The GNWT’s 2021 budget estimates zero royalties from the mining industry this past year, as its own-source revenues decline.
The mining sector has been hard hit by the pandemic, with the international market severely declining and costs rising due to COVID-19 restrictions.
Initial estimates in the 2020-21 budget forecasted $30.7 million in royalties from mining in 2020, but the revised budget forecasted the GNWT would receive no royalties. The numbers in 2021-22 are only slightly higher, with the GNWT anticipating $1.5 million in royalties from mining companies.
Finance Minister Caroline Wawzonek says December’s numbers — which aren’t included, as the 2021 budget only uses data up to the end of November — showed a little money may be outstanding, and could eventually count in the final 2020 royalty totals.
“I don’t have a crystal ball on exactly how that will unfold and similarly with mining and the global markets again, I’d love to know, but I don’t,” she says.
“Although the signs are that there is a recovery underway.”
The 2021-22 budget included $400,000 for the mining incentive program, to encourage mining companies to undertake new mining projects.
That could be important for the industry’s future, with a Canadian Northern Economic Development Agency report said the NWT’s economy was set for a worse future than the other territories, partly due to an aging mining industry.
“The territory’s diamond production has likely passed its peak, as indicated by mining plan.”