It’s Time to Take Stock

A startling exposé of “our inexhaustible natural resources" myth and a plea for intelligent conservation of our forest and mineral wealth

C. M. CAMPBELL August 15 1931

It’s Time to Take Stock

A startling exposé of “our inexhaustible natural resources" myth and a plea for intelligent conservation of our forest and mineral wealth

C. M. CAMPBELL August 15 1931

It’s Time to Take Stock

A startling exposé of “our inexhaustible natural resources" myth and a plea for intelligent conservation of our forest and mineral wealth

C. M. CAMPBELL

IN AN address at Victoria on May 1 last, Hon. N. S. Lougheed, Minister of Lands in the British Columbia Government made the following statement:

“The mature stands of Douglas fir in British Columbia will be gone in twenty years, and if the export trade continues to expand at the rate of recent years, the fine stands as we know them will be exhausted in fifteen years.”

This is a startling assertion, for three reasons. The first is that it is the result of a census of the fir trees of the province, taken by trained men anjl can be considered as accurate. The second is that it means the approaching end of a very valuable industry, the end in the British Empire of the world’s best large timber. As some companies have limits that will last beyond the period mentioned, it means that other concerns with smaller limits will be affected, and a decline in the industry will begin in about ten years— and this next ten years will pass just as quickly as the last ten years.

The third reason is that it is a direct challenge to those Canadian public men, those self-styled optimists, who cannot make an address without referring toour “inexhaustible,”

“illimitable,” and “inconceivably vast’’ natural wealth.

The attitude of Canadians in this respect is peculiar.

From time to time fact-finding commissions have been appointed to deal with many matters, and their conclusions have been acted on with much good to the country. Statements featuring the incomparable richness of our heritage, however, must not be questioned ; any. body doing so is a pessimist and a knocker. As a matter of fact many of these statements are not optimistic state-

ments at all. They are false statements; they are untruths, and, like all untruths, they have done great harm. Their authors, also, in making them, tacitly give it as their opinion that their fellow countrymen have not the stamina to face the facts. If this were the truth, which fortunately is not the case, there would be real cause for pessimism.

Depletion of Douglas fir is now on the home stretch, and that situation and other similar situations have to be faced, depression or no depression.

No country has illimitable natural wealth, and Canada is no exception. The condition in the Fraser River is evidence of limitations in our fisheries; only one acre in seven in Canada is fit for agricultural purposes; our water power resources, though very large, are not unlimited and with increasing demand we will have need for every watt we are able to produce. These particular assets, though limited, are, however, with proper safeguards, permanent. It is different with our forests, as now worked, and with our mineral wealth.

This article will deal mainly with the latter asset

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which is featured by mining men as inconceivably great, so great and so promising that it will be “Canada’s greatest industry of the future.”

The mineral wealth of Canada can be considered under three headings: PreCambrian, Cordilleran, and the Coal Estimate.

Our Mineral Wealth

EVERY editor in Canada has featured the Pre-Cambrian shield at some time in his career. This huge area, amounting to about 2,000,000 square miles, has produced Sudbury. Cobalt, Porcupine, etc.; therefore, we are told, similar occurrences will be found throughout the entire area on such a scale as to warrant the claim that “the future of Canada lies hidden in the PreCambrian.”

The facts are, unfortunately, that major deposits of the character mentioned occur only in what are known as Huronian and allied rocks, occupying only about ten per cent of the Pre-Cambrian area, and not in the Pre-Cambrian as a whole. Ninety per cent of the Pre-Cambrian, equal to 1,800,000 square miles—over half of all Canada—has not produced a major mining operation and little hope is held out that it ever will. Part of the ten per cent is heavily overburdened with soil and bush and will never be prospected by present methods. Part is easily prospected and has already been examined, while certain sections are still virgin or warrant additional work which, there is reason to hope, will result in further and important finds.

Major discoveries developed during the past fifteen years, a period of heavy expenditure, have, however, been limited to the Noranda and Sherritt-Gordon properties— valuable deposits, it is admitted, but not large when the publicity given the PreCambrian area is considered. The total ore in these two properties amounts to about 12,000,000 tons, and the contained metals would last the world only a few months.

This tonnage is small. Double it, treble it, multiply it by ten, and it is still small. Bear in mind that our mineral wealth has to last us for all time, and that an ore deposit worked out is finished. All that remains is a hole in the ground. There are no refills.

Another point: Consider such companies as the Nipissing and the Dome, both nearing, apparently, the end of their reserves. During a quarter of a century of operation in the Cobalt district, with the exhaustion of reserves in sight for years, the Nipissing, immensely wealthy, having paid over thirty millions in dividends, has, so far, been unable, notwithstanding costly exploration, to find in all Canada another property for its organization to operate and has recently been looking into conditions elsewhere. Similar remarks apply to the Dome, which has recently bought into a South African project. Inability to find other mines with which to carry on is the rule, not the exception. This is an argument for limited, not unlimited, wealth.

