- Ottawa is ramping up tax credits, infrastructure funding, and other policy tools to attract investment into extraction and critical minerals.
- A B.C. review finds many EA-approved mines are delayed or never built, with economics (prices, financing, engineering) cited more often than regulation.
- Industry disputes that conclusion, arguing permitting beyond EA adds long timelines, cost, and uncertainty that deters capital.
- The policy push versus perceived regulatory burden creates investor risk around project viability, timelines, and Canada’s competitiveness.
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In recent policy pronouncements, the Canadian government has doubled down on supporting its extraction sector—particularly for critical minerals—through fiscal stimulus (e.g. tax credits, infrastructure funds), sovereign investment, and regulatory reforms. Key moves include extending the 15% Mineral Exploration Tax Credit (METC) until March 31, 2027, launching or expanding funds like the Critical Minerals Infrastructure Fund and a newly announced Critical Minerals Sovereign Fund, reforms to tax regimes favoring a broader set of critical minerals, and efforts to align federal and provincial regulatory process timelines.
At the same time, independent research (notably the BC study published in FACETS) indicates that while many mining projects in B.C. awarded environmental assessment (EA) certificates have either not opened or were delayed, the predominant factors are economic (commodity price volatility, financing, project engineering challenges), not regulatory or permitting delays. In fact, of 27 EA-approved projects, only three of the 20 delayed cited regulatory obstacles.[0.0]
Nevertheless, industry stakeholders contest these conclusions. They highlight that data are limited, that EA is only one piece of the regulatory puzzle, and that substantial layers of provincial and federal permitting beyond EA (e.g. water, land use, Indigenous consultations) impose costs, delays, and uncertainties. Particular concern centers on the issuance of “notice of work” permits and the time it takes for projects to move from exploration to production.[0.0]
The result is a tension between the government’s ambition to accelerate Canada’s role in global supply chains for critical minerals, emphasizing competitiveness and investment attraction, and the extraction sector’s perception that regulatory unpredictability undermines that ambition. Strategic implications follow: capital may flow more readily to jurisdictions with clearer, faster approval paths; speculative upstream exploration projects may be deferred; ander trade risks (from U.S. tariffs or allied expectations) can magnify exposure.
Open questions remain around the transparency and accountability of projected economic benefits (output, employment, tax revenue), given frequent underperformance relative to forecast in EA disclosures; the precise impact of recent regulatory reforms on real timelines; how Indigenous consultation, environmental standards, and litigation fit into any timeline acceleration; and whether the government’s funding instruments will sufficiently mitigate risks tied to financing and commodity cycles.
Supporting Notes
- The 15% Mineral Exploration Tax Credit (METC) has been extended to March 31, 2027, delivering an estimated C$110 million to exploration investment.
- The Critical Minerals Infrastructure Fund was originally launched in 2023; its second Call for Proposals in 2025 makes available over C$500 million for clean energy and transport infrastructure tied to critical mineral production.
- Budget 2025 includes a C$2 billion Critical Minerals Sovereign Fund and a C$371.8 million First and Last Mile Fund to strengthen upstream and midstream segments.
- Federal proposal lowers eligibility thresholds for the Clean Technology Manufacturing Investment Tax Credit: reducing the minimum percentage of qualifying mineral content from 90% to 50%; also adds minerals such as antimony, indium, gallium, germanium, and scandium.
- Audit of British Columbia mines (27 EA certificates since 1995) found 13 had never operated; of the 14 that did, only 7 opened on time; regulation was cited as a cause of delay in only three projects.[0.0]
- The same BC audit found mines producing just ~23% of projected output, ~12% of projected employment, and nearly 100% under-delivery in expected tax revenue.[0.0]
- Industry groups (MABC, AME) argue that permitting delays impact projects collectively worth C$38 billion; average wait time for exploration permits in BC is around 140 days—much longer in many cases.[0.0][0.0]