my interest in student recruitment, is one of our newer directors, elected in 2009.

Before them, Karl Glackmeyer, MEG’s first president; Ron Netolitzky, whose exploration success is well-known and the one-of-a-kind Jim Kelly, were all elected to the PDAC board.

Jim is a geologist with an talent for cartooning.

His biting cartoons ran in the PDAC’s newsletter during the ‘80s and ‘90s. He delighted in lampooning the smug and self-satisfied. In this one he’s going after one of his favorite targets, government bureaucrats. Geologists who condescended to prospectors, were also popular targets.

He drew this one back in 1988 but you won’t be surprised to see that his message is still timely.

The PDAC values the unique contributions that all our Alberta directors bring, even if they aren’t all cartoonists.

Tonight I’m here to talk about something that’s been in the news recently. That’s a sense that the public’s impression of our industry’s performance on social responsibility hasn’t been good enough.

I spoke to Queen’s engineering students last month. Do you know that Queen’s geological engineering department used to count on attracting between 10 and 15 cent of the second-year students choosing geology as their specialty. That rate has dropped into the single digits now and isn’t showing any signs of rising.

Since the PDAC began organizing opposition to federal Bill C-300 in 2009, we’ve heard one clear, consistent message from government officials. They told us that we need to be doing more to counteract the misinformation put out by anti-mining activists. They’ve urged us to tell our own stories and not leave it to our critics.

C-300 was a shot-across-the-bow for the mineral industry.

Tonight I’m here to tell you that the PDAC and other industry leaders believe the time to act has come. And tonight I’m going to show you one of our first communication initiatives.

The PDAC, other industry groups and companies spent a great deal of time and effort informing MPs about the problems posed by C-300.

C-300 was portrayed by its supporters as a motherhood bill that would impose accountability on the resource sector. Unfortunately, they misunderstood the accountability standards already in place. And the bill was ill-conceived and poorly written.

Had it become law, a single complaint would have triggered a lengthy international investigation by a Canadian cabinet minister that could have paralyzed a company’s operations. It had the potential to allow any anti-mining activist or even a competitor to raise havoc at a company with impunity.

After more than 18 months of a public misinformation campaign, the bill was defeated. But the margin was narrow –just six votes. And more bills are coming. So the industry is making plans now and you’ll be hearing more in the coming months.

Here are some of the early plans we have.

  • Support and strengthen Canadian government’s CSR strategy
  • Create a CSR Leaders Forum to deal with difficult issues as they arise
  • Continue raising awareness of CSR improvements
  • Create a new mechanism for improving industry’s communication about CSR practices and our good CSR works using:

1) Monthly newsletter for MPs with case studies of good CSR practices

2) CSR video with perspectives from different practitioners, including those with experience in developing countries, local communities, financial sector participants and government officials

As you can see, some of these go much farther than mere communications initiatives.

Ottawa’s CSR strategy, for example, has the potential to be quite useful in resolving disputes that reach federal Extractive Sector CSR Counsellor Marketa Evans. And we’ll work to help it operate effectively.

But communications is important too.

The first issue of the monthly newsletter has already been distributed to MPs and the early feedback was positive.

And the new CSR video, which will discuss CSR from a variety of perspectives, will help stakeholders better understand CSR. In the future it will probably be used for public audiences.

But tonight I have the pleasure of giving you the first external viewing of another of the PDAC’s new communications initiatives.

We’re starting with short videos that tell the stories of mineral exploration success. One of the PDAC’s on-going objectives is to highlight the importance and value that exploration brings to the economy. We intend to show these at events for key audiences, including MPs and the business community.

The first video tells the story of Shawn Ryan, whose ingenuity and hard work led to two important new gold discoveries –and a major staking rush –in the Yukon.

It captures the thrill and challenge of methodical grassroots exploration. But it’s a story that most city-dwelling Canadians have no direct exposure to.

Ryan is the son of a Timmins miner who moved to the Yukon and went looking for the source of the alluvial gold that triggered the Klondike gold rush.

TO VIEW THE VIDEO CLICK THE FOLLOWING LINK: http://www.pdac.ca/pdac/programs/awards/award-winners-video-dennis.html

Ryan’s discovery of the Yukon’s now-famous White Gold deposit has caused a surge in exploration activity there. Premier Dennis Fentie says in the first nine months last year, 48,000 new claims were staked, bringing the total number to more than 150,000.

By comparison, in the 1890s, at the height of the Klondike rush, there were just 17,000.

The government says the mining industry now contributes $800 million to the territory’s economy annually. That’s getting close to the size of the government’s entire $1 billion budget. And that’s well before Ryan’s discoveries reach the pre-feasibility stage.

Shawn Ryan’s story is a great example of the value mineral exploration brings to Canada when a discovery is made.

By telling our good stories, the industry hopes to offset the anti-mining campaigns that repeat stories, which are often vague, incomplete and misleading.

The stories get passed along like whisper campaigns. And, like whisper campaigns, each time they’re told the extremes get magnified, distorted and reduced to simple tales of good and evil.

Unfortunately, the real stories aren’t black-and-white, good-and-evil. They’re much more complicated to explain and understand. And in the real stories, mistakes are usually made by everyone, not just the mining company.

As a result, tend to be too complicated to be conveyed in the 20-second sound bites the media and the public need.

Nevertheless, for every company that finds itself in the headlines for the wrong reasons, hundreds of others are working away untroubled and usually unnoticed.

