This week there was, on the surface at least, exciting news report by CTV that a Memorandum of Understanding (MOU) has been signed between the Government of Canada and Mercedes Benz as well as Volkswagen to “secure access to Canadian raw materials for batteries in electric vehicles.”
As a Member of Parliament with active mining operations in my riding, I can state firsthand on the significant importance of well-paying jobs as well as the considerable spin off economic benefits not just to the local community but the entire region.
It is also worth noting that, while Canada currently does not have an active lithium mining and processing industry, we are ranked number six for having the world’s largest lithium reserves behind countries such as Chile, Australia, Argentina, China and the United States.
For those of you unfamiliar with lithium, it is a highly reactive metal that is used in rechargeable batteries for electric vehicles and other electronic products such as laptops and cell phones, as well as a growing list of other consumer goods.
As the world increasingly relies on electric battery powered vehicles and devices, this will result in increased lithium demand.
With this announcement I also have some concerns.
As many in the mining industry will know, back in 2014, Ottawa rejected the New Prosperity Mine that would have been located west of Williams Lake.
In August of 2021 Ottawa again rejected another mine, the proposed “Grassy Mountain” mine, that would have been located in the southwest of Alberta.
Both rejections occurred under different federal governments, but for the same reason, due to potential adverse impacts on the local environment.
Since the Trudeau Liberal Government has come to power, they have also expanded the scope of impact assessment to include considerations such as “Gender-based Analysis Plus” to the scope of criteria that must be met.
For some context there is a 16-page federal document to explain how this impact assessment process is intended to function.
Aside from these types of regulatory requirements and environmental concerns, proponents must also consult with local Indigenous communities.
However, if a local Indigenous community is strongly in support of a project, Ottawa may still reject the proposal for other reasons.
On a related note, a recent C.D. Howe Institute Report found that “business investment in Canada is about half what it is in the United States and is lower than in other OECD nations”.
One of the stated reasons for our declining investment and productivity is related to “regulatory uncertainty” here in Canada.
There is a growing list of projects that have been cancelled in Canada, not just for environmental reasons, but also for political reasons.
I mention this because if there is to be a sudden “boom” in new lithium mines, it raises the question where does the Federal Government prefer these mines are located?
There is also the question of water use, as it has been reported that the production of lithium through evaporation ponds uses a lot of water. Approximately 2.2 million litres of water is needed to produce one ton of lithium.
During the 2019 election the Trudeau Government had promised to create a new water regulator and has been dropping hints that it will be proceeding with such an agency.
It isn't known whether its mandate will inevitably conflict and act as another potential hurdle for new mines to navigate.
Likewise, given the uncertainty of our current regulatory process, what changes is the Federal Government prepared to make that will accelerate the approval process of new lithium mines?
Currently the Trudeau Liberal Government has been silent on these details.
My question this week:
What are your thoughts on the future of lithium mining here in Canada?
I can be reached at Dan.Albas@parl.gc.ca or call toll free 1-800-665-8711.
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Dan Albas is the Member of Parliament for the riding of Central Okanagan-Similkameen-Nicola.