Mining innovation ecosystem needs dedicated federal funding to thrive, innovation groups say

Canada’s mining innovation organizations are stepping up their collaboration to better coordinate industry-led innovation and new technology commercialization. But the effort needs stronger federal policy and financial support, the groups say.

Some of the approximately 40 mining R&D organizations across the country are calling for a national mining innovation strategy, including a dedicated financial commitment from Ottawa.

The push to more effectively support and “de-fragment” Canada’s mining innovation ecosystem comes amid signs that the country’s global leadership in the mining sector is slipping.

READ MORE: By the Numbers: Reversing the decline in Canada’s mining sector through innovation

Many leaders in mining innovation agree on the need for long-term funding from Ottawa, targeted to support the sector's innovation activities.

"We need to have a strategic innovation fund dedicated to the mining sector," Francis Fournier, president and CEO of Quebec City-based COREM, told Research Money. COREM is Canada's largest centre of expertise and innovation in mineral processing.

“If you look at the [federal] investment in mining compared with other industries, it’s very small,” Carl Weatherell, executive director and CEO of the Ottawa-based Canadian Mining Innovation Council, said in an interview. “Manufacturing, forestry, aerospace and automotive have all had dedicated programs of investments of hundreds of millions or billions of dollars. And mining has not been there.” The Mining Association of Canada's report, The State of Canada’s Mining Industry 2019, also emphasized the point that “the minerals industry is notable by the lack of any substantial, strategic and long-term government investment in innovation."

Weatherell noted that one of several recommendations in Canada’s “Resources of the Future” Economic Strategy Table 2018 report was: “[Provide] multi-year, predictable, matching government funding to de-risk and leverage substantial direct private investment in resource innovations.” That hasn't happened.

“We live hand-to-mouth, as do all the other organizations,” said Jennifer Abols, president and CEO of MIRARCO in Sudbury. “If we had a more reliable, steady stream of funding, we could keep the [innovation] chain together and be a lot more innovative.” MIRARCO is a not-for-profit research arm of Laurentian University and offers expertise in rock mechanics, safety, software and energy.

Al Shpyth, executive director of Saskatoon-based International Minerals Innovation Institute (IMII), said there's a lack of recognition by government, banks and other institutions that Canada is fortunate to have one of the world's largest and most diverse endowments in metals and minerals. "This creates a barrier to targeted investment or strategic support for innovation in the mining sector." IMII, focused on Saskatchewan’s potash and uranium mining, builds capacity in both technology development and education and training.

A national innovation strategy, led by industry and co-developed with government, would recognize the sector's importance and could include much-needed higher levels of funding support for the mining sector's regional innovation clusters, Shpyth said.

Federal investment in mining compared with other sectors

The federal government since 2016 “has invested extensively in support of innovation in Canada’s mining industry,” including through the March 2019 Canadian Minerals and Metals Plan (CMMP), Austin Beaton, communications advisor for Natural Resources Canada (NRCan), said in an email to Research Money.

Ontario and Saskatchewan didn’t endorse the CMMP, saying it failed “to specifically address economic and competitiveness challenges and send a strong message to investors around the world that Canada is prepared to take real action to support our mining sector.”

Beaton noted that federal investment in the mining sector has included the $10-million Crush It! Challenge, launched by Impact Canada in 2018, to mobilize innovation solutions to improve energy use by at least 20% at Canadian mines.

In 2017, the government launched the $155-million Clean Growth Program, aimed at improving the environmental performance of Canada’s natural resource industries. Beaton said this program has committed:

• $5 million to help develop Canada’s first all-electric underground mine in Borden, Ontario;
• $2 million to support converting the industry’s largest diesel-fueled equipment to battery-powered vehicles;
• $5.5 million to reduce the legacy of environmental impacts from mining operations; and
• $2 million to develop the next generation of grinding technologies to reduce energy use at Canadian mines.

In addition, CanmetMining’s Green Mining Innovation program, which receives about $12 million in annual federal funding, is helping improve energy efficiency, reduce greenhouse gas emissions, minimize waste and increase productivity in the mining industry.

