Yukon is a territory located in the northwest of Canada, bordered by the Northwest Territories to the east, British Columbia to the south, the U.S. state of Alaska to the west and the Beaufort Sea to the north. It is one of the smallest provinces or territories in Canada by both size of population and land area. As a territory, Yukon’s government has not always had the same authority as the Canadian provinces, though a gradual process of devolution has been underway since the 1960’s. In 2002, the Yukon Act was passed, granting the territory the right to administer its natural resources, shifting the authority from the federal government.
Yukon has the second smallest economy by GDP in Canada, with public administration (23.9%); real estate (14.4%); construction (12.9%); health care and social assistance (9.1%); mining, quarrying and oil and gas (5.7%); and retail trade (5.5%), amongst the major industry contributors (Yukon Bureau of Statistics, 2018).
Yukon’s natural resources include gold, copper, zinc, lead, silver, uranium and nickel. According to the Yukon government, the territory is home to one of the world’s largest iron ore deposits. That being said, the territory’s mining industry has suffered in recent years, with a 32.1% decrease in GDP contribution between 2017-2018. Whilst exploration spend looked to be on the rise in 2017, reports from the Yukon government in 2019 suggested that spend had decreased by almost 50% from 2018. However, due to the opening of several gold mines in 2018-2019 and the potential for a new copper mine to be approved in the near future, economic forecasting for the territory’s mining industry going forward looks to be positive.
PRINCIPAL LEGISLATION AND REGULATOR
As noted above, since the passing of the Yukon Act, the regulation of the mining industry in Yukon is primarily the territorial government’s responsibility. The primary mining laws in Yukon are the Quartz Mining Act (QMA), which regulates hard rock exploration and mining; the Quartz Mining Land Use Regulation (QMLUR); Placer Mining Act (PMA), which regulates gold exploration and mining; the Quartz Mining Royalty Regulation (QMRR), which provides taxation terms for the industry; and the Yukon Surface Rights Board Act. There are also several relevant environmental statutes and regulations that affect mineral exploration and mining in Yukon including: the Yukon Environmental and Socio-economic Assessment Act (YESAA) and its accompanying regulations; the Waters Act; the Regulations and the Territorial Lands (Yukon) Act; and the Environment Act. In addition, the Government of Yukon has published several guidance documents providing information on the licensing process and other topics relevant to mineral extraction.
Yukon’s Department of Energy, Mines and Resources (EMR) is responsible for managing the territory’s natural resource development. This department is led by the Minister of Energy, Mines and Resources (Minister). Under the terms of the QMA, powers are also given to the Commissioner of Yukon (Commissioner); mining recorders and inspectors; and the Chief of Mining Land Use (Chief) (see ss. 2(2) and 144-145, QMA). The Yukon Environmental and Socio-economic Assessment Board (YESAB), established pursuant to the YESAA, also plays a vital role in the licensing process - assessing exploration and licensing applications and making recommendations to the EMR.
GRANTS AND FORMS OF MINERAL TITLE
In Yukon, anyone over the age of 18 may “enter, locate, prospect, and mine for minerals” (s.12, QMA). Section 12, QMA also states that a qualified individual has the right to carry out such activities on: any vacant territorial lands and any lands in respect of which the right to enter, prospect, and mine for minerals is under the administration and control of the Commissioner.
The QMA provides for the following mineral rights:
Mineral Claim (Claim): A Claim is the first and most basic right. The holder is entitled to all minerals covered under the QMA that “lie within the boundaries of their claim continued vertically downwards” (s.50, QMA). A Claim is valid for one year, renewable on a year to year basis, subject to the holder meeting certain conditions (s.56(1), QMA). To make a Claim, a prescribed fee must be paid to the Mining Recorder to acquire claim tags and the area must be marked with two legal posts at “each extremity of the location line” (s.23, QMA). Once marked, an additional fee must be paid and the Claim recorded (s.41(1), QMA). In order to maintain a Claim, the holder must perform work on the land or make a payment in lieu of work (ss. 56 and 61, QMA). Note that in order to carry out exploration activities, the approval of an Exploration Programme is required (s. 132, QMA).
