Covid-19 and Mining in Ontario: Issues and Impacts

May 6, 2020

What has been the impact of Covid-19 on communities, workers and mining operations in Ontario? What are governments doing about it? It is still early days in the pandemic and information about impacts at (and from) specific mining operation is hard to get. This review will piece together what we know to date from publicly available documents.

What is the risk from Covid-19 to mining workers and communities in Ontario?

The spread of Covid-19 in northern Ontario may just have started. At the start of May, there are 76 cases in the Thunder Bay District Health Unit, 61 in Porcupine District Health Unit and 57 in Sudbury District. By April 20, 14 have been identified in northern First Nations.

Mine and exploration sites are often remote, and require transportation in planes, car pools and buses to get there. The workers are often in confined spaces for meals, accommodation and bathing. Much of the workforce is transient and contracted out, returning home to communities where they may spread the virus.

The skilled workforce and management rarely live in the community where the mine is located, and rely on travel by air to work. They are often also global travelers during their vacations.

Almost all protocols at mines are based on identifying carriers through symptoms like fever, when in fact, it is now believed that the virus can be transmitted before any symptoms show. When a worker does get sick, isolating them safely may be very difficult, and getting treatment even more so.

Many northern communities near mines are impoverished and several pre-existing conditions that put people at serious risk are common: cardiovascular disease, asthma, diabetes and tuberculosis.  Access to clean water and sanitation is likely to be in short supply. Homes are over-crowded. Health resources are very limited, as is testing.

In a statement issued on April 15, Matawa Chiefs said: “an effective on-reserve containment plan faces numerous barriers that are beyond their control, including:

  • inadequate supplies of personal protective equipment
  • unequal distribution of PPE supplies
  • lack of COVID-19 testing kits
  • unclear protocols on how/where tests are analysed, and who is responsible for contact tracing when a positive case is confirmed
  • inadequate internet service to access telehealth and to connect to information, support and learning resources
  • ongoing boil water advisories
  • overcrowded housing and lack of infrastructure for effective self-isolating
  • ongoing opioid crisis
  • acute medical conditions among a large segment of the population
  • lack of primary health care services (access is affected by self-imposed community lockdowns)

The Chiefs said they are concerned that staff and volunteers supporting COVID-19 responses in their communities will suffer burn-out before the first wave of the pandemic ends this summer.[i]

As the Matawa Chiefs say, the toll on governance resources from dealing with the pandemic in these under-resourced communities is frightening. As a result, Northern Ontario First Nations want the province to put a hold on mining exploration permits and pause the operation of a system that allows for the remote staking of mining claims while they deal with the coronavirus pandemic. 

Neskantaga Chief Chris Moonias said all the band resources of his community of 300 people, which sits about 400 kilometres north of Thunder Bay, are stretched thin on COVID-19 prevention and preparation work. “Right now we are in the middle of a pandemic and pretty much my staff is all hands on deck dealing with this,” said Moonias. 

“We don’t have the tools, the resources to look at permits. We are not like the government that has many different departments.[ii]

How many mines are there in Ontario?

Annually, the Ontario Prospectors Association produces the Ontario Mining and Exploration Directory.[iii] The 2020 directory was published at the end of February.

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There are 31 metal mines operating in Ontario, 20 of them gold mines, as well as nine industrial mineral mines (salt, gypsum, talc, etc.). The directory provides a list of the operating mines, information and contact numbers for exploration companies and projects, as well as key suppliers.

Most of the base metal mines are located in the Sudbury area. The Ferromin Iron Mine is near Madoc and the Kidd Creek lead-zinc mine is near Timmins. All the gold mines are in Northern Ontario, many of them located on the traditional territories of First Nations. There are also two nickel and copper smelters in Sudbury. Cameco (a uranium producer in Saskatchewan, has refineries in Port Hope and Blind River.

What are Ontario mining operations doing about Covid-19?

On April 27, the Mining Association of Canada released “Pandemic Action Summaries” about the measures being taken by their members to protect workers and communities from Covid-19. Eight of their 43 member companies reported on their operations in Ontario, as follows:

Barrick Gold Hemlo Operations: Still operating, with enhanced safety measures (meeting Ontario guidelines). These include: social distancing (i.e., no more than 6 workers in the cage at one time), staggered shift implementation to reduce crowding in meeting rooms, at security, etc., and work at home for non-essential staff where possible. They also said that they were: “Partnering with our First Nations Rightsholders communities to aid them in the lock down of their communities to ensure they are not vulnerable during this time by allowing workers to self-isolate for 14 days’, and by reducing travel.[iv]

Cameco: The Blind River Refinery has been placed on care and maintenance and the UF6 plant in Port Hope was shut down for most of April. Cameco says it has been having trouble getting workers to operate the facilities.[v]

De Beers Canada: The Victor Mine was already closed last year. In Ontario, the company donated $50,000 over four different communities in Ontario and the North West Territories. Timmins’ Living Space Hub and Women in Crisis were  among the grant recipients.

