Yukon’s reputation as an attractive location for mining investment has suffered in the last year, according to an annual survey of mining companies.
The Fraser Institute’s 2015 survey ranked the Yukon 12th out of 109 jurisdictions around the world in terms of its ability to encourage investment. That’s down from sixth place out of 122 jurisdictions in 2014.
This year’s survey was completed by 449 individuals working in mineral exploration, producing mines and consulting companies. The respondents, who were mostly presidents, vice-presidents and managers, were asked to rate the mineral potential of jurisdictions they were familiar with. They were also asked how each of 15 policy factors influenced their investment decisions.
Analysts then combined the mineral potential and policy perceptions to calculate the overall investment attractiveness of each jurisdiction.
This year’s top spot went to Western Australia, with Saskatchewan in second place. Yukon was ranked third among Canadian jurisdictions, after Saskatchewan and Quebec.
The Argentinian province of La Rioja finished at the very bottom of the list, replacing Venezuela, which ranked last in 2014.
Taylor Jackson, a policy analyst with the Fraser Institute, said Yukon’s performance is “not bad overall.”
Yukon placed fourth for its mineral potential, which Jackson called a “top performance.” Still, that’s down from first place in 2014.
But the territory fared worse in policy perceptions, placing 39th in the world. Its policy ranking has been dropping steadily since 2012, when it landed in 13th place.
“For the Yukon, I think there should be a little bit of concern,” Jackson said. “Are they missing out on opportunities for exploration and investment in the territory?”
Survey respondents were asked to rate the jurisdictions according to 15 policy criteria, including environmental regulations, regulatory duplication, taxation, land claims and trade barriers.
For Yukon, Jackson said, “there are two areas that really stand out … and that’s uncertainty from protected areas and uncertainty on disputed land claims.”
The territory placed near the bottom of the list for both those criteria, landing in 99th place out of 109 for uncertainty around land claims.
Yukon also fared poorly in terms of the quality of its infrastructure, ending up in 81st place. But Jackson said that’s a harder obstacle to overcome in Canada’s North.
“This is something that comes up that really does separate the territories from the provinces,” he said.
The report doesn’t specify which land claims and protected areas have caused the uncertainty. But it does include comments from a couple of respondents.
“A mine was initially permitted to extract ore from one deposit; subsequent discoveries meant that permits had to be amended to accommodate additional mining,” reads one comment from the president of an exploration company. “Each amendment took several years, longer than the mine-life of the new deposits being permitted for mining.”
The vice-president of an exploration company also criticized the Yukon Environmental and Socio-economic Assessment Board, writing that “These boards often outsource expertise to consulting firms to advise the board on the adequacy of proponent submissions, and the information requests and demands from these consultants and the board are strangling the industry at what should be a planning level study.”
YESAB has recently come under fire for referring two major projects, Northern Cross and Casino, to higher levels of assessment. Critics have said the board is understaffed and inefficient.
But in the category most likely to reflect those criticisms, regulatory duplication and inconsistencies, the Yukon didn’t score as badly, landing in 36th place.
Still, Yukon was ranked third in Canada in terms of room for improvement, behind the Northwest Territories and Nunavut.
The territory was ranked first in the world for investment attractiveness in 2011 and 2012, but dropped to eighth place in 2013.
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