Despite record-high gold prices, mining exploration in Canada’s North declines

Gold has long been a key focus of Canadian mining exploration spending, with efforts to find, assess, and develop mineral deposits into mines. Canada has established itself as a top gold producer globally, with the price of gold skyrocketing by 38 per cent in 2024, reaching historic highs.

However, a report from British Columbia revealed that despite the surge in gold prices, overall exploration spending in the province decreased by 14 per cent from the previous year. Exploration spending specifically targeting gold dropped by 24 per cent. According to Iain Thompson, a partner with EY Canada, various factors beyond commodity prices influenced the level of exploration spend, including projects in B.C. being further along the development life cycle and a global decline in exploration spending.

Updated data from Natural Resources Canada showed a mixed impact of gold’s price increase on territorial industry. While some provinces reported increases in exploration spending, others like the Yukon, Northwest Territories, and Nunavut, along with B.C., experienced declines between 2023 and 2024.

Calls have been made to ‘streamline’ regulations in order to attract more investment in the mining sector. In the Yukon, despite its gold deposits, exploration spending dropped by an estimated 9 per cent in 2024 due to uncertainty caused by legal challenges of projects. Similarly, the N.W.T. and Nunavut faced challenges in attracting investment due to complex regulatory processes.

Industry experts emphasized the importance of a streamlined regulatory environment to make resource development economically viable. The Yukon, B.C., and the N.W.T. are in the process of updating their mining legislation to create a more conducive environment for investment. However, challenges such as the failure to consider First Nations sovereignty in mining laws and proposed changes requiring consultation with First Nations before staking mineral claims have raised concerns among industry stakeholders.

Overall, ensuring the right regulatory environment is crucial for attracting investment in the mining sector. Failure to address industry concerns and streamline regulations could hinder future exploration and development efforts in Canada.