Mineral Exploration in BC: Opportunities and Challenges

Dan M. Jepsen, RPFPresident & CEO

Association for Mineral Exploration BC

Canadian Diamond Drilling Association

Thursday, May 29, 2008

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About AME BC

“AME BC promotes a healthy, sustainable and environmentally sound mineral exploration and mining sector in British Columbia

for its members.”

Established in 1912 in Vancouver, BC 4,660 individual & 340 corporate membersHosts Mineral Exploration Roundup – over 6,700 registrants in 2008

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• 28,000 employed in BC

•$101,900/year wages and benefits

• $7 billion+ industry

• 25 major projects under review

BC Mineral Exploration and Mining Highlights

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•BC companies raise over 50% of global mineral exploration financing

•Over 850 companies call Vancouver home

•Over 700 BC consultants and suppliers

•Mineral ores and products account for 50% of Vancouver port traffic

Mineral Exploration and Mining Highlights

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BC’s Competitive Advantage

Proven mineral potential - great geology Expertise in geosciences, exploration & mine development

Rail, road & port infrastructure

Skilled workforce Low cost power

Competitive tax structure and incentives

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Provincial government support

Mineral Titles Online – state of the art mineral tenure acquisition

Publicly available geoscience data

Trade Missions

7Data Courtesy: BC Ministry of Energy, Mines and Petroleum Resources

Exploration Expenditures in BC

8Data: BC Ministry of Energy, Mines and Petroleum Resources, Natural Resources Canada

Mineral Exploration Drilling in BC

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BC's Percentage of Canadian Exploration Expenditures

Data Courtesy: Natural Resources Canada

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Mineral Tenure Acquisition in BCData Courtesy: BC Ministry of Energy, Mines and Petroleum Resources

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Commodity Prices (US$)

2001 2008* % increase

Gold (oz.) $263 $899 242%

Silver (oz.) $4.07 $17.47 329%

Copper (lb.) $0.75 $3.74 399%

Molybdenum (lb.) $1.75 $33.12 1793%

Zinc (lb.) $0.42 $0.94 124%

*Prices as of May 28, 2008

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Fraser Institute Survey: Policy Potential Index

2007/08 (19/68)2005/06 (23/64)

2004/05 (44/64)

2003/04 (45/53)

2002/03 (44/47)

2006/07 (30/65)

2001/02 (45/45)

Top “5” Issues

1. Mine Permitting - Major Projects Management Office

2. Mineral Reserves/Geoscience

3. Aboriginal and Community Engagement: Social Licence

4. Land Access and Mineral Tenure

5. Labour Shortage/Education and Training

6. Infrastructure

7. Climate Change Initiative

Mine Permitting

• Number of projects under consideration (both EA and provincial mine permitting):

2001: 12008: 25

• Major projects management office to streamline environmental review process

Tulsequah

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• Hit 25 year low in 2004 in Canada; rebounded slightly in 2005/06

• Current discoveries unlikely to meet global demand for metals (esp. in China, India)

Mineral ReservesCanada (1980=100) – adapted from NRCan

Geoscience

• BC government has committed $37 million toward Geoscience BC since 2005

Geoscience

• BC Geological Survey

• Geological Survey of Canada

• Federal commitments for data to lead tonew discoveries

(Targeted Geoscience Initiative)

Treaty Glacier

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Aboriginal and Community Benefits/Social Licence

• Partnerships are key

• Engagement and cross-cultural understanding critical

• Provincial resource revenue sharing model needed

• Government commitment to consult ($30M) welcome

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AME BC Initiatives

• Cultural Awareness Workshops

• ACE Guidebook

• Stepping Stone newsletter

• 10 Principles for Sustainable Relationships between the Mineral Sector & Indigenous Peoples

• Community Visits

Kutcho

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Land Access and Mineral Tenure

•Access to land a key issue throughout BC – 2-Zone Model

•Land use plans continue to erode land base

•First Nations land title issues – Duty to Consult and Accommodate

• Mineral Tenure Act amendments threat to certainty; working with government to best approach this

Labour Shortage

• Up to 100,000 workers needed over the next 10 years throughout Canada

• 40% of personnel across Canada plan to retire within 10 years

•Majority of workers in BC over 45 years old (52%)• Average planned retirement age: 60• 85% male; 4% Aboriginal• 7,500 workers in next 5 years

Infrastructure

• Working with industry and governments on Northwest Transmission Line

• Kemess Power Line

• Worked with Water Highway BC to secure Hydrometric funding

Health and Safety Initiatives

Safety Guidelines for Mineral Exploration in Western Canada

Annual Report in conjunction with PDAC

Health and Safety Awards

Exploration Field Safety Awareness Workshops

Safety stickers and cards

Summary

• Commodity prices, improved regulatory environment have made BC a preferred destination for mineral exploration and mining

• Key challenges remain in mineral reserves; geoscience; Aboriginal and community benefits; land access; and labour shortage

• Opportunities exist to address these challenges so that all British Columbians can benefit

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Thank you!

For additional information related to AME BC’s activities and to inquire about corporate membership contact:

Association for Mineral Exploration BCSuite 800 – 889 West Pender StreetVancouver, BC V6C 3B2

Tel: (604) 689-5271Fax: (604) 681-2363Web: www.amebc.ca