But one bad story seems to take on a life of its own and harms the public’s impression of the entire industry.

TVI Pacific is an example of company that got into trouble, despite its good intentions. TVI is based in Calgary, so many of you may already have heard at least the first chapter of its story.

But there’s more. TVI’s founder and CEO Cliff James, says that when it began working on a copper-zinc-gold project in the Philippines in 1994, the company intended to behave responsibly.

Although not required by law, TVI tried to get off to the right start by making a gesture of good faith to the local indigenous group and signing a Memorandum of Agreement with the local indigenous people. It also chose to relocate local small scale miners, rather than just remove them. But those illegal miners left behind an ecological disaster of crude, leaky tailings ponds that fed mercury and cyanide into the local watershed and degraded the area’s water supply.

In time, TVI was blamed for the water degradation caused by the small miners. Local people grew confused and then concerned. Gradually protests and blockades started. Soon some NGOs joined the fray.

The company faced many false and overblown allegations, including reports that it had been involved in suspicious deaths. By 1999, it was spending more time fighting allegations than working on the project.

So James shut it down and turned the company’s attention to rebuilding its reputation. TVI spent four years working with the local people to demonstrate its commitment to sustainable mining and working with the communities.

In 2004 it resumed work on the first phase of the Canatuan mine development. In time, locals, including the local indigenous people, responded favourably.

TVI has built roads and infrastructure. It’s helped construct schools and it provides a medical clinic. It hires teachers and medical staff to run them and it’s helping communities develop new business opportunities that can continue after the mine eventually closes. James says the Philippine government’s website now cites TVI as a model for other mining companies to follow. Recently TVI has started work on new projects in the region and James says it is being welcomed.

He acknowledges that TVI made mistakes. Most notably, he says that although it worked closely with the national government, it should have paid more attention to local authorities.

James says he and TVI are committed to:

•Transparency
•Being responsible for protecting the environment
•The right to life, dignity, and sustainable development for all in its host communities.

Commercial production began at the Canatuan mine site two years ago.

But despite the improved relationships with the local people, James says that a few NGOs continued to regurgitate stories about TVI’s past problems, making it sound as if they were still going on.

Finally James decided he had to take a stand.

His law firm wrote a letter to the anti-mining NGO that was the most provocative and that had refused repeated invitations to meet with the company.

The letter cautioned the NGO against repeating false stories. And, to TVI’s relief, the NGO complied and has not continued publishing them.

TVI has now accomplished much of what it set out to achieve when it started. Its mine is in commercial production of copper, gold, silver and zinc. It has built good relations with most local people and its new projects are moving ahead.

But its share price is languishing and no one can say if, or when, its reputation will fully recover.

Managing geology and environmental science can be easier than managing complex community relations in developing countries.

People living in remote and poor locations far from cities often lack adequate education and become concerned when they get false and misleading information from provocateurs.

But when community engagement is carried out carefully, it can create positive relationships, leave an ongoing legacy for the communities it touches and contribute to sustainable development. It can also reduce a company’s risk.

With that goal in mind, the PDAC has introduced e3 Plus: A Framework for Responsible Exploration. Had it had been available 17 years ago, when TVI went into the Philippines, perhaps it would have laid the groundwork for a better outcome and helped avoid some of the early challenges.

I’d encourage each of you, whether you’re heading a company, advising one or working in the field, to go the e3 Plus page on the PDAC website and take a look.

e3 Plus is the world’s only comprehensive guide to environmental stewardship, health and safety and social responsibility developed exclusively for the mineral exploration sector.

It contains hundreds of pages of detailed information on a variety of the challenges companies face at projects.
 
Go the website and take a look. And don’t miss the three toolkits because they contain up-to-date best practices that can put you on the right path to addressing many of the challenges you’ll run across.

They’re packed with practical information and I promise you’ll find something useful that you didn’t know before you opened it.

Although each of the toolkits contain hundreds of pages of detailed information they’re designed to be dipped into by topic. If bears are getting into camp garbage, check out the bear section of the Health and Safety toolkit. If your site managers have suspicions that a contractor might be using forced labour, check the Social Responsibility toolkit section on human rights for tips on how to investigate and manage it effectively.

In the belief that most Canadians have little idea of the kind of responsibilities companies have to take on when they have projects in developing countries, the next video focuses on the company that won the PDAC’s Environmental and Social Responsibility Award at the convention last month.

IAMGOLD has earned a reputation for being at the forefront of leading industry practices in corporate social responsibility. It began developing a company-wide program several years ago to foster health and safety and sustainability at its operations in Africa, Canada and South America.

Here’s how IAMGOLD has approached CSR:

TO VIEW THE VIDEO CLICK THE FOLLOWING LINK: http://www.pdac.ca/pdac/programs/awards/award-winners-video-environmental.html

IAMGOLD’s third place in the Globe and Mail’s CSR ranking, was the highest achieved by a resource company.

It was surpassed only by two consumer good companies who operate within Canada and who, as a result, do not, unlike IAMGOLD, have complex international responsibilities for such things as building homes for local people, providing education and helping to develop sustainable economic options in remote communities.

That’s a great performance. It’s a story that our industry, and all Canadians, can be proud of.

And it’s only one of many great stories. I hope you’ll all join the PDAC and start telling your shareholders, your investment bankers, your friends and neighbors, some of those stories in the coming months.

Thank you for your interest tonight.

If you have any questions, I’d be happy to try to answer them and I’d like to hear what you think.

END

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