AEC Report on Mineral Development in the Arctic Released
The AEC’s Working Group on Responsible Resource Development under the leadership of co-chairs Lillian Hvatum Brewster (ATCO Group, Canada) and Bruce Harland (Crowley Maritime, USA) has released its first report focusing on mining in the Arctic. The report titled “Mineral Development in the Arctic” provides insights and an exchange of ideas around mineral development projects in the Arctic. The report is a consolidation of insights from a wide spectrum of Arctic stakeholders with a specific focus on mining in the North American Arctic. It includes feedback from companies that have developed Arctic mining projects and what made them successful, as well as from other stakeholders representing Indigenous groups, potential Arctic investors and government entities.
According to the findings of the report, mineral development in the Arctic must be conducted with a comprehensive plan to create sustainable economic benefits, consistent with the aspirations of the people of the region. Successful projects in the Arctic recognize the partnership with indigenous peoples and the role of indigenous knowledge, if chosen to be shared, in the project design. The corporate sector must also work “beyond regulatory compliance” to build trust and create healthy relationships and to earn their “social license to operate”.
With large distances between populated centers in the Arctic, resource development projects are often located at distance from communities. To address workforce and capacity-building efforts, there is a need for collaboration between the project developer and governments (national and regional) as well as the local communities including indigenous communities.
The lack of developed infrastructure in the Arctic results in increased costs and has blocked the development of many known ore deposits. In most cases, mining operations in the Arctic must construct their own infrastructure and provide their own power generating infrastructure. Future responsible resource development of the Arctic requires an intentional joint approach between governments, project developers and local communities in developing shared infrastructure that can benefit local residents, entice future economic development in a sustainable manner, and meet the need to protect the Arctic environment. This can be achieved through financial partnerships between governments, resource developers, and indigenous organizations where costs can be shared across multiple end-users through the use of public-private partnerships and through tax incentives.
Improving regulatory certainty, while reducing permitting delays, with strong government support enables Arctic projects to minimize unnecessary delay and expense. The AEC calls for fairness, timeliness and predictability in regulations.
Further, the AEC calls for a harmonized approach between different levels of government with the ultimate goal of “One Project, One Review” with clearly defined timelines. In a global arena, where the costs are lower, a predictable and streamlined approach to permitting can provide the Arctic a comparative advantage.
The availability of accurate, well-documented information on the existing environmental and socio-economic conditions in the potentially impacted region is a precondition for an effective assessment of a proposed resource project. If jurisdictions want to encourage investment, having objective (usually government-funded) data could greatly aid project permitting.
There are often unrealistic expectations about the amount of potential wealth that will be generated by mining. It is imperative that industry and the government educate local communities about the timelines and high capital costs of mining versus other industries.
The report Mineral Development in the Arctic is available through the link.
