The Mining Association of British Columbia

The Mining Association of British Columbia

May 16, 2006 14:10 ET

The Mining Association of British Columbia: Mining Industry Posts Record Results

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - May 16, 2006) - The British Columbia mining industry showed phenomenal gains in 2005, but it will take the support of both the federal and provincial governments to sustain the good news for years to come, according to Michael McPhie, president and chief executive officer of the Mining Association of British Columbia (MABC).

"International demand and record high commodity prices are taking our industry to new levels of profitability," said McPhie. "But so far our results are based on existing mines running at full capacity and not on any significant new growth."

Results for 2005 released today by PricewaterhouseCoopers in its annual survey and assessment of the industry's overall performance show that gross mining revenues were at $6.29 billion, an increase of 37 per cent over 2004, which was considered an extraordinary year for the industry. Other key statistics from this year's release include:

- Net mining revenues have increased to a record $4.9 billion.

- Net income increased by $970 million to $1.8 billion in 2005. This is by far the highest annual earnings ever recorded in the history of the survey.

- After-tax return on shareholders' investment increased significantly from 29.4 per cent in 2004 to 54.1 per cent in 2005.

- Exploration expenditures in British Columbia increased to $220 million in 2005, up from $130 million in 2004.

- Direct employment increased to 7,071 in 2005 up from 6,442 in 2004. Factoring in both exploration jobs and indirect jobs from the service and supply sector, this number jumps to more than 25,000 people employed in jobs directly relating to the industry.

McPhie noted that although three new mines opened up in 2004 - the first mines to open since 1998 - only one opened in 2005. Another 18 significant metal mining and coal projects are making their way slowly through the permitting and environmental assessment process. New mines are necessary to ensure BC will be able to supply what is expected to be a continued strong demand for its products for many years to come.

"It now takes eight to 10 years to take a project from greenfields discovery stage through to production," explained McPhie. "Our industry supports the need for a thorough and comprehensive permitting process, but not the prolonged decision-making and bureaucratic overlaps we have seen in recent times."

"The new government of Prime Minister Harper has indicated to our industry that regulatory and permitting reform with the objective of providing greater certainty and confidence to both industry and communities is a priority and we look forward to working with him and his ministers in the months ahead.

"Failure to act in the near term could jeopardize billions of dollars worth of development, thousands of new jobs and economic opportunities for all regions of the province."

McPhie acknowledged the provincial government for its commitment to working with the industry, focusing on key training and workforce issues, extending the very successful flow-through share program and establishing a new relationship with First Nations, but cited the electrification of Highway 37 as an example of where action is still necessary.

"BC's mining industry is counting on this government for the leadership on moving the Highway 37 project forward," he said. "This is a project that is good for the whole province."

Board of Trade Speech

Michael McPhie will be speaking to the Vancouver Board of Trade today to discuss the state of the industry and key success factors for the future. A full copy of his speech will be available by 11:30 am today on the MABC web site at www.mining.bc.ca.

About the MABC

The Mining Association of British Columbia speaks on behalf of the 45 companies with producing or advanced development projects in the province, representing the majority of BC's mining and mineral industry.

Contact Information

  • Mining Association of BC
    Michael McPhie
    (604) 681-4321, local 120 or Cell: (778) 772-0528
    www.mining.bc.ca
    or
    Contemporary Communications Ltd.
    Andrea Freer
    (604) 637-3045 or Cell: (604) 488-4301