Mining: what’s it worth?

Everyone knows mining matters in the Yukon - but how much is it worth, exactly? It's a tough question, because the industry's economic impact includes far more than the cost of digging holes in the ground and trucking shiny ore

Everyone knows mining matters in the Yukon – but how much is it worth, exactly?

It’s a tough question, because the industry’s economic impact includes far more than the cost of digging holes in the ground and trucking shiny ore out.

Mining helps employ everyone from geologists to drill operators, from helicopter pilots to hotel staff, from assay labs to environmental engineers.

And it turns out nobody in the Yukon government tracks all the money mining brings in.

“It doesn’t all come down to a nice, neat number,” warns Scott Milton, the territory’s director of economic research.

But here’s what Milton does know: In 2010, approximately $150 million was spent on mineral exploration. That’s the biggest year on record, up from $90 million in 2009.

Mine production saw a more modest jump to an estimated $260 million, from $251 million. Expect it to continue to grow, now that the Yukon has three operating mines that should hit full stride in 2011: Capstone Mining Corporation’s Minto mine, Alexco Resources’ Bellekeno mine and Yukon Zinc Corporation’s Wolverine mine.

And $20 million was spent on mining cleanup, largely at the site of the old Faro mine. That’s up from $10 million in 2009.

Total direct expenditure for 2010: $430 million.

The trickier question is how much indirect spending this generated. On this, Milton wouldn’t hazard a guess. But he has a sense of how money and jobs trickle from mining activity through the economy.

This much he knows: when all three mines hit full-steam later this year, they’re expected to generate a total of approximately 600 jobs.

Yukon’s booming exploration industry led to the setup of five assay preparation labs popping up in Whitehorse last summer. They employed close to 100 people in Whitehorse last summer, by Milton’s estimate.

Beyond that, Milton runs out of numbers. But he’s noticed that one new engineering and environmental consulting firm recently opened, and other such companies are hiring.

Transportation companies are also bustling. That means jobs for truckers and pilots.

“There’s a real rush on helicopters this summer,” said Milton.

He was in Vancouver for the annual mineral exploration meeting this week, and many of the miners he met were having trouble finding pilots to hire. Yellowknife-based Trinity Helicopters announced this week it would open shop in Whitehorse.

Yukon’s drilling outfits are equally busy. The same goes with geologists.

And, as miners must eat, drink and sleep, the mining rush is good news for hotels and restaurants.

Whitehorse’s Town and Mountain Hotel, for example, is doing booming business with Selwyn Resources, a company that’s exploring a big lead-and-zinc deposit near Howard’s Pass, 220 kilometres southwest of Watson Lake.

When workshifts are flown out of camp, they bunk at the hotel. Last week, half of the hotel’s 30 rooms were taken up by Selwyn’s workers. That’s pretty busy for the depths of winter, said general manager Kayle Fleming.

“In November, it was full every day,” she said. “It’s really good for the territory.”

Contact John Thompson at johnt@yukon-news.com.

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