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Minister Eyre sees bright future for Saskatchewan's Mining Industry

Potash has played a leading role for 60 years in our economy, so it’s obviously a key economic sector.
potash mine
Saskatchewan Mining and Minerals is planning to begin construction late this year on a $200 million sulfate of potash upgrade in Chaplin, at its facility there.
MOOSOMIN - The World-Spectator spoke with Saskatchewan Minister of Energy and Resources Bronwyn Eyre, about the future of the mining industry in Saskatchewan. The full interview follows:

How important is the potash industry specifically to Saskatchewan and how do you see that level of importance changing over the next decade?
I think it’s very important and there are significant opportunities ahead for growth in potash and there are some other projects out there, particularly on the solution side and some new technologies that will be used for certain mines moving forward.

Potash has played a leading role for 60 years in our economy, so it’s obviously a key economic sector. The latest numbers the sector had sales valued at $5.5 billion in 2020, it directly employed about 6,000 workers, it was 10 per cent of Saskatchewan’s GDP. We have a 10 year growth plan, we target achieving about $9 billion in annual potash sales by 2030 and we think that’s achievable. It’s something that can be buttressed by the commitment from Mosaic, from Nutrien, from K+S who are our existing potash producers, and of course the recent decision by BHP for the $12 billion Jansen project.

In recent years, there has been some major investments in potash and BHP announced that massive investment at Jansen this year.
How do you see the expansion of the potash industry playing out in Saskatchewan?
BHP was a great start in terms of signals of future growth. BHP invested $5 billion, and plans to invest an additional $7.5 billion in that mine. It is the largest private investment ever in Saskatchewan history, and the biggest project ever by BHP. There are amazing job numbers, 3,500 at peak during construction, over 600 permanently once it’s up and running.

I mentioned the growth plan, certainly that will contribute to achieving our goal of $9 billion of potash sales by 2030. Jansen is going to generate tens of billions of dollars in royalties and taxes to the people of this province over the life of the mine. I think it is a very strong sign of the attractiveness of the investment climate that we have put in place in the province. We had $20 billion dollars invested into projects over the last six years that’s now $30 billion with this BHP announcement.

We hope this sends a very strong signal to other companies and there are other projects that are on the horizon, perhaps not on the Jansen scale but still on the horizon. We hope that they take notice of this globally significant project in the province.

How do you expect potash production to grow in the province in the coming years?
We have a growth plan that is estimating $9 billion of potash sales by 2030 and the long term prospects going forward are very positive. Population growth, the growing levels of income around the world, the increased consumption of bio-fuels, all of these things point to an increasing need for more potash globally for decades to come.

That really is the fertilizer side of the food, fuel, and fertilizer that we export around the world. Going forward, I think the numbers that we are estimating can be fulfilled in the growth plan are really borne out by the investments that we have seen, most recently by BHP.

Aside from the other projects in the in the works and on the drawing board, do you see potential for even more investments in potash mining in the province?
Yes we do, perhaps not on the scale of BHP Jansen, but certainly there are other potential projects that are under development and could come to fruition, perhaps on the solution side. Certainly there is room for investment and that’s why we have the growth plan target that we have, because we have created an investment climate for the province that will bring some of those projects over the line.

What has the government done to ensure that Saskatchewan remains a competitive jurisdiction as potash mining companies look to future investments?
We have implemented a number of incentives in the potash taxation system since 2003 and that of course is the government of Saskatchewan before even we came into government. This has improved the environment for potash investment and these measures have played a really important role in attracting the $30 billon of investment that I referenced. That’s while making sure people in the province get a fair return for the potash resource.

We remain very committed to looking at growth, looking at competitiveness as we go forward and as other projects perhaps move forward. Last year we announced amendments to the Potash Production Tax to improve accessibility of credit for market development and R&D. These changes are all about expanding the potash sector and making sure the province remains the preferred jurisdiction for private companies to pilot innovative technologies.

