Thanks to rising revenue, exports, production and prices, the mining industry in British Columbia is racing toward a potential record year for exploration, development and production activity.

The province's mining boom is being fueled by the global recovery in manufacturing, and in particular the strong demand for raw materials in Asia, according to B.C. officials.

In 2010, the price of metallurgical coal rose by 70 percent, while prices for copper climbed 45 percent, silver by 37 percent and gold by 25 percent from 2009. In the first half of 2011, these prices continued to soar. Gold recently reached historic highs of more than US$1,600 per ounce, while metallurgical coal prices have climbed to significantly more than US$200 per metric ton. Copper is currently trading at historic highs of more than US$4.25 per pound, while silver prices have decreased recently, though they are still much higher than values from several years ago, according to BC officials.

Mineral exploration spending in British Columbia, which rocketed to C$322 million in 2010 - more than doubling the $154 million reported a year earlier - is expected to gain more altitude in 2011, while some analysts predict it could top C$500 million. There were 380 exploration projects active in the province in 2010 and BC officials expect that number and more to be active this year.

In this heated investment climate, new mines are opening, including one in northern British Columbia - Mount Milligan, a copper-gold mine located halfway between Fort St. James and Mackenzie. The project, owned by Thompson Creek Metals Co., is currently under construction and plans to begin operations in 2013. Other B.C. mines rushing out of the starting gate include the Copper Mountain copper-gold mine outside Princeton, which is set to open this summer, and the New Afton major copper and gold mine near Kamloops, anticipated to open in 2012.

In mid-July, Fortune Minerals Ltd. reported that it took a major step toward advancing its Mount Klappan Anthracite Metallurgical Coal Project in northwest British Columbia to production by entering a joint venture agreement with one of the world's largest steelmakers, POSCO of South Korea. Mount Klappan ranks among the largest undeveloped deposits of metallurgical coal with a vast resource, including 107.9 million metric tons (measured), 123.0 Mt (indicated), 359.5 Mt (inferred ) and 2.2 billion metric tons (speculative).

"The near-term outlook for the mineral industry in British Columbia is very positive. There are mine developments and expansions under way and more planned. Mineral exploration companies are actively searching in many parts of the province for the next generation of mines. You just have to follow the many reports in the media to see that mining is a key element of the province's economy, just as it has been since the 1800s," said Dave Lefebure, B.C.'s chief geologist.

The province's production profile is also noteworthy in that eight metal mines, 10 coal mines, more than 30 industrial minerals mines and 650-plus aggregate pits and quarries contribute substantially to BC's a C$7 billion mining industry.

Mining employed 28,400 people in 50 B.C. communities in 2010, including about 11,400 in production, 2,700 in exploration and the rest in smelting, refining and downstream mineral processing.

Stunning rebound under way

The dramatic revival of mining in British Columbia is further underscored by the industry's relatively bleak outlook 10 years ago. In 1999, for example, mining exploration expenditures totalled just $25 million. A 13-fold increase in such activity in less than a dozen years not only reflects market conditions but also a paradigm shift in the popular view of mining in British Columbia and federal and provincial support for the industry.

"This is a remarkable turnaround for the mining industry, which shows continued steady growth from the lows of the 1990s," said former Minister of State for Mining Randy Hawes when he proclaimed Mineral Exploration Week in British Columbia in January. "Policies put in place by this government have helped give the minerals sector the resilience to withstand the economic downturn that we've experienced recently, providing thousands of high-paying jobs in all corners of the province."

In addition to exploration spending, the mining industry invested more than $1 billion last year in expanding existing operations and developing new mines in B.C. Exploration and mine development investments are both key indicators of mining's future.

"This year's figures are representative of the increased drilling and sampling that is required to find and build tomorrow's mines for the benefit of all British Columbians." Gavin Dirom, president and chief executive of the Association for Mineral Exploration British Columbia, said in a statement.

"Perhaps the greatest indicator of mining's excellent health is the development of new mines," Hawes said. "These figures suggest a very bright future for mining, and the provincial government will continue to provide an attractive investment climate to attract new mine development."

Hawes currently serves as Parliamentary Secretary for Natural Resource Operations Review to the Minister of Forests, Lands and Natural Resource Operations in the provincial government.

Along with the construction and mine development under way at Copper Mountain, New Afton and Mount Milligan mines in 2010, there also were major mine expansions at the Endako, Gibraltar, Highland Valley Copper and Wolverine mines.

Historic BC land-use pact

The outlook for mining in British Columbia is even brighter in the wake of several recent actions by the BC and federal governments.

British Columbia Premier Christy Clark and Taku River Tlingit First Nation spokesperson John Ward July 19 signed a land and resource management and shared decision-making agreement, a pact that creates 13 new protected areas in the Atlin Taku region of northwestern B.C., while providing resource development opportunities and investment certainty in more than 3 million hectares (about 11,500 square miles).

"This balanced approach means a brighter future for families in the Northwest and opens the territory for business, bringing new jobs and opportunities, while protecting key environmental and cultural values," Clark said.

The agreement, developed collaboratively by the Taku River Tlingit First Nation and the provincial government, is the first of its kind in British Columbia. It gives formal effect to the Atlin Taku Land Use Plan and establishes government-to-government decision making structures and processes, to guide future land and resource management, engaging the community of Atlin and a cross-section of environmental and industry stakeholders.

