Wanted: flow-through extension

Securities reform and the federal “super” flow-through share program were at the top of the agenda of the Prospectors & Developers Association of Canada, when it submitted its brief at the recent mines ministers conference in Halifax N.S.

The PDAC requested a 3-year extension of the “super” flow-through share program, which has been a lifeline for many PDAC member companies.

The brief to mines ministers points out that the program has encouraged significant and successful exploration during an exceptionally long downturn in the market cycle.

Between October 2000 and June 2003, flow-through share financings raised more than $450 million, and the resulting flow-through-related discoveries average two per month.

It has been more than a decade since Canada has experienced a similar flow-through discovery rate. In fact, a compilation of related statistics has revealed that jurisdictions that have maintained geoscience funding at levels endorsed by the mines ministers in 2001 are reaping the benefits of increased discoveries.

In its brief, the association reminded the federal, provincial and territorial ministers that securities reform is an issue of longstanding importance to junior exploration companies.

Noting the several submissions it has made to the various groups considering securities reform, the PDAC said it supports one set of rules, applied consistently across Canada by a single regulator. The association also sought assistance in meeting the costs of community consultation.

The brief says that such consultation, particularly with aboriginal groups, can be a significant expense for mine exploration companies. Therefore, the PDAC asked to have such expenditures made eligible for Canadian Exploration Expense tax credits.

In addition, the brief says, when a consultation process results in material delays to assessment work programs, mineral rights may be jeopardized. Ministerial discretion may be needed to grant extensions to complete assessment work. The brief also points out that in some jurisdictions, clarification of legislation may be required.

Finally, the brief addressed the portability of professional qualifications. It says that progress is being made between professional self-regulatory organizations and professional associations on issues related to interjurisdictional incidental practice and mobility. The PDAC is asking the ministers to encourage and support efforts to facilitate professional practice across Canada.

A full copy of the brief is on view at www.pdac.ca

— The preceding is an excerpt from PDAC In Brief, a monthly publication of the Prospectors & Developers Association of Canada.