Canada’s Association for Mineral Exploration (AME) has recently released an economic impact assessment conducted by EY. The assessment examines the federal government’s commitment to expanding the exploration activities under the Canadian Exploration Expense (CEE) and the Mineral Exploration Tax Credit (METC).
The AME notes that when elected in March 2025, Prime Minister Mark Carney’s government made a commitment to this expansion, updating the METC in Budget 2025. The AME notes it is ‘optimistic’ that the government will follow through with its commitment on the CEE in Budget 2026 later this year.
President and CEO of AME Todd Stone says that Canada has the minerals that the world needs and the opportunity to secure that critical mineral supply chain.
“We know that by expanding CEE eligibility, the federal government will help kickstart 171 mines across the country awaiting commercial production, bolstering Canada’s economic resilience and sovereignty, and creating thousands of good, well-paying jobs,” Stone states.
The EY report notes that the government’s commitment would create up to 34,000 full-time jobs over the next 10 years, with C$1.6 billion ($1.6 billion) in added mineral exploration spending annually.
It also estimates up to C$33 billion in total economic growth from three to five mines entering production, and a 5x return in gross domestic product (GDP) for every dollar invested.
The AME notes that no other single public policy could bring Canada’s premiers together with a comparable impact on investment.
“AME is joined by the governments of British Columbia, Alberta, Saskatchewan, Manitoba, Nova Scotia, and Yukon calling on the federal government to incentivise investors by expanding the CEE in Budget 2026,” Stone says.
The EY report concluded that 2,052 projects across Canada are currently in their early stages, with Stone noting that a lot of these have “stalled”.
British Columbia’s Mining Minister Jagrup Brar noted in a letter in August 2026 that within B.C., major mining projects continue to face financing challenges, especially in the latter stages of permitting as they prepare to move into development.
“This is […] a time period of minimal news flow to the investment community, resulting in a lack of investor excitement in public markets,” Brar says.
“The ‘valley of death’ is a particularly difficult period for companies (especially single asset companies) to finance their projects, compounded by the breadth of technical studies that a modern mining project requires to proceed through regulatory processes.”
CEO of the Nunavut and Northwest Territories Chamber of Mines Paul Herbert echoed these sentiments regarding the funding needed to move projects along.
“The Canadian exploration expenses don’t allow for economic assessments and feasibility studies to be put through, and those are a critical part of the process leading up to actual project approval and construction of a project,” Herbert says.
“You need more than a drilling program to demonstrate project viability. You need those studies, and they can be very costly to produce. So having them eligible to expense will make a big difference.”
For many Canadian explorers and developers, the proposed changes could provide a much-needed pathway through the industry’s financing “valley of death”.
By reducing the capital burden associated with technical studies and project advancement, the reforms have the potential to accelerate the development of hundreds of projects across the country.
That means bringing new mines closer to production while supporting jobs, investment, and Canada’s long-term critical minerals strategy.
Write to Amy Rotman at Mining.com.au
Main image: Association for Mineral Exploration
