A low-carbon future means a big demand for key minerals. Can N.L.’s mines cash in?

As automakers unveil electric vehicle after electric vehicle, and innovation surges around solar panels and other renewable energies, an industry with a long history in Newfoundland and Labrador hopes to position itself to supply more of the materials needed for the green transition.

“It’s a very opportune time for the province. Mining is essential for a low-carbon future,” said Ed Moriarity, the executive director of Mining Industry NL, the province’s industry association.

Not every ore is created equal in the eyes of innovators, as demand focuses on extracting what are sometimes termed “critical minerals,” sometimes labelled “strategic” ones.

Exactly which minerals those are are subject to debate, with an ever-changing list of up to 30, but a few make the cut just about every time — including some well-known to Newfoundland and Labrador: nickel, cobalt, and rare earth elements.

For nickel and cobalt, both mined at Voisey’s Bay in Labrador, demand is expected to rise by 2050 by more than 1,000 per cent, said Moriarity.

“That’s a fundamental shift that we need to realize,” he said.

Batteries in electric cars need particular metals

Both metals are used in electric vehicle batteries. The raw elements are a hot commodity — the federal government has stated the battery industry is set to grow from $23 billion to $90 billion in the next decade — as EV adoption increases, boosted by pledges like the United Kingdom’s plan to ban new gas car sales by 2030.

No less than Tesla founder Elon Musk recently dangled the prospect of buying up more nickel, as long as mining companies can comply with his demands.

“Tesla will give you a giant contract for a long period of time, if you mine nickel efficiently and in an environmentally-sensitive way,” Musk told investors on a corporate update in July.

Tesla Motors CEO Elon Musk, seen here in 2015, has been vocal about his desire to snap up nickel, as long as it’s produced to standards he’s set. (AFP/Getty Images)

That’s good news for Voisey’s Bay, and its operator Vale, according to one mineral deposit expert.

“Some of the other kinds of nickel deposits in the world are really messy and pollute the environment quite a lot,” said Derek Wilton, an honorary research professor in Memorial University’s earth sciences department.

“So you find people like Elon Musk looking for ethical nickel — that’s what he calls it — for his batteries. I can’t think of a more ethical nickel deposits than the Voisey’s Bay itself,” he said, pointing to Vale’s environmental efforts as well as its operating agreements with the Inuit government in Nunatsiavut and the Innu Nation.

Vale expansion half complete

Well before Musk made noise about nickel, Vale clearly took notice of the global trends.

The mining giant announced in 2018 it would extend the life of its Labrador mine, a $2-billion expenditure to move operations underground. It was partly financed by pre-selling its cobalt supply — an amount Wilton calls “pretty significant” — before it’s even out of the ground.

While the pandemic threw a hiccup into that construction, its two underground mines are now 55 per cent complete, Vale says.  One is set to produce in the late spring of 2021, and the other in the summer of 2022.

“Things are really maturing and we’re on the cusp of the future of Voisey’s Bay,” Matthew Stewart, Vale’s mining expansion manager at the site, told the province’s annual mining conference Thursday, from a live feed 200 metres underground.

We’re seeing a bit of a renaissance, in terms of the attractiveness of the province.– Ed Moriarity

The mine’s operational costs will double once the expansion is complete, and its capital costs will quadruple, according to Vale. It’s an investment done in the hopes of a big payoff, and Wilton thinks there’s more hope — and along with that, more mining — to be had from other deposits in Labrador.

“I think there’s probably more around. This is going to take some or more exploration, but we’ve got a great potential,” Wilton said.

Where, exactly, that potential lies is “the $64,000 question,” Wilton said, as there are vast tracts of the Big Land that have remained untouched, unmapped and unknown.

The open pit mine at Voisey’s Bay, Labrador is set to be exhausted in 2022, just as its underground operations swing into gear. (Vale)

Exploration and competition

It could be a multi-million dollar question. 

Companies around the world are seeking out ore deposits, and jurisdictions are throwing out incentives to lure them in. Just across the Labrador border, Quebec’s provincial government has released a five-year, $90 million spending spree to develop its critical mineral sector and encourage companies to explore and invest.

A worker prepares to pour molten gold at the Anaconda mine in Baie Verte. Gold is credited with driving growth in N.L.’s mining sector. (Zach Goudie/CBC)

Newfoundland and Labrador punches above its weight on the Canadian mining scene, ranking fifth in the country for production, and mining activity overall in Newfoundland and Labrador has been rising, despite the pandemic, according to Mining Industry NL. 

Much of that has been fuelled by gold. Between 20 and 30 companies have come into the province in the last year or so, Moriarity said, and as exploration activity around that ore increases, so too does the province’s mining profile overall.

“We’re seeing a bit of a renaissance, in terms of the attractiveness of the province. It’s always had a solid reputation, And now the onus is on us as an industry and as a community to to build on that,” he said.

Much more mapping

Like Wilton, Moriarity says more minerals need to be mapped out to build outsiders’ interest.

He credits the province with providing a trove of data online, but “we need to build on that public geoscience work,” Moriarity told the mining conference this week.

Derek Wilton says Labrador’s rare earth element deposits are promising, as the minerals light up computer screens and will continue to be sought after in the future. (Eddy Kennedy/CBC)

Such mapping may be the first step, but mining developments don’t happen overnight.

Voisey’s Bay was discovered in 1993, and began producing 12 years later. There’s been excitement around rare earth elements in southern Labrador for several years, but the company doing exploration work hasn’t yet made the leap to commercial production.

“Those elements are used in our smartphones and in our TV screens and in our computer screens. I can’t imagine society today without them,” said Wilton.

Those deposits may yet see the light of day, depending on global markets. But amid that uncertainty, Wilton said there is reassurance to be taken from our rocks.

“We’ve got great geology,” said Wilton.

“Price and good geology are always going to determine whether you’re going to have a viable industry. And I think we’ve got great potential here.”

The company will pay $200 million over four years in compensation for the right to export an additional 94,000 tonnes of nickel concentrate from its mine on Labrador’s northern coast. 1:56

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