Falling metal prices flatten Manitoba's mineral exploration industry
Mineral exploration in Manitoba's $2.5-billion mining industry is showing signs of a major slowdown as the worldwide economic crisis drives base metal prices lower.
Exploration activity in the province has dropped by as much as 60 per cent year over year — as prices for commodities such as nickel, copper and zinc have plummeted on world markets — say industry officials.
Snow Lake prospector Ken DeGraaf said that last year a spare drilling machine — used to search for precious metals — was hard to find. But times have changed.
"There's no problem getting a drill now," he said. "We basically have our pick. So when you start seeing availability of drills, you know things have slowed down."
Mike Muzylowski, CEO of Callinan Mines, which operates mines in Flin Flon, Man., and in the Thompson nickel belt, said the downturn in the industry has been sudden and dramatic.
It might be two years before the mineral exploration — an economic sector that's been hot in Manitoba in recent years — picks up pace again, he predicted.
The value of metallic and industrial mineral production in the province hit a record $2.5 billion in 2007, tripling in value since 2003.
According to Manitoba government statistics, mining firms in the province were expected to spend an estimated $116.9 million on new exploration in 2008.
Meantime, Muzylowski said at least half of those working in the industry — everyone from drillers to truckers — could soon face layoffs.
"There's a whole list of people who are reliant on that miner that breaks the first rock. For one miner it could be thousands of employees are reliant on him," he said.
Muzylowski worries many drillers and prospectors will choose another career path in that time, making it even more difficult for the industry to get back on its feet when normalcy returns.
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