different types of mined rock

Claim Staking Fees

Prior to August 2013, Nova Scotia’s claim staking fees were already high compared to other provinces. In August 2013, the government exacerbated this problem by increasing staking fees by 75%.
These huge fee increases are discouraging exploration and are particularly hard on individual prospectors who simply cannot afford them. Many prospectors are being forced to abandon claims because the fee hike, applied to significant numbers of claims, can increase fees by thousands of dollars. In other words, prospectors are giving up their claims and walking away from potential future mines because they simply cannot afford to keep them. The Ivany Commission said mining is an essential part of Nova Scotia’s economic future but the government is choking off the future of our industry with these fees.
To illustrate the impact of the fee hikes:
  • A prospector with 50 claims now has to pay $9500 in fees over ten years instead of $5,424 prior to the fee hikes, an increase of $4076.
  • A prospector with 300 claims now has to pay $57,000 in claim renewal fees over ten years instead of $32,547 prior to the fee hikes, an increase of $24,453.
These staking fees are in addition to various other fees and work requirements imposed by the Department of Natural Resources.
Because prospectors are at the beginning of the long and difficult mining cycle, their claims usually generate no revenue during this ten-year period and the vast majority never result in an actual mine being developed. They therefore cannot afford such a dramatic increase in costs.
The fee hike also puts Nova Scotia fees dramatically out of step with other Atlantic provinces. The new fees are, on average, 53% higher than New Brunswick’s and 621% higher than Newfoundland and Labrador’s.
It is also important to note that the incremental revenue the fee hike will generate for the government (i.e. $75,000-$85,000) is virtually insignificant in context of the government’s $9.9 billion budget. The harm being caused to the industry by the fee increase is completely disproportional to the small amount of revenue being generated for the government. The fee increase is particularly short-sighted given the millions of dollars in taxes and royalties that a single mine can generate.
In other words, the government can afford to give up the fee hike money. Prospectors cannot.
Additional details on this issue are available in letters we sent the Government in April and May 2014.