Government must improve policy environment to unleash Saskatchewan’s mining potential
Commodity prices are boosting the economy in Saskatchewan, the province with the fastest projected economic growth in 2023. Indeed, Saskatchewan is poised to play a crucial role in global energy security due to the soaring demand for potash, uranium, helium and lithium.
Mining investors are taking notice, and according to recent data, Saskatchewan ranks among the top 10 most attractive jurisdictions worldwide for mining investment. However, while the province's strong geology contributes to its appeal, according to investors, its policy landscape is preventing Saskatchewan from reaching its full potential.
According to the latest survey of investors published by the Fraser Institute, Saskatchewan is the third-most attractive jurisdiction for mining investment (out of 62 jurisdictions), following Nevada and Western Australia. The survey measures the investment attractiveness of mining jurisdictions worldwide by surveying senior executives in the mining industry and tracking their perception of both policy environment and mineral potential.
Saskatchewan is home to 25 mines that produce 23 of the 31 minerals listed on the Canadian critical minerals list. These mining activities generate more than $19.4 billion in mineral sales and provide income for more than 7,000 Saskatchewanians.
When focusing solely on this mineral potential, Saskatchewan ranks as the second-most attractive jurisdiction globally. Indeed, the province possesses critical minerals (lithium, cobalt, copper, nickel, zinc) and rare earth elements (cerium, lanthanum, praseodymium and neodymium) essential for the production of batteries, electric vehicles, solar panels, wind turbines and more. Already the world's largest producer of potash, recent uranium discoveries further enhance Saskatchewan's appeal as an investment destination.
In large part due to this mineral potential, Saskatchewan's mining industry has played an increasingly significant role in the provincial economy, attracting substantial interest from investors since 2019.
But again, despite these positive recent developments and Saskatchewan’s impressive mineral potential, according to investors, government policies are prohibiting Saskatchewan’s mining industry from reaching its full potential.
When evaluating policy factors alone, Saskatchewan only ranks 15th out of 62 jurisdictions. This marks the first time since 2014 that the province falls outside the top 10 jurisdictions for policy.
The percentage of survey respondents expressing concern about the province's infrastructure increased from 15 per cent in 2021 to 29 per cent in 2022, nearly doubling the negative perception within this category. Similarly, concerns about socioeconomic agreements rose from 19 per cent of respondents in 2021 to 31 per cent in 2022. And the percentage of respondents worried about Saskatchewan's labour regulations also doubled, from 9 per cent in 2021 to 18 per cent in 2022.
Other areas continue to hinder the province's policy perception. For instance, 47 per cent of respondents identified uncertainty regarding protected areas as a significant deterrent to investment while 41 per cent identified uncertainty concerning disputed land claims to be a hindrance to investment. And 35 per cent indicated that uncertainty surrounding environmental regulations was a deterrent to invest.
Saskatchewan's mining industry is a crucial sector for the province's economy, holding immense potential for the future. To fully unleash this potential, however, policymakers must create a competitive policy environment to attract investment.