Ontario (FREE SAMPLE)
Legislation
- Mining Act 1990 (and accompanying regulations)
- Mining Tax Act 1990
- Environmental Assessment Act 1990
- Far North Act 2010
Regulatory Risk Rating
Regulatory Risk
Regulatory Corruption Risk
Regulatory Corruption Risk
Corruption Exposure Risk
Corruption Exposure Risk
| Regulatory Risk Rating Factors | Risk Level |
|---|---|
| First Come / First Serve | Very Low |
| Application Criteria | Moderate |
| Duration | Very Low |
| Right to Renew | Very Low |
| Competing Licences | Very Low |
| Mineral Coverage | Very Low |
| Right to Mine | Very Low |
| Criteria for Mining Rights | Very Low |
| Tenure | Very Low |
| Surface Rights | Very Low |
| Government Take | Very Low |
| Transfer Rights | Critical |
| Change of Control | Very Low |
| EIA Process | Moderate |
| Power to Revoke | Moderate |
| Age of Legislation | Very Low |
| Other Factors | Low |
From a legal risk perspective, Ontario represents a high-water mark in the regulation of mining; by no means is it perfect, but the province has crafted a set of rules over decades of experience that strike a balance among prospectors, junior and major mining companies, investors and government, as well as the community at large. Fundamental to the law is its security of tenure - if one proceeds in an orderly manner, one will (eventually) acquire and protect mining rights.
Contents
Legislation
- Mining Act 1990 (and accompanying regulations)
- Mining Tax Act 1990
- Environmental Assessment Act 1990
- Far North Act 2010
Regulatory Risk Rating
Regulatory Risk
Regulatory Corruption Risk
Regulatory Corruption Risk
Corruption Exposure Risk
Corruption Exposure Risk
| Regulatory Risk Rating Factors | Risk Level |
|---|---|
| First Come / First Serve | Very Low |
| Application Criteria | Moderate |
| Duration | Very Low |
| Right to Renew | Very Low |
| Competing Licences | Very Low |
| Mineral Coverage | Very Low |
| Right to Mine | Very Low |
| Criteria for Mining Rights | Very Low |
| Tenure | Very Low |
| Surface Rights | Very Low |
| Government Take | Very Low |
| Transfer Rights | Critical |
| Change of Control | Very Low |
| EIA Process | Moderate |
| Power to Revoke | Moderate |
| Age of Legislation | Very Low |
| Other Factors | Low |
Overview
Canada is one of the largest mining nations in the world and the minerals industry is a major part of the country’s economy, According to Natural Resources Canada, in 2018 the mining industry directly contributed some $72.4 billion to GDP, with indirect impacts adding a further $25.4 billion and mineral exports accounting for almost 20% of all domestic exports. Ontario is the leading mining province in Canada and is responsible for around 22% of all mineral production value. The province is the largest producer in the country of gold, platinum group metals and nickels, and the second largest copper producer (Ontario Mining Association). The province also produces diamonds, cobalt, zinc and silver. Major mining companies including Glencore and Vale have long established operations in the province. Ontario also attracts a large portion of exploration spend – with almost $600 million spent in 2018.
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Regulatory Risk Ratings & Full Analysis
Regulatory Bodies
Under the Canadian Constitution, the regulation of mining activities and mineral rights in the Canadian provinces is the responsibility of the provincial governments. In Ontario, the primary administrative body is the Ministry of Energy, Northern Development and Mines (MENDM), specifically the Mines and Minerals Division (MMD). The Ministry is headed by the Minister of Energy, Northern Development and Mines (Minister) who is the ultimate authority regarding the administration of the primary mining laws and regulations. The Minister is responsible for appointing Provincial Mining Recorders (PMR), who play a key role in the licensing process for exploration and development.
From an environmental perspective, the Ministry of Environment, Conservation and Parks (Environment Ministry), headed by a Minister of the same title (Environment Minister), administers the main environmental laws and is responsible for the approval of projects and the issuance of the various environmental permissions required under the legal framework. That being said, the MENDM is responsible for the Class Environmental Assessment (Class EA) and is the primary authority for activities which fall within this class, though it works closely with the Environment Ministry on such matters.
