While they are some of the most resilient and innovative people I know, folks within the B.C.-based mineral exploration sector continue to face a prolonged venture capital crisis. Many AME BC members, particularly the juniors, have continued in survival mode due to the historic and unprecedented downturn in the venture capital market.

Uncertainty in the global economy has led to significant capital raising challenges for juniors. As recently reported by the Prospectors & Developers Association of Canada, the total number of financings on the TSX Venture Exchange in 2013 was one of the lowest since 1999, and year-to-date 2014 figures indicate a continued downturn. The limited amount of financing that did take place on the TSX Venture Exchange in 2013 was primarily for very small amounts – more than 50 per cent of all financings in 2013 were for $500,000 or less (compared to 13 per cent in 2010). A significant portion of all financings was barely enough to keep the lights on – 12 per cent of financings in 2013 were for $100,000 or less, compared to only 0.5 per cent in 2010. And according to Kaiser Research Online, approximately 60 per cent of Canadian-listed juniors had working capital balances under $200,000 as of October 2014. Given that it costs a minimum of $200,000 simply to remain a listed company, companies are in survival mode.

Furthermore, SNL Mining and Metals recently stated that exploration budgets for all juniors globally dropped 29 per cent in 2014, after falling 39 per cent in 2013. As a result, juniors are expected to account for only 32 per cent of global exploration budgets in 2014, down from a high of 55 per cent in 2007. Nationally, exploration expenditures from early through the preliminary economic assessment stages have declined from $2.86 billion in 2011 to $1.2 billion in 2013, with a marginal recovery to $1.25 billion expected for 2014.

The B.C.-based mineral exploration and development industry must continuously work to compete for international investment.

With reported exploration expenditures of $476 million in 2013, B.C. attracted an estimated 20 per cent of all exploration dollars spent in Canada, compared to just six per cent in 2001. Based on 2013 expenditure levels, 18 of the top 100 exploration projects in Canada are in B.C. As of August 2014, approximately 58 per cent of the mineral exploration and mining companies listed on the TSX and TSX Venture exchanges – 882 out of 1,527 – are headquartered in B.C., and two-thirds of equity capital raised in 2013 on the TSX Venture Exchange ($2.6 billion out of $3.9 billion) was raised by B.C.-based companies.

Given the ongoing global economic uncertainty, this is a critical time for AME BC to champion the investment, exploration and development potential of B.C. and to strengthen and reinforce strategic connections with government, business and industry leaders. For example, AME BC continues to advocate for the industry during government consultations about proposed application fees for Mines Act permits. AME BC holds the position that prospecting and exploration activities should be exempt from any such fees because these activities produce no revenue for prospectors and explorers. No other jurisdiction charges exploration permit fees, and such fees would be counterproductive to encouraging more investment in prospecting and exploring for new deposits in B.C. To date, permit fees have not been determined, although the government has already indicated that some exploration activities would be exempt.

We have also recommended that the B.C. government rebuild the Ministry of Energy and Mines by allocating an additional $10 million annually to address permitting and regulatory issues in a timely and effective manner. In addition, we advocated an increase in the annual funding of the Geological Survey of BC to $4 million and Geoscience BC to $10 million to support enhanced public geoscience for mineral exploration and development as well as improved geotechnical and geohazard assessment in British Columbia.

The B.C.-based mineral exploration and development industry must continuously work to compete for international investment.

As you are likely aware, final preparations are being made for AME BC’s Mineral Exploration Roundup 2015 conference, from January 26 to 29, under the Canada Place sails at the Vancouver Convention Centre East, and this issue of Mineral Exploration features a sneak preview of Roundup. This issue also features the annual B.C. mineral exploration and development review, and we take an in-depth look at one of this year’s newsworthy projects: Red Mountain. We also feature both a legal perspective on the Tsilhqot’in decision as well as an article on Aboriginal relations on the ground – in this case, B.C.’s aggregates industry. Our profile this issue is of self-described “serial volunteer” Lana Eagle, chair of AME BC’s Aboriginal Relations Committee and one of the forces behind The Gathering Place, which will connect industry and Aboriginal Peoples for the third year at Roundup.

This past summer, we at the Association mourned the loss of Bob Cathro, one of our past presidents, who played an active role in many B.C. & Yukon Chamber of Mines/AME BC initiatives over the years – notably, the founding of Roundup, the Rocks to Riches program that led to the creation of Geoscience BC, and the Into the Mountains 100th anniversary commemorative book on AME BC. He will be missed, and an article profiles his contributions to the industry.

Finally, AME BC is proud to participate in the BC Technical & Research Committee on Reclamation, and an article takes a look at this year’s successful symposium in Prince George. I encourage you to consider nominating your own reclamation work – particularly at the exploration and development level – for a Mine Reclamation Award.

On behalf of the staff and board of AME BC, I thank the many hundreds of dedicated volunteers of AME BC and I wish you a prosperous winter season and a safe day, every day, wherever this message finds you!