Quartz Lease (Lease): A Lease provides a more secure form of mineral tenure than a Claim. Claim holders are entitled to a Lease upon the granting and recording of a Certificate of Improvement, subject to the payment of prescribed fees (s.74, QMA). In order to obtain a Certificate of Improvement, the Mining Recorder must be satisfied that the criteria set out under section 70, QMA have been met. Some notable criteria include the need for a Claim to have been worked or payment in lieu of work made and for a vein or lode to have been found within the limits of a Claim. Leases are valid for an initial 21-year term, renewable for additional 21-years terms subject to the terms of section 103, QMA.
In addition to these forms of mineral tenure, those wishing to carry out exploration activities must also provide notification of, or obtain approval for, an Exploration Programme or, for development and production activities, obtain a Mining Licence (Licence) (see ss. 129 et. seq., QMA).
Exploration Programme: Approval of an Exploration Programme is required if a project proponent intends to disturb the land in a way outlined by the QMA and its regulations (ss.131 and 132, QMA). Programmes are classified based on the scale and size of the project, with classes ranging from 1 – 4. For classes of exploration 2-4, an assessment by the YESAB will be required. The government has outlined some general requirements for Exploration Programmes in the form of minimum performance expectations in the QMLUR (Schedule 1).
In addition to minimum performance expectations, each class of Exploration Programme also has its own set of content requirements and approval processes.
Class 1 Programmes
Class 1 Programmes may last up to 12 months. Proponents interested in engaging in a Class 1 Exploration Programme must provide a Notification to the government. The Notification has an extensive list of required information including:
- Applicant’s details (contact information, etc.)
- Claim status report
- Map indicating camp location, work locations, and all proposed access locations
- Start and end dates for the project
- List of equipment and/or machinery to be used
- Details of activities (structures, fuel storage, stripping, drilling, trenching, etc.)
- Mitigation measures to reduce environmental and socio-economic impacts
The government will consult with affected First Nations but there will be no YESAA assessment required. Approval is at the discretion of the Chief. Class 1 Programmes will be subject to random inspections to ensure compliance with operating conditions.
Class 2 Programmes
As with Class 1 Programmes, Class 2 Programmes may last up to 12 months. Proponents interested in engaging in a Class 2 Exploration Programme must contact the Chief with their Notification application and necessary fees (see Schedule 2, QMLUR). The Class 2 Notification will require the following information:
- Applicant’s details (name, contact information, etc.)
- Details on the proposed Exploration Programme (location, size of camp, types of structures, usage of explosives, etc.)
- Operating procedures being followed to mitigate adverse environmental effects of activities being undertaken
The Chief retains discretion to have an applicant resubmit as a Class 3 or 4 programme application if there are special public concerns. Class 2 Programmes are also subject to environmental assessment pursuant to YESAA (see Environmental Overview Commentary). Once the YESAA assessment is complete, EMR will issue a Decision Document accepting or rejecting the proposal. If the government has added additional terms, the applicant must accept these terms and update them in the Class 2 Notification. Once the Notification is finalised and submitted, the Chief will approve or reject the proposed project. This decision will turn on “whether the exploration program as described in the Notification will appropriately mitigate any adverse effects” (s. 8(1.1)(c), QMLUR).