Glencore, Sudbury Integrated Nickel Operations: Still operating with enhanced safety. Partnering with Med-I-Wall Services to provide a Covid-19 fact sheet and do online coaching for workers and their families. $50,000 was also donated to the Sudbury Food Bank[vi]

New Gold, Rainy River. Production at the mine was on hold for two weeks in late March but ramped up again after May 3 using workers from the local area.[viii] Fly-in/Fly-out operations have been greatly reduced.[ix] New Gold said the majority of its staff, about 70 per cent, live in the mine’s immediate area, and its close proximity to the United States means staff often go across the border (which they can no longer do easily).

Newmont, Musselwhite Mine. The company reported that it stopped production on March 23, limiting personnel to care and maintenance activities. A donation of $200, 000 was set aside to help community efforts in their partner First Nations ($170,000 for transport and food, $30, 000 to the Thunder Bay Community Relief Fund). At their Porcupine project, $100,000 was donated to the Cochrane District Social Service Administration Board and $50,000 to the Town of Chapleau.

Vale, Sudbury Operations. The mines and smelters are still operating, using thermal cameras to test for fever in workers. The company has donated $100,000 to the Sudbury Food Bank and has posted  a $1 million “Covid Challenge”: “to propel innovative COVID-19 solutions into the marketplace. The challenge is open in Canada and Brazil with each selected solution eligible to receive up to USD $200,000.

The Mining Association of Canada, the federal lobby for producing mines, says on its website that  “18 national and regional industry associations and partners came together to donate a total of $36,000 to the Ottawa Food Bank, Food Banks Canada, and to food banks across the country.”

There are also number of mining companies operating in Ontario that do not belong to the Mining Association of Canada.

Among these is Impala Canada’s Lac De Iles platinum mine which operated until April 13, despite a major outbreak of Covid-19 beginning in late March. By April 27, 25 workers had tested positive for the virus and one worker had died.[x] The company had planned to reopen at the end of April, but has now postponed these plans indefinitely. The platinum mine is on the territory of Kiashke Zaaging Anishnaabek (Gull Bay First Nation), a community of 300 people, which now has seven confirmed cases and are awaiting the results of 27 further tests. The Chief Wilfred King believes the outbreak stemmed from the mine. “Why the Ford government would allow the mine site to operate as an essential service. I can’t understand that. I can’t see how platinum and palladium is essential,” he said in a CBC interview on April 24, 2020.  Greg Rickford, Minister of Energy, Mines and Northern Development and Indigenous Affairs says that the province is providing immediate support “to support capacity needs”.

At Kirkland Lake Gold’s Detour Lake mine[xi] – the largest gold mine in Canada – one worker tested positive in early April. The company was already having trouble at its Holt, Holt Mill and Macassa Mines, as many of the workers were from Quebec and were affected by the provincial border closure, so these mines were temporarily shuttered. Their Holloway Mine went on care and maintenance in early March for other reasons. At Detour Lake, work continues at about 30% capacity, using local labour.

Kinross Gold has no mines in Ontario, but had to shut its head office in Toronto after one of its employees tested positive for the virus.

What about exploration companies?

The first weekend in March, the Prospectors and Developers Association of Canada (PDAC) held their annual conference in Toronto. Attended by over 23,000 people from all over the world, including a number of representatives from indigenous governments in Ontario, at least three participants tested positive after they returned home. One was an employee of the Ontario Ministry of Energy, Mines and Northern Development;[xii] another worked for Troilus Gold in Quebec and the third was the Minister of Mines in Burkina Faso.[xiii] Burkina Faso is now facing one of the worst Covid-19 outbreaks in Africa.

In Ontario in 2018 there were approximately 150 mineral exploration companies with over 200 projects and $580 million in expenditures. These companies are having trouble accessing their properties because of community concerns, lack of transportation options and access to sufficient capital. [xiv]I was unable to find any information on safety measures taken by individual exploration companies. Most of them will not be eligible for government subsidy programs, because they have no revenues except investments.

What is the role of the Ontario Government?

Ontario is doing everything it can to protect the mining industry, as the list below illustrates:

  • On March 17,2020, Ontario passed an Emergency Declaration under Section 7.701 (1) of the Emergency Management and Civil Protection Act. This gave the provincial government power to make a number of changes favouring the mining industry.
  • On March 20, all limitation periods for hearings before the Environmental Review Tribunal were suspended and hearings under the Ontario Water Resources Act and Environmental Protection Act were adjourned to at least May 29 (Regulation 73/20)
  • On March 23, Ontario released its list of essential services, and included mining. Ontario’s definition of “essential” is broad, including “businesses that ensure global continuity of supply of mining materials and products (e.g. metals such as copper, nickel and gold) and that support supply chains in northern Ontario including:
    • Mining operations, production and processing;
    • Mineral exploration and development; and
    • Mining supply and services that support supply chains in the mining industry including maintenance of operations, health and safety.
  • On April 3, the Environmental Bill of Rights was suspended (temporary regulation 115/20). This exempted proposals for changes to policies, acts, regulations and instruments from public notice, consultation or input until 30 days after the Emergency Declaration comes to an end.
  • Also on April 3, the requirement that proposals submit a Statement of Environmental Values was removed.
  • The requirement to complete work on claims within a year in order to maintain the mineral tenure has also been extended, but requires an application by the claim holder.
  • Ontario has also passed requirements for enhanced safety measures at worksites and in the community to halt the spread of COVID-19.  
  • The government is proposing a temporary increase to the Employer Health Tax (EHT) exemption from $490,000 to $1 million for 2020. This will exempt most mining companies altogether.
  • Working in conjunction with the government of Ontario, the Workplace Safety and Insurance Board (WSIB) will allow employers to defer payments for a period of six months.[xv]
  • It appears that mine inspections during the pandemic are not being done in person but by phone and video communication with  mine management, and that no orders to rectify problems are being issued. On April 23, the United Steelworkers sent a letter to the Ontario Minister of Labour decrying this practice saying it put workers at risk.[xvi]
  • It should be noted that Ontario also exempts corporate lobbyists from reporting on their activity if they have received a written invitation to provide comment from the government.[xvii]

