At the end of last month, the Terrace Economic Development Authority attended the Association of Mineral Exploration’s Round Up conference.  This conference brings together individuals and organizations representing all components of the global minerals exploration and mine development industries.  In 2011, Round Up saw over 7,000 delegates attend, this year in 2012, Round Up had over 8,500 delegates!

The City of Terrace, which is surrounded by mining activity with over a dozen of potential mines in the region (some of the more developed properties can be found on www.investnorthwestbc.ca) stands to gain substantially by this development.  Many of our businesses currently service and supply these mines, and as the properties continue to develop, the businesses will have even more opportunity to work on the project.

The forest industry was the backbone of the economy of Terrace decades ago when it had several mills operating.  In 2001, the United States had a dispute around Canadian subsidies and USA imposed a countervailing duty tariff on all lumber from Canada, which is now known as the softwood lumber dispute, one of the most significant and enduring trade disputes in modern history. In other words, the United States felt that their domestic producers of softwood lumber couldn’t be competitive because of Canadian Government subsidies on softwood lumber so to even the playing field, taxed all Canadian lumber as it entered the country.  This had a huge impact on the City of Terrace, now all of the major mills are currently shut down and dismantled.  The closure of mills had the negative repercussions of residents being laid off and industrial tax revenue to Terrace declining.

In 2002, the Provincial Government began to explore China as material market and began developing this market.  The ground work by the Provincial Government has proven successful with their strategy of finding a new market in China.  In 2001, BC had zero lumber being exported to China and in 2011 exported close to $1.5 billion of lumber to China.  China now represents 30% of BC’s lumber exports.

2012 will be an exciting year as construction begins on many major projects worth billions of dollars.  We have outlined a few large projects that plan to begin construction in 2012.  You can keep yourself up to date on these projects by visiting www.investnorthwestbc.ca or checking out our own site here.

Northwest Transmission Line - Terrace

Mining is considered as the future economic driver of Northwest British Columbia, which is a shift from the logging industry that this region was built on.  As the Northwest Transmission Line gears up for construction, and mines work through their permitting and assessment process, many wonder what impacts the industry will have on Northwest BC and Terrace.

Natural resource jobs, including mining the huge amount of mineral deposits in Northwest British Columbia, are very high paying jobs in relation to the national average.  There is little income disparity throughout the world in the mining industry, which has become a global issue with the occupy movements, because natural resource extraction jobs cannot be moved.  In a global economy, services can move to where costs are the lowest.  Currently we are seeing many jobs outsourced to China because of the low costs of labour.  The minerals in the mountains of Northwest British Columbia cannot be moved so the extraction jobs can also not be moved.

On Dec 1, 2011, it was announced by Jean Simone, the President of the Primary Metal division of Rio Tinto Alcan that the modernization has been approved by the Board of Directors.  The announcement has been long awaited and much anticipated as Rio Tinto Alcan has already spent $700 million on the project to this point.

What this means for local businesses in Terrace and the region is that the project managers can begin to comfortably purchase their supplies and hire their services without risk of the plug being pulled on the project.  Rio Tinto Alcan has committed to using local businesses as much as possible to complete this project, which is similar to their operational policy.  The economic benefits of this project are immense, it guarantees nearly 1,000 long-term, and high paying jobs in the Northwest and will generate significant spin off jobs.

Tomorrow on December 1st, Premier Christy Clark and Rio Tinto Alcan CEO, Jacynthe Cote, will be at the Kitimat Modernization Project’s Construction Village to make an important announcement.

Rio Tinto has not yet released details regarding the subject of the announcement, but we expect that they will declare the final Board of Director’s approval of the Kitimat Works Modernization project. If this is the case, it will further support their expressed commitment to the development and growth of communities in the region.

We’re getting ready to publish the 2012 Terrace/Kitimat Industrial Service Directory, which we printed for the first time last year alongside the KT Industrial Development Society. This year, we’ve also partnered with the District of Stewart as part of an ongoing effort to work with neighbouring communities while promoting the region.

The directory was developed to promote local industrial businesses to the many major companies operating in the region, who can be unsure about what local services and supplies are available to them. Earlier this month, we interviewed Craig Nelson of Avanti Mining Corporation, who referenced how his team has been making use of the directory as they move the Kitsault Molybdenum mine forward (you can read the full article here).