Other important bodies of note include: the Ministry of Natural Resources and Forestry (MNRF) which is responsible for the protection of Ontario’s biodiversity and the promotion of economic opportunities in the resource sector; the Mining and Lands Tribunal (Tribunal) within the Ontario Lands Tribunals, which is responsible for hearing and deciding matters which arise in relation to the legislation overseen by both the MENDM and MNRF, including the resolution of mining and land disputes; and the Environmental Review Tribunal – also within the Ontario Lands Tribunal -, which holds hearings on appeals related to the various licences and permits provided for under a suite of environmentally focused legislation.
It should also be noted that in Canada, whilst environmental concerns are primarily the responsibility of the provinces, in cases that affect the federal jurisdiction, a project may be subject to federal level environmental legislation. Federal level assessments are led by the Impact Assessment of Canada (Agency) which is overseen by Environment and Climate Change Canada, headed by the Minister of Environment and Climate Change.
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Key Features and Development Considerations
Mining in Ontario is primarily regulated by the Mining Act 1990 (MA) and its accompanying regulations. Other relevant legislation includes the Far North Act 2010, the Mining Amendment Act 2009, the Aggregate Resources and Mining Modernisation Act 2017 and the Mining Tax Act 1990.
In Ontario, mineral rights are acquired and registered via the Mining Lands Administration System (MLAS) which was established in 2017, replacing the older system of map and ground staking. The MLAS is used for administering public lands for the purposes of mining and the administration of the registration of mineral tenure.
The following mineral titles are available:
- Prospecting Licence: Required in order to register a Mining Claim. Obtained via MLAS following the completion of a mining awareness programme. Initially granted for five years, with the ability to subsequently renew.
- Mining Claims: Registered via MLAS on land open to prospecting (any free cell on the provincial grid). Single application must cover no more than 50 contiguous cells. Applications for multiple cells must be registered separately and multi-cell applications may not be in respect of more than 25 contiguous cells. Minimum assessment work requirements apply. Surface and extraction rights are not covered by a Claim. Surface rights owners must be notified within 60 days of the registration of a Claim. May be transferred and sold without restriction unless an application for a Mining Lease has been made, in which case consent is required.
- Mining Lease: Granted to Claim holders who are in compliance with the MA. Grant the exclusive right to enter the land, search for and extract minerals. Option to lease the mining rights or make an application to also lease the surface rights to the land, where available. Renewable and transferable on application.
Other less common titles under the MA include licences of occupation and patented mining claims (involving acquisition of the freehold).
In terms of general development considerations, rights holders should be aware that leases granted under the MA are subject to certain reservations, including those relating to Aboriginal or treaty rights, which require leaseholders to conduct activities in a manner which is consistent with such rights. Requirements relating to compensation and surface rights are clearly stated under the law. Large portions of land in the Far North are reserved for environmental reasons and Claims may not be staked there. Where a new mine is set to be established on land in the Far North where mining is permitted, a community land-based plan will be required. Proponents in such areas should therefore make themselves aware of the consultation requirements under the FNA.
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EIA Process & Environmental Considerations
In Canada, environmental protection is primarily the responsibility of the provincial governments and various pieces of legislation are important to the regulation and management of the environment in Ontario, including the Environmental Assessment Act 1990 (EAA) and its accompanying regulations and the Far North Act 2010 (FNA), alongside various provisions of the MA. Meanwhile, the Environmental Protection Act 1990 (EPA) applies to mining operations in relation to areas such as pollution and waste management. Note that Ontario is currently in the process of modernising its environmental assessment programme and it is hoped that this update and review will reduce the timeline for project approval. Upon completion of the review, this commentary will be updated where necessary.
Under the provincial framework, the majority of mining projects will not be subject to an EA process (see ss. 3(b), 3(c) and 3.0.1, EAA). Private sector (mining and other) projects are not subject to the EAA, unless the project involves certain decisions by another ministry or agency, is designated as being subject to an EA by regulation or the proponent voluntarily agrees to the application of the law. That said, an EA for a mining project may be required where the project involves the construction of power or transportation facilities, or waste facilities, or a discretionary grant of land rights; note, however, that the acquisition of a Mining Claim or Mining Lease does not trigger an EA – since these grants are not discretionary under the Mining Act.
In practice proponents often voluntarily submit to the provincial EA process when subject to the federal Impact Assessment Act 2019 (IAA). Under the IAA, a mining project will be subject to an EA in the following circumstances:
- In the case of the construction, operation, decommissioning and abandonment of: a coal, diamond or metal mine (other than a rare earth element, placer or uranium mine) or metal mill (other than a uranium mill) which has a production capacity of 5000 t/day or more: a rare earth element mine with a production capacity of 2500 t/day or more; a stone quarry or sand or gravel pit with a production capacity of 3,500,000 t/year or more.
