Mining Prospects

Trends and Developments in Mining Law in Canada and Internationally

Mineral Royalties: When Do They “Run With the Land”?

Posted in Mining
Junior Sirivar

The challenging commodity price environment will likely bring renewed focus on the rights and obligations that will be impacted if insolvency overtakes exploration and production companies. The British Columbia Supreme Court’s recent decision in Re: Walter Energy Canada Holdings, Inc. is a case in point. The case dealt squarely with the question of whether a mineral royalty “runs with the land” – a question that takes on significantly greater importance in the insolvency context. Continue Reading

Millions Invested and Nothing to Show for It – That’s Just the Nature of Option Agreements

Posted in Mining
Andrew Kalamut

Overview

The Ontario Court of Appeal in 798839 Ontario Limited v. Platt, 2016 ONCA 488, recently affirmed a trial judge’s decision that saw an optionholder that invested millions into the development of mining claims be left with zero interest in those claims.  The optionholder failed to meet all of the necessary preconditions to be able to exercise its option, and was left without any interest to show for it.  What seems like an unjust outcome is just the nature of options, according to the Court of Appeal. Continue Reading

Araya v. Nevsun Resources Ltd., 2016 BCSC 1856: British Columbia Supreme Court refuses to strike civil claims alleging human rights violations at Eritrean mine

Posted in Class Actions, Litigation, Mining
Robyn GiffordMiranda Lam

In an important decision for Canadian resource companies operating abroad, the British Columbia Supreme Court has permitted claims alleging human rights abuses at a mine in East Africa to proceed to trial. Continue Reading

Back on the International Stage – Spotlight on Climate Change Policy, the Paris Agreement, and Carbon Pricing Mechanisms

Posted in Climate Change
Selina Lee-Andersen

Over the years, climate change policy has experienced its ebbs and flows. Climate change landed on the international stage at the Rio Earth Summit in 1992, where 154 countries signed the United Nations Framework Convention on Climate Change (UNFCCC) to stabilize atmospheric concentrations of greenhouse gas (GHG) emissions at a level to prevent “dangerous anthropogenic interference with the climate system.” The UNFCCC came into force on March 21, 1994 and, to date, has been ratified by 195 countries. Subsequent international negotiations led to the Kyoto Protocol, an international treaty which extends the UNFCCC and commits its signatories to reduce GHG emissions. The Kyoto Protocol was adopted in December 1997 and came into force on February 16, 2005. There are currently 192 signatories to the Kyoto Protocol. While Canada withdrew from the Kyoto Protocol effective December 2012, a newly elected federal government has indicated its willingness to re-engage in international eff orts to implement a new global climate change treaty for the post-Kyoto era.

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The Changing Regulatory Landscape for Canadian-Owned Extraction Companies Operating Abroad

Posted in Mining
Andrew Kalamut

Canada is often considered to be the mining capital of the world. More than three-quarters of the world’s mining and exploration companies are based in Canada. Canada’s extractive sector typically amounts to more than one-third of the total value of Canadian domestic exports, and its natural resource sector directly and indirectly accounts for almost one-fifth of the country’s nominal GDP and 1.8 million jobs.

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Legislative Developments in Québec: An Act respecting transparency measures in the mining, oil and gas industries and changes to the Mining Act

Posted in Mining
Martin Thiboutot

In 2015, the government of Québec introduced legislative changes that have a direct impact on the mining industry. In October, An Act respecting transparency measures in the mining, oil and gas industries came into force (Act). By the end of the year, significant changes had also been introduced to the province’s Mining Act. Each of these legislative developments is described below.

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The United Nations Declaration on the Rights of Indigenous Peoples and Free, Prior and Informed Consent – Where does Canada go from here?

Posted in Aboriginal and Environmental Issues, Environmental Issues, Mining
Stephanie AxmannBryn Gray

In 2015, Canada’s new federal government committed to implementing the United Nations Declaration on the Rights of Indigenous Peoples (Declaration). This has generated significant attention in the mining and natural resource sectors due to the Declaration’s potential incompatibility with Canada’s constitutional and legal framework for Aboriginal rights and consultation, particularly the potentially broad interpretation of “free, prior and informed consent” (FPIC) as a veto right against resource development and administrative and legislative decision-making. While FPIC is a potential game changer, ultimately its impact in Canada will depend on how it is interpreted.

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Québec Budget 2016-2017 Announces Amendments to the Mining Tax Act and to the Refundable Tax Credit for Resources

Posted in Mining, Tax
Ryan RabinovitchAngelo DiscepolaAndrew Haikal

A number of mining-related (and largely taxpayer-friendly) amendments were introduced by the Québec Government as part of its 2016-2017 Budget. The purpose of this article is to provide an overview of these amendments and their expected impact on companies engaged in mining activities in Québec.
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50/50 JVs – Paved with Good Intentions

Posted in Dispute Resolution, M&A, Mining
Adam WankeRoger Taplin

One of the most difficult things to plan for effectively in any joint venture is conflict resolution and decision deadlock between the joint venture partners.  Joint venture agreements in the mining industry can be voluminous documents.  Pages are devoted to calculating partner dilution, setting out partner rights, outlining how and by whom JV operations will be managed.  At the same time, little thought is often given to how the partners will deal with a deadlock over an operational decision.

In a way it is not surprising that mechanics dealing with decision deadlock can be an afterthought – most CEOs want to plan for success.  However, spending some time thinking about how a JV partner can break a deadlock long before a deadlock occurs is a wise investment; this especially rings true in the case of a 50/50 JV where no single party will be able to make any decision, major or minor, without the agreement of its JV partner.

This article outlines some of the mechanics we have seen used in 50/50 JVs by companies in the mining industry to resolve a deadlock or to solve a dispute.  While it is often the case that parties in 50/50 JVs will spend more time thinking of solutions to deadlock than those in non 50/50 JVs, the concepts described below can be applied in almost any type of JV.

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Sign of the Times: 177 Nations (and counting) Ink the Paris Climate Agreement while the World Bank and IMF Push for Carbon Pricing

Posted in Environmental Issues
Selina Lee-Andersen

The following post by Selina Lee-Andersen on our Canadian ERA Perspectives blog may be of interest to readers of this blog:  Sign of the Times: 177 Nations (and counting) Ink the Paris Climate Agreement while the World Bank and IMF Push for Carbon Pricing

Earth Day 2016 – April 22nd – marked the opening of the Paris Agreement for signature at the United Nations (UN) Headquarters in New York. The Paris Agreement, which was adopted by the parties to the United Nations Framework Convention on Climate Change (UNFCCC) on December 12, 2015, will remain open for signature until April 21, 2017.