Yet compared with the mining sector, other Canadian industries have benefited from much greater and more continuous financial support from Ottawa.

In the aerospace sector, for example, Bombardier alone has received more than $4 billion in public funds (most of it as conditional loans whose repayment depends on project performance) since 1966. That included $1.1 billion in 48 separate disbursements from Industry Canada, according to reports by the Montreal Economic Institute and the Fraser Institute.

While federal budget 2019 offered no funding to support innovation by the mining industry, the budget did commit up to $253.1 million over three years starting in 2020-21 for the forestry sector, including up to $91.8 million for the sector's Forest Innovation Program.

Fournier noted that a positive sign is the Quebec government’s 2020-21 budget, which allocated $90 million to support the development of the province’s critical and strategic minerals, including encouraging innovation.

Mining sector is working to "de-fragment" innovation system

The Canadian Mining and Metals Plan criticized the mining sector's "fragmented" innovation ecosystem, consisting of more than 4,000 R&D innovation programs and some 40 mining research organizations in Canada. This fragmentation “contributes to a solo effect and dampens the collective effort to develop and adopt innovative products and processes,” the CMMP said.

Canada’s mining industry, which produces more than 60 different commodities, has evolved into 30 regional innovation clusters that support the industry and the specific products mined in those regions. In contrast, the forestry sector has one national R&D and innovation organization, FP Innovations.

However, for the mining sector, Shpyth said: “I have a hard time thinking of a single cluster or innovation ecosystem that could support 60 different commodities spread out in 30 different clusters across the country.”

Fournier, who served as associate vice-president, strategic partnerships at FP innovations before joining COREM, said: “I think it’s important to have a national approach with better synergy between different mining innovation organizations, but with a regional delivery to make sure that we serve correctly the regional industry.”

Weatherell said the Canadian Mining Innovation Council (CMIC), the only nationally incorporated mining innovation organization in Canada, is part of a new coalition with regional groups that's focused on de-fragmenting the innovation ecosystem. “We're working hard to get people to work together and collaborate on industry’s specific transformative needs.” The goal is to achieve “zero waste mining” in energy, water and environmental footprint within 20 years.

Despite some perception that the innovation ecosystem is fragmented, mining companies are investing in and deploying innovative technologies and processes to significantly improve their operations, Weatherell said. "It (the innovation ecosystem) is not as fragmented as people think."

For example, one of CMIC's strategic partners is the Alberta-based Canada’s Oil Sands Innovation Alliance (COSIA). Between 2012 and 2018, COSIA’s company members invested $1.4 billion to develop more than 1,000 technologies to improve oil sands mine tailings management and reduce industrial impacts on air, land and water.

Oil sands mine operators have reduced their net water use intensity (that is, the amount of water used for every barrel of oil produced) from the Athabasca River by 18%, John Brogly, COSIA’s water director, said in an email. Innovations also have reduced the oil sands industry’s greenhouse gas emissions intensity by 21% between 2009 and 2017.

Despite such progress, there remains a challenge for Canada’s mining sector in taking a pan-Canadian approach to commercialize and deploy late-stage clean technologies, including those from other industrial sectors, Charles Nyabeze, vice-president of business development and commercialization at the Centre for Excellence in Mining Innovation (CEMI) in Sudbury, said in an interview.

To address this gap, CEMI has submitted a proposal, called the Mining Innovation Commercialization Accelerator (MICA), to Innovation, Science and Economic Development (ISED) Canada. CEMI is seeking $40 million from the Strategic Innovation Fund to create a national network that would commercialize and deploy late-state, high-impact, Canadian SME-based technologies for the mining sector. The $40 million would be leveraged with $80 million from the private sector.

“MICA is going to provide a platform for those technologies from other sectors to come into the mining industry,” Nyabeze said. "We're going to be able to find complementary technologies that can be implemented together in a way that leverages innovation."

CEMI is still awaiting a decision from ISED, expected by this fall, on whether it can submit a formal application for MICA.

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