- In the case of the expansion of an existing mine, mill, quarry or sand or gravel pit where: for coal, diamond or metal mines (other than rare earth element, placer or uranium mines) and metal mills, the expansion would result in an increase in the area of mining operations by 50% or more and the total production capacity would be 5000 t/day or more; for a rare earth element mine, the expansion would result in an increase in the area of mining operations by 50% or more and the total production capacity would be 2500 t/day or more; for stone quarry or sand or gravel pits if the expansion would result in an increase in the area of mining operations by 50% or more and the total production capacity would be 3,500,000 or more.
- For uranium mines – the construction operation and decommissioning, outside the licensed boundaries of an existing or new mine or mill with an ore production capacity of 2500 t/day or more or the expansion of a mine if the area of mining operations increases by 50% or more and the production capacity is 2500 t/day or more.
- For oil sands – the construction, operation, decommissioning and abandonment of a new mine with a bitumen production capacity of 10,000m3/day or more or the expansion of an existing mine if the area of mining operations increases by 50% or more and the production capacity would be 10,000m3/day or more.
See the Physical Activities Regulations 2019 (Schedule 2, ss. 18-25)
For projects that are subject to an Ontario EA (voluntarily or otherwise), the process involves:
(1) The submission of Terms of Reference (TOR) to the Minister for approval (s. 6(1) EAA) and the provision of public notice so as to allow such parties to submit comments to the Environment Ministry (s. 6(3.1)-s. 6(3.6));
(2) The approval of TOR by the Environment Minister, along with amendments if deemed necessary, providing the Environment Minister is satisfied that an EA prepared in accordance with the TOR would be consistent with the EAA (s. 6(4) EAA);
(3) The submission of an EA in accordance with the approved TOR including:
- a description of the purpose of the undertaking;
- the rationale for the undertaking;
- the alternative methods for carrying out the undertaking;
- the alternatives to the undertaking;
- a description of the environment that will (or may) be affected;
- the effects that may be caused;
- the actions which may prevent, change, mitigate or remedy such effects for the undertaking;
- an evaluation of the advantages and disadvantages to the environment of the undertaking and of the alternatives to the undertaking; and
- a description of any consultation relating to the project and its results (ss. 6.1(1) and 6.1(2), EAA) or information in line with the approved TOR (s. 6.1(3), EAA).
The EA shall then be submitted to the Environment Minister for review (s. 6.2(1), EAA) and the proponent must again provide notice to the relevant parties so as to allow for comments (s. 6.3(1)-(4) and s. 6.4(1)-(2).
Following the review, the Environment Minister has several options: to refer the undertaking to mediation; to approve the undertaking (with the approval of the Cabinet); to approve the undertaking subject to certain conditions (with the approval of the Cabinet); to refer the undertaking to a tribunal for a decision; or to refuse the undertaking (s. 8 and s. 9 EAA).
Deadlines for each stage of the EA process are outlined in Regulation 616/98 and further guidance on the process is provided in the Code of Practice.
MNDM Class EA: The Class EA of the MNDM is limited in its application, applying to only two types of activities: discretionary tenure decisions of the MNDM and the MNDM administered mine rehabilitation activities and emergency remediation on Crown held sites. Thus, the request for Crown surface rights or discretionary mining rights (e.g., mining rights that have been withdrawn from staking) may trigger the requirement for an EA under these rules. Undertakings that fall within the remit of the MNDM’s Class EA are placed into a category based on their environmental impact and assessed following a specific EA process for that category. Detailed explanations of each process can be found within the MNDM Class EA guidelines.
Far North: The FNA provides for a joint planning process between the First Nations and the Ontario government in order to determine the most appropriate use of public land in the Far North region. According to the FNA, community-based land use plans are not necessary for prospecting, claim staking, mineral exploration or grants of leases or licences of occupation in accordance with the MA (s. 12(5)(e), FNA). However, a community land-based plan will be required for the opening of a new mine (s. 12(1), FNA). As such, mine developers within the Far North will need to consider the requirements of the legislation or seek an order from the Minister to undertake the development without a plan (s.12(2), FNA).
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Mining & Environmental Laws
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