What is the role of the federal government?

From the industry point of view the most significant is theCanada Emergency Wage Subsidy (CEWS). On March 30, Canada announced that it would subsidize a company for 75% of an employee’s salary up to a maximum of $58,700 to prevent layoffs, back dated to March 15.[xviii]

The Mining Association of Canada was thrilled with this announcement and said that ““The support being offered through this new program will enable mining companies to retain their workforces in the face of significant economic hardship brought on by the COVID-19 pandemic….Over the past several weeks, MAC has worked closely with government decision makers from different departments to ensure the mining industry’s voice is being heard when economic recovery efforts are discussed. MAC will continue to engage with the government as the COVID-19 pandemic continues to unfold.”[xix]

There has been a less enthusiastic response from mining companies in northern Canada and from exploration companies, as the subsidy is contingent on showing that the company had losses based on either last year’s financial statements or on income in January and February 2020. Exploration companies never have income, and producing mines engage in a number of BEPS (Base Erosion and Profit Shifting) measures to avoid taxation, which is likely to affect their eligibility for CEWS.

Flow Through Shares (FTS) The major source of income for mining exploration companies, FTS usually requires exploration work to be completed within a year, or the exploration company become liable for the increased taxes that have to be paid by the investor. PDAC is lobbying very hard to get exemptions to this requirement. [xx]

Conclusions

There can be no doubt that the mining industry in Ontario is being dramatically affected by COVID-19 through loss of capital, disruption of their supply chains and markets, reduced workforce and loss of community support.  As a result, mining and exploration companies have multiplied their lobbying of governments to decrease regulation of their industry and to increase the extent of subsidy. They want to make us more dependent on extraction. In future, companies will also be increasingly automating the work at their mines and offices, eliminating the jobs that are currently unsafe.

What Covid-19 brings home is the folly of creating an economy dependent on mineral extraction. It is not sustainable. It is a waste management industry that depletes the very resource it depends on and externalizes its costs to land, waters and communities. Justifying the mining of gold as an “essential service” defies logic, when all the gold we could ever need can be found in our recycled cellphones. We need to put mining in its place, to develop just transition strategies for workers and communities and to respect the true cost of those minerals we take for granted.


[i]https://www.tbnewswatch.com/local-news/matawa-first-nations-express-frustration-over-covid-19-response-2256590

[ii https://www.cbc.ca/news/indigenous/first-nations-mining-permits-ontario-covid19-1.5550033

[iii]https://www.oma.on.ca/en/ontariomining/resources/2020-Ontario-Mining-Explorion-Directory.pdf

[iv] Pandemic Action Response, page 17

[v] Ibid, page 28

[vi] Ibid

[vii] Ibid, page 44

[viii] https://www.newgold.com/investors/news-releases/news-details/2020/New-Gold-Announces-Restart-of-the-Rainy-River-Mine/default.aspx, and https://www.newgold.com/covid-19/Rainy-River-Mine/

[ix] Ibid, page 54

[x] https://www.northernontariobusiness.com/industry-news/mining/covid-19-claims-life-of-lac-des-iles-worker-2284925

[xi] https://www.miningmagazine.com/covid-19/news/1384318/kirklands-holt-macassa-kicked-to-lower-gear

[xii] https://www.pdac.ca/convention/attendee-info/health-and-safety/coronavirus

[xiii] https://www.halifaxexaminer.ca/featured/the-possible-horrible-legacy-of-the-coronavirus-convention/

[xiv] https://www.osler.com/en/resources/regulations/2020/covid-19-s-impact-on-mining

[xv] https://budget.ontario.ca/2020/marchupdate/action-plan.html

[xvi] https://www.usw.ca/news/media-centre/articles/2020/covid-19-health-safety-complaints-and-work-refusals-in-ontario

[xvii] https://www.nationalobserver.com/2020/05/01/news/ontario-allowing-secret-lobbying-amid-covid-19-critic

[xviii] https://www.canada.ca/en/department-finance/economic-response-plan

[xix] https://mining.ca/press-releases/governments-wage-subsidy-to-bring-relief-to-canadas-mining-companies-and-their-workers-amid-covid-19-pandemic/

[xx] https://www.osler.com/en/resources/regulations/2020/covid-19-s-impact-on-mining