"The Taku River Tlingits have looked forward to this day for a very long time," said Ward. "I wish to congratulate and thank the members of my First Nation for their hard work and dedication in bringing our 'Tlatsini Vision' to life in government-to-government agreements, which will protect our lands and Tlingit Khustiyxh, our way of life and help make our dreams of a prosperous and sustainable future a reality."

From 2000 to 2004, the Taku River Tlingit and B.C. were involved in litigation at the Supreme Court of Canada.

"This agreement represents a clear shift from conflict to collaboration between B.C. and the Taku River Tlingit First Nation," Clark said.

The resulting land-use plan resolves long-standing access, protection and mineral development issues in the Taku watershed, and provides clarity with respect to the values and objectives to be considered in resource management decision making.

Some 26.2 percent of the land use plan area considered of exceptional conservation value and strong Aboriginal and community interest are recommended for protection. This includes the mainstream of the Taku River and a significant proportion of its major tributaries, the Nakina, Inklin and Sheslay.

The British Columbia government said prohibiting commercial forestry in a large proportion of the plan area conserves critical caribou habitat. Salmon habitat conservation measures in the Taku watershed support its continued role as a salmon stronghold for both the western Canadian province and Alaska.

While setting aside areas for conservation, the land-use-plan leaves some 90 percent of the areas of highest mineral potential available for exploration and potential development.

The Taku River Tlingit have already begun to work co-operatively with mining developers in the area on potential resource development projects. It's expected that future resource extraction projects could support 350 jobs during construction and 280 operations jobs.

Commenting on the historic and unique agreement, AME BC Chairwoman Mona Forster July 19 said, "While AME BC recognizes that 90 percent of high-value mineral areas are open to exploration, the organization remains concerned that the designation of more than 26 percent of the total land area in protected areas and more than 15 percent in area-specific resource management zones is excessively high when compared to other land-use plans in British Columbia and represents a potentially significant lost opportunity to all citizens.

"It is not yet clear that access is definitely permitted through some newly designated areas, nonetheless, we are optimistic that the mineral exploration and development sector will be able to work with the Taku River Tlingit and the community of Atlin to ensure that exploration and development projects move forward in a positive way and will bring long-term economic opportunities and benefits to the local region and to all British Columbians," Forster added.

The region left open to mineral development includes the Tulsequah Chief mine site, a precious metals-rich volcanic massive sulfide deposit on British Columbia's western border, about 40 miles, or 64 kilometers, northeast of Juneau, Alaska.

Chieftain Metals Inc., a junior mining company that recently took ownership of Tulsequah, said its first priority at the project is to install a plant to treat the acidic metal-laden water flowing from historic copper-gold-silver-zinc-lead mines on the property, which have been sitting idle since it was shut down in 1957.

The acid rock drainage, which is believed to be reaching a tributary of the Taku River, has been a concern for regulators in both Alaska and British Columbia.

Environment Canada is requiring the installation of the water treatment plant as part of the conditions of Chieftain taking ownership of the property.

The other big hurdle for Chieftain is transportation to the project. The company is currently considering a year-round road from Atlin, a route that the Taku River Tlingit First Nations previously opposed.

The Taku River Tlingit's and Chieftain are in discussions to come to agreement on access.

Federal mining incentives, assistance

In June the Canadian government extended the 15 percent Mineral Exploration Tax Credit to March 31, 2012. This tax credit helps companies raise capital by providing an incentive to individuals who invest in flow-through shares issued to finance mineral exploration in Canada. The federal government also reiterated its commitment to work with the Red Tape Reduction Commission to reduce complex and overlapping regulatory requirements.

The federal budget did not specifically address new funding for geosciences research that would facilitate mineral exploration as well as the critical assessment and management of geohazards, such as earthquake and landslide risks. However, it did allocate $25 million over five years to the Targeted Geoscience Initiative and $1.8 million for advanced applied physics solutions that will enable remote high-precision mineral exploration of dense ore deposits.

"BC-based mineral explorers and developers appreciate the key measures that were announced in (the) federal budget. Maintaining the Mineral Exploration Tax Credit and reducing red tape will help sustain Canada's mineral exploration and mining sector, encourage capital investment and ultimately benefit all Canadians well into the future," said Dirom.

In a statement, the AME BC commended the government's commitment to supporting aboriginal skills development. The B.C. Aboriginal Mine Training Association, supported by the federal government, has led to the employment of 149 people. In total, there are 600 people now enrolled in this program, an indication that British Columbia's aboriginal peoples will have an increased role in the sustainability of B.C. and Canada's mining industry.

Power line for Northwest BC

In early May, the Northwest Power Line Coalition also won federal environmental approval of the proposed Northwest Transmission Line project. Federal approval supports the decision taken by the BC Environmental Assessment Office to grant BC Hydro an environmental assessment certificate for the proposed C$404 million, 344-kilometre transmission line project from the existing Skeena substation south of Terrace to a new substation near Bob Quinn Lake along Highway 37 in northwest British Columbia.

The Northwest Transmission Line is a fundamental infrastructure project expected to further stimulate mine development and exploration in the highly prospective Golden Triangle region of Northwest British Columbia. There are more than 935 mineral occurrences identified in the region that could benefit from the transmission line, of which 67 have been documented in the resource category.

In 2010, the provincial government identified 25 major exploration projects and proposed mine development in the corridor, and a 2008 study identified C$15 billion in investment and 10,700 potential jobs resulting from the power line.