The Cordilleran area comprises British Columbia and the Yukon, and the official information given out states that “Probably not one fifth of the Cordilleran belt in Canada can be said to have been prospected at all, and not a single district to have been completely tested.”

Against this statement it should be pointed out that it is now nearly three quarters of a century since prospectors discovered the Cariboo, and during this period the following additional major operations have been opened up: Klondike, Premier, Anyox, Britannia, Copper Mountain, Boundary, Rossland, and Sullivan. These operations, with numerous other minor ones, cover nearly the entire territory. These finds make a creditable showing, but it is important to note that during the past thirty years only one major deposit, the Premier,

has been developed, while four have been worked out.

During this period, Consolidated, Granby, Britannia, and Premier engineers, as has been the case with similar companies in the East, have been active and have made huge expenditures in an attempt to find other properties, but without success to date. The Consolidated, formerly a large producer of gold and copper, has been practically forced, due to exhaustion of reserves of these metals, to give up their production.

While results in recent years in the Pre-Cambrian and Cordilleran areas have been meagre when claims made are considered, they will, however, compare favorably with the results in most other mineral countries. Not only have such mines as Premier, Sherritt-Gordon, and Noranda been opened up, but important minor deposits have been found. The Premier was considered of questionable value for some years; the Noranda in early years gave no promise of developing into its present importance. Possibly some of the minor properties have surprises in store. Major operations such as Sullivan and Frood have astonished the world with the wealth of their, previously unknown, extensions. All this indicates valuable metallac wealth, but even allowing for other important finds, the entire total indicated is still very limited in amount. Why not face the facts and try and make the very best use we can of these reserves?

Coal Reserve Estimates

CANADA possesses one sixth of the world’s known coal,” says a recent audit of our mineral wealth. This statement is based on the official figure, which allots 1,234 billion tons of coal to Canada out of a total for the entire world of 7,397 billion

The Dominion’s production comes from three leading areas: Vancouver Island, Alberta, and Nova Scotia.

The Vancouver Island reserves are found mainly in the Comox and Nanaimo districts and are given as 5,793 million tons. These figures were checked over about 1922 and reduced to twenty-five million tons of actual and recoverable coal, with possibilities reaching to 236 million tons only.

Vancouver Island operators are in difficulties, due, it is stated, to fuel -oil competition. The basic trouble is, however, the fact that the coal is so difficult to mine that it costs the operating companies about six dollars per ton—the average of slack, nut, and lump prices—in cars at the mine. This is three times the cost of coal in cars at many mines in the United States. The vital fact is that, both in Vancouver Island and in Nova Scotia, instead of the supplies being enormous as the figures would indicate, the cheaply mined coal is already exhausted.

Even with its handicaps, the industry would struggle along in better shape were it not for the fact that Federal authorities, in order to help the Nova Scotia operators, have placed a duty of seventy-five cents on American coal, and the Western operators, whose market at one time was largely in the United States, had to face the retaliatory, duty of the same figure and have lost much of this market. The coal organization of Vancouver Island is a valuable organization for Canada and it should be maintained if at all possible. One of these days fuel oil competition will work itself out and coal will again be king.

The Alberta reserve is given at 1,075 billion tons. The Alberta Coal Commission went into this estimate in 1925. Due to the fact that the cretaceous coal of Alberta is very irregular as compared with the carboniferous coals elsewhere, and for other reasons, this total was found to be far too high; and it was estimated that all the coal it was safe to report as a real reserve amounted to only twenty-eight billion tons. Fortunately this is still a very large total.

The Nova Scotia reserve of 9,718 million

tons has not been checked over, but the operators have pointed out that appreciably increased production would dangerously deplete the better grades of coal, particularly the metallurgical coal.

It is doubtful, therefore, if more than five per cent of the official estimate represents a real reserve. In other words, about ninetyfive per cent of the huge total probably is make-believe.

Petroleum and the Base Metals

CONTINUING the inventory we find that three quarters of a century of exploration has not opened up any appreciable reserve of petroleum. In 1928 our petroleum production was only slightly over one million barrels compared with a world production of 1.488 million barrels. We are, generally, wasting our reserves of natural gas in order to save the trace of oil it contains.

We have no known reserves of good grade iron ore. Possibly 300 million tons of medium or low-grade ore, tributary to population, are available. This would last the world about twelve months. There are also large low-grade outlying reserves.

In the alloy metals—chromium, manganese, molybdenum, nickel, tungsten and vanadium—we have commercial reserves of nickel only. In the Canada Y ear Book, 1930, page 40, we are told that Ontario “has reserves to last for centuries.” According to the report of The International Nickel Co., owner of the largest reserves, these amount to slightly over 200 million tons, two-thirds low grade. The high-grade ore is good for twenty-five years only, on the basis of 1929 depletion. Equipment is available to double this output, thus cutting the life in two and leaving the low-grade for the future.

Fortunately these deposits have not been bottomed, and the life may, or may not. greatly exceed this estimate. As present capacity may be further increased before long, it is obvious that life for this operation beyond a quarter century is speculative.