What do you see as the main challenges and the biggest opportunities for Saskatchewan’s potash industry?
We’ve been really successful in exporting ‘made in Saskatchewan’ products to markets all around the world, but there are challenges when it comes to competing globally. For one, around Environmental Social Governance (ESG). We have a very strong sustainability brand here in Saskatchewan. Our potash production produces 50 per cent fewer emissions in production than competing jurisdictions around the world. It’s very clean, it’s very green, it’s very innovative. Yet when you’re competing internationally with companies in other parts of the world—Belarus or Russia just to name two—you have very different labor laws, you have very different environmental regulations—they aren’t as stringent and at the high standard that they are here in the province of Saskatchewan. That can be of some frustration to companies where they are facing global competition.

The other answer to that is we continue to tell the Saskatchewan story and we continue to tell the sustainability story, and how made in Canada, made in Saskatchewan potash is produced at the highest level of ESG components. We try to get the word out as much as possible and we think we are well placed to do that with some of the investment we’ve attracted. We have very transparent regulations and royalty systems, taxation systems, that make it a very attractive jurisdiction compared to competing jurisdictions around the world and he have to keep getting the word out about how sustainability we produce here in the province of Saskatchewan.

Lithium and Helium are two elements that have some potential for development in Saskatchewan—how much potential do you see for these elements and what other elements do you see becoming a factor in Saskatchewan over the next decade?
It’s very exciting in terms of both of them, Helium and Lithium. In terms of Helium—made in Saskatchewan Helium—of course we are now the home to the largest purification facility in the province and we have a lot to tell about Helium in Saskatchewan. For example, it’s not extracted as a byproduct generally of hydrocarbon production so we can have dedicated Helium wells, and we have very good reserves of it. We’ve done extensive geological surveying and we fully expect that we can make up 10 per cent of global Helium supply here in Saskatchewan by 2030. It’s very exciting and a lot more is to come in that area.

In terms of Lithium, we have a company here called Prairie Lithium and their technology is extracting Lithium from oil well brine. I always like to say what a beautiful irony it is that oil well brine is going to lead to the powering of electric vehicles, so that is something we are certainly interested in promoting and looking further into, that is something companies are looking further into. So that I would say is something to watch for sure.”

In terms of employment and in terms of contribution to the province’s GDP, where do you see Saskatchewan’s mining industry a decade from now compared to the current figures?
Well in 2020 this past year, just keep in mind that the mining sector was responsible for 12 per cent of provincial GDP, directly employed about 14,000 people and indirectly supports thousands more. Again, we have highlighted very ambitious targets in the growth plan to increase the size and the sustainability of the sector.

In addition to BHP for example, Mosaic has accelerated work on the Esterhazy K3 project—that’s a multi-billion dollar project.

Saskatchewan Mining and Minerals is planning to begin construction late this year on a $200 million sulfate of potash upgrade in Chaplin, at its facility there.

We have a very promising future in terms of advance stage Uranium projects—NextGen Energy, Denison Mines, Fission Uranium.

We have so much going on in terms of critical minerals that are being developed in commodities that may be slightly less traditional to Saskatchewan, in addition to potash and Uranium. We’ve got Foran Mining and its McIlvenna Bay project that would be the world’s first carbon neutral copper development.

We’ve had a bit of a gold rush over the last year in the mining space and we’ve got advanced spaced exploration and evaluation of the Fort à la Corne Diamond project as well, they work as you know with Rio Tinto. There’s a lot in the base and precious metal state, a lot going forward in the areas such as copper and diamonds and gold. Uranium is looking very bright, obviously the prices are doing well there at the moment. So there’s a lot of activity, and around our target and mineral exploration incentive, that focused on base and precious metals in the Creighton and Denare Beach area which is very rich for those. That’s also been very successful, that targeted exploration incentive for juniors in particular, who we were concerned might bypass the province and perhaps explore in other provinces.

It’s proven very successful in attracting those juniors and keeping them drilling here. I think we’ve had quite a successful year in that area.