The Mining Industry in British Columbia

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BC’s mineral exploration, development and mining industry experienced steady production growth in 2012, but a drop in commodity prices and higher costs for labour and raw materials put a squeeze on profits. BC’s mining industry is preparing for another challenging year as market volatility continues and commodity prices fluctuate.

Still, demand for key resources produced in BC, such as steelmaking coal and copper, are expected to remain strong, driven by demand from rapidly industrializing countries such as China and India.

The latest edition of PwC’s BC Mining Industry Survey shows mining companies are continuing with plans to grow production, but with a cautious eye on rising costs and the kind of mining industry cyclicality they’ve come to expect.

2012 Financial Highlights

BC gross mining revenues fell to $9.2 billion in 2012, down from $9.9 billion reported in 2011, due largely to lower prices of coal, copper and other metals compared to the year before.
Pre-tax net earnings across the industry fell to $1.8 billion, down from $3.7 billion the year before, while cash flow from operations decreased to $2.2 billion in 2012 compared to $4 billion in 2011. Both drops are due to rising costs for labour, energy and raw materials.
The number of people working in BC’s mining industry increased to 10,419 in 2012, up from 9,310 in 2011.

Challenges and Opportunities

Apart from volatile commodity prices and rising costs, attracting and retaining skilled labour to mining operations in BC remains a top challenge for BC’s mining industry. The industry has responded by developing and participating in a number of education and training programs to attract workers, in particular from underrepresented segments of the population including Aboriginal peoples, women and new immigrants. The hiring of temporary foreign workers was a hot topic in BC’s mining sector in 2012.

New Mines

In the summer of 2012, New Gold Inc. celebrated the opening of its New Afton mine near Kamloops, BC. New Afton was the second major-metals mine to open in B.C. since 1998, followed by the opening of the Copper Mountain Mine in 2011.

Looking ahead, the next large mines slated to open are Thompson Creek Metals Company’s Mount Milligan project and Imperial Metals Corporation's Red Chris project, which are both currently under construction. There are a number of other projects in the pipeline which are in the development stage.

Mining projects in the northwest of BC will get a boost from the 344-kilometre Northwest Transmission Line currently under construction.

For more information and trends in BC’s mining industry, please see the complete BC Mining Industry Survey.

	Stay the course: The mining industry in British Columbia 2012 — Summary of highlights (92.8 KB) Download the full PDF.

	Stay the course: The mining industry in British Columbia 2012 — Appendices (116 KB) Download the full PDF.