Class 3 and 4 Programmes
Class 3 and 4 Programmes may last up to ten years. In addition to filing fees (Schedule 2, QMLUR), an Operating Plan/Application must be submitted with all Class 3 and 4 Programmes (s.9(1), QMLUR). This Operating Plan must be approved prior to the commencement of work. The Operating Plan will require some of the following details:
- Applicant’s contact information
- Location of operation
- Operation workplan (including a chronological plan outlining all proposed activities and the dates of all work expected to be completed)
- Description of the area (including labelled photographs, description of wildlife, vegetation, physiography and the geology of the area)
- Description of all known waste materials in the area
- Description of project activities (list of all equipment to be used, new/existing access routes, proximity to water, exploration drilling and trenching)
- Measures to be taken to minimize negative effects of exploration and site preparation
- Location of camp facilities
- Waste management plan
- Details of any discussions with First Nations and other stakeholders
A YESAA assessment will take place in addition to the application submitted to EMR. If the YESAA assessment is supportive of the Operating Plan, a Decision Document will be issued by the EMR accepting, rejecting or varying the YESAA recommendations. In issuing the Decision Document, the EMR will have to consider “scientific information, traditional knowledge and other information that is provided with the recommendation” (s.74(1), YESAA). In reaching a decision on the project, the Chief will apply the following test for approval - “whether the exploration program as described in the Operating Plan will appropriately mitigate any adverse effects” (s.9(2)(c), QMLUR). If YESAA recommendations and the Operating Plan are approved, the project may proceed. If exploration is expected to last longer than one year, an annual pre-season report – outlining the anticipated work for the upcoming year – will need to be submitted.
Quartz Mining Licence (Licence): Yukon’s legislation does not outline in great detail what needs to be included in a Licence application. The legislation states only that an application is required, and the Minister has the discretion to require a public consultation prior to issuing a Licence (s.135, QMA). The QMA also provides discretion to make regulations regarding licensing, but it does not appear that any have been made (s.135(5), QMA).
The most reliable information available on the process comes from the Quartz Mining Licence Application Guide (QMLAG). The applicant must start by submitting a Letter of Intent requesting a Licence. The application itself is divided into two parts – Mine Development and Mine Construction.
Mine Development requires submission of two plans – a Reclamation and Closure Plan and a General Site Plan. The Reclamation and Closure Plan should contain information addressing how to minimise the likelihood of adverse environmental impacts. The General Site Plan should describe the objectives, plans and activities to be undertaken. Applicants should be prepared to provide information on any of the following that are relevant:
- Transportation infrastructure (e.g. transportation requirements during site development including plans for upgrading or building roads)
- Site layout and infrastructure construction (including a description of mine and camp set-up and fuel storage)
- Environmental management plan (e.g. sediment and erosion control, environmental monitoring plan, emergency response plan, wildlife protection)
- Plan addressing how to deal with protection of heritage resources
- Worker’s health and safety plan
The Mine Construction portion of the application requires an explanation of the mining components to be used – more specifically, construction and operation plans relating to the type of mining proposed. These plans will vary depending on whether the project involves open pit or underground mining, for example. In any case, applicants should be prepared to provide some or all of the following information:
- Planned mining approach
- Pre-construction plans and drawings
- Details on the equipment to be used
- Organizational and management structure
- Work schedule
- Development plans
- Description of extraction method
- Environmental protection plan
If the EMR approves the proposed plan, it is likely a Licence will be issued and mine construction may begin. It is important to remember that these details are not outlined in the legislation but rather the government’s Licence Guide from 2010. It is critical for any project proponents to contact EMR for more up to date information on the approval process for Licences.
Financially, it is relevant to consider that security may be required when applying for an Exploration Programme or a Licence when “there is a risk of significant adverse environmental effect” (s.139(1), QMA).
Aboriginal treaty rights play a significant role in any land use or development in Canada. Specifically, Section 35 of Canada’s Constitution Act sets out the significance of treaty rights in the country. Section 130, QMA explicitly acknowledges the need to act in accordance with such Constitutional obligations. The screening process provided for under the YESSA explicitly requires consultations with affected First Nations throughout the life of the project. This screening process applies for all Licences and Exploration Programmes classified at levels 2 through 4.
A surface lease or land use permit may also be required to access a Mineral Claim. The QMA addresses surface rights on vacant territorial land (lands under the control of the Commissioner) in Section 79 and outlines that the Minster may grant the holder of a Claim the surface rights at a rate of one dollar per acre. The lease length cannot be longer than the duration of the underlying Lease. If the surface rights are held by someone other than the Commissioner, Claim holders will have to reach an agreement regarding access with the lawful owner or occupier (see ss. 17 & 108, QMA). Disputes may be heard by the Yukon Surface Rights Board, pursuant to the Yukon Surface Rights Board Act.