NWT: two private organizations disagree on the royalty regime


NWT: two private organizations disagree on royalty regime

The Diavik Diamond Mine in the Northwest Territories. The territory is in the process of reviewing its royalty regime.

As the Government of the Northwest Territories considers revising its mining royalty regime, the NWT and Nunavut Chamber of Mines and the group Alternatives Nord oppose on what should change in the new version.

On Wednesday, the Chamber sent an open letter to the Minister of Industry, Tourism and Investments, Caroline Wawzonek, expressing its disagreement with Alternatives Nord which distributed documentation to citizens claiming that residents do not get a fair share of mining profits.

The Northwest Territories royalty regime is currently under review and members of the public have until Friday 5 p.m. to provide feedback to the government.

The Alternatives North paper proposes that the NWT government increase royalties in larger increments than the current 1%. He also says the cap, which is currently 14% of profits, should be higher.

Royalties are a percentage of a company's profits that are shared between the federal government, which gets the largest share, Indigenous governments and the territorial government. The latter places part of it in his heritage fund, money reserved for future generations.

According to Karen Hamre, a volunteer with Alternatives Nord who wrote the The group's submission to the government, royalties are important because they help compensate future generations for not choosing renewable resources.

She claims that her organization distributed her document in order to encourage people to give their opinion on the revision of the royalty regime.

Karen Hamre, a volunteer with Alternatives North in Yellowknife, wrote a brief with 13 royalty recommendations to the territorial government.

The Chamber of Mines argues that this document is based on no facts.

The social justice group is not known for advancing ideas that could help boost mining investment in the Northwest Territories, may -we read in their open letter.

We know it, because this is what the Chamber works on every day of the year and Alternatives Nord has never told us helped.

Since 2014, diamond production has reached $11 billion in the territory and of that sum, royalties amounted to $250 million. In the past seven years, the territory has collected an average of 90 million royalties per year.

Tom Hoefer, CEO of the NWT and Nunavut Chamber of Mines, explains that the mining industry is not healthy in the territories right now and that raising royalties is not the silver bullet for this kind of change.

We all know that the mines are coming of age and the outlook will be pretty bleak in about three years from [the diamond mine's] closure. ] Diavik.

Tom Hoefer, director of the NWT and Nunavut Chamber of Mines says the mining industry needs support that raising royalties would be a mistake.

“The sector needs help, and government and industry work together to try to make things better.

—Tom Hoefer, Executive Director of the NWT & Nunavut Chamber of Mines

According to Hoefer, since the industry takes on most of the risk in mining, it deserves to receive a bigger share of the rewards. He believes increased royalties would deter companies from building mines in the Northwest Territories.

While Karen Hamre acknowledges that miners take risks, she think the public takes it too.

We are at risk that the companies withdraw without cleaning up or that the jobs are not suitable, and all of many things, she notes.

According to a spokesperson from the Ministry of Industry, Tourism and Investment, the comments received on the review will allow the government to develop policy options. These will be used to formulate recommendations which will then be submitted to a third party responsible for evaluating them.

The royalty regulations will then be incorporated into the broader process of developing all Mineral Resources Act regulations. A public consultation of all proposed regulations is expected to take place in spring 2023.

With information from Natalie Pressman


Please enter your comment!
Please enter your name here