Engineering and Contracting
Shaping the future: Ontario's mining service providers navigate the new year's terrain
The buzz surrounding critical minerals has prompted mining companies in Ontario to redirect their exploration and development efforts to the north, in pursuit of unlocking a potential treasure trove of green gold. Yet, these colder, more remote regions pose unique challenges. This hive of activity resulted in a 30% increase in mining claims in Ontario’s Ring of Fire from 2022 to 2023. Luckily, mining service firms across Ontario are ready to help.
“Clients operating in these challenging environments require partners that understand the unique challenges they face,” stated David Oliphant, the VP of business development at Veolia Water Technologies Canada. “Veolia’s technologies are designed with a small footprint, making them particularly suitable for remote areas. This small-footprint technology is not only robust but also highly efficient, making it easier to transport and install in areas where logistics can be challenging,” explained Oliphant.
Remote operations deem onsite services more valuable. Bureau Veritas has developed an onsite lab service offering for battery minerals clients. “This helps to reduce their carbon footprint, remove the use of acids on site, and support the mine to have a cleaner and less labor-intensive process,” said Jon Landau, vice president of minerals North America at Bureau Veritas.
Navigating mine development in 2024
Ontario’s mining companies will have to contend with stubbornly high inflation and sharp dips in the prices of certain critical minerals like lithium and nickel. “One notable trend we have observed recently is a significant pressure on profit margins at many operations. This is primarily driven by a combination of escalating costs with sky-high inflation increasing expenses across the board,” said Andrew Hall, CEO, AMC Consultants.
With funding drying up for juniors, competition for capital is high, and according to Pierre Julien, executive vice president at DRA Global, it is easy to fall into the trap of allocating more time and money to raising funds, instead of technical work: “The mining industry fails to deliver projects successfully, with four out of five projects failing to meet budget and schedule. A recurring problem is the lack of well-defined scope and insufficient technical groundwork in the early stages of project development. Often, there is inadequate drilling, geotechnical understanding, and metallurgical testing.”
2023 saw certain traditional precious metals miners dip their toes into critical minerals, such as with Agnico Eagle’s recent C$23.1 million investment in Canada Nickel Company. “Traditional base metals miners are increasingly venturing into [the critical mineral] space, and we have been accompanying them on this journey. The current landscape is marked by intense exploration efforts by base metals miners seeking additional deposits of critical minerals,” said Byron O'Connor, vice president - mining, Pinchin.
As prospectors move away from their bread-and-butter minerals and rush to take advantage of the high government and investor interest in critical minerals, technical rigor must not be left behind. The importance of solid technical work cannot be understated, as evidenced by the recent failure of Pure Gold Mining with the Madsen gold mine, resulting in the company’s insolvency and a potential class-action lawsuit. “Projects built on preliminary studies without full feasibility assessments can face significant challenges. It is important to invest more in the project's technical base to make it more attractive for funding and avoid struggling to get more funding later,” continued Julien.
License to operate
In December 2023, Canadian producer First Quantum was ordered to close its Cobre mine after protests erupted across Panama against the mine. Despite the Cobre mine accounting for around 5% of the country’s total GDP, the public’s environmental concerns prevailed. The closure goes to show that maintaining a social license to operate is crucial and public perception can change rapidly.
For precious metals miners, maintaining a social license to operate is arguably even more important than their counterparts in critical minerals. Although many precious metals do have a role to play in the energy transition, the general public is more likely to associate gold with expensive jewelry than photovoltaic panels. “Precious metals face ideological pressures related to environmental concerns, particularly the carbon footprint associated with gold operations,” said Chris Dougherty, president and chairman, Nordmin Engineering.
Ontario is lucky to benefit from a rich mining history, strong environmental and safety laws, and low public sector corruption levels compared with many other jurisdictions globally. Ontario’s mining sector will have to work even harder to maintain these in the coming years by engaging with communities and maintaining the highest ESG credentials possible, as younger generations become increasingly wary and hostile towards extractive industries. Eric Smith, managing director at Cementation Americas, a large global mine contracting and engineering company, shared his thoughts: “On the whole, Canadians show greater awareness and support for mining, whereas in the US, there is often a lack of understanding when it comes to modern mining amongst the general public. Permitting in Canada seems to have a more measured approach, whereas in the US, changes with each administration can impact years of progress. Despite challenges in both jurisdictions, Canadians typically display more support for mining, balancing economic benefits with stringent environmental expectations.”
Canada’s complex and thorough permitting process for mine development is a double-edged sword. While it maintains the country’s ESG standards, it can sometimes come at the expense of clarity for stakeholders, discourage prospectors, and deter impatient investors. “In my experience, the permitting process in Canada tends to be slightly longer than in Australia. In Canada, objections to development can come from various parties at any stage, leading to uncertainties,” said Zimi Meka, co-founder and CEO, Ausenco.
The heavy regulatory burden and red tape in Ontario extends not only to developers and producers but also to OEMs and suppliers in the mining sector. “Recently, we have faced significant regulatory hurdles to expanding our facility. This challenge is felt by a lot of manufacturers in Ontario and slows things down,” said Andrew Guiducci, president of Domite Wear Technology, a Canadian-owned manufacturer of specialized long-lasting wear products for the mining industry.
Mining for data
Mining to meet the green energy transition comes with the weight of monitoring an operation's carbon footprint. EY’s Top 10 business risks and opportunities for mining and metals in 2024 report stated: “ESG is attracting more scrutiny from investors and the community. Better use of data and a focus on net-positive impact can help meet growing expectations.”
The collection, interpretation and use of data will be paramount for incorporating ESG into operations. For remote operations, though, data collection becomes complex. "Some regions may have limited bandwidth and challenging connectivity, which can slow down technology adoption," emphasized Rob Ferguson the segment director of exploration and resource management at Seequent.
Seequent developed two new technologies to help. “MX Deposit, for instance, is designed for drill hole logging and data management, streamlining the process. We also offer Imago, a tool that captures photos of drill hole cores. These photos are then promptly uploaded to the cloud, where they can be accessed, analyzed and integrated into the modeling workflow. The cloud's real-time accessibility is pivotal, allowing mining professionals to make informed decisions while drilling is in progress, reducing costs and environmental impact,” described Ferguson.
“Mine owners and operators are learning the value of robust data collection. For example, core scanning technology and underground use of LIDAR-based mapping are now being used to collect data quickly, and in areas that are challenging to access,” explained Kathy Kalenchuk, president and principal consultant at RockEng.
As Canada suffers heightened inflation, its mining sector is finding inventive ways to collect more data with less time and money: “There are economic benefits to co-collecting LIDAR, spectral, radiometric, time-domain EM, and magnetic data in one flight. Our approach is to minimize data collection costs while maintaining data quality by working around the limitations of flight parameters and instrument interference,” said Doug Engdahl, president and CEO of Axiom Exploration Group.
How data is used afterward is just as important as how it is collected. “Too much data can lead to inefficiencies, making it challenging to extract valuable insights from the overwhelming volume of information,” said Mary-Jane Piggott, vice president of the mining environmental group at Klohn Crippen Berger.
“Ultimately, despite the technological tools at our disposal, the responsibility for data quality remains with humans,” said Eugene Puritch, president and principal mining engineer at P&E Mining Consultants.
Article header image courtesy of Argonaut Gold