Abbas Ali Khan speaks with Lexpert for their special edition on mining in Canada. He talks about the successes, opportunities and competition for Canadian miners and investors in accessing capital, mining regulation and supply chains.
Abbas says that with a skilled workforce, the financial centre, the infrastructure, and the resources, Canada is the "Silicon Valley for mining."
On Access to Capital
When it comes to attracting risk capital to the mining space, there has been a “significant competition” for investment in the last decade, including from the technology and cannabis industries, says Abbas Ali Khan, a partner at Bennett Jones LLP, whose practice is focused on the mining and technology industries.
“Even in the bull markets, there’s always a shortage of capital.”
Khan says Canada is competing for mining funding with Nevada and Australia, which are more friendly jurisdictions from a regulatory standpoint.
Canada has also toughened its reviews of foreign investments from state-owned enterprises. Innovation Science and Economic Development Canada recently forced three Chinese firms to pull their investments out of three Canadian lithium companies. While he notes that he is not criticizing the policy, Khan says it also adds to the funding gap.
On Mining Regulation
Khan says it takes around 15 years—and can take as much as 25—to bring a mine into production.
With both federal and provincial environmental impact assessments, Canada needs to adopt a “one project, one assessment” policy, says Khan.
In May 2023, Ontario gave Royal Assent to Mining Act amendments with Bill 71, the Building More Mines Act, 2023. The province said the legislation will expedite approvals and provide certainty for mining companies, and it is part of Ontario’s critical-minerals strategy.
Investment and Supply Chains
Khan says the federal critical-minerals strategy has done a good job of attracting manufacturers of battery metals. Whether it’s the General Motors facility in Bécancour, QC; the Volkswagen plant in St. Thomas, ON, or the Stellantis/LG Energy factory in Windsor, ON, federal and provincial governments are shelling out billions in subsidies to encourage auto manufacturers to produce their electronic-vehicle batteries in Canada.
To supply these and other factories with the required minerals, Khan says Canada needs to streamline the approval process to get more mines into operation. He says it must also enhance the supply chain with more refineries, smelters, and the necessary infrastructure to keep it humming.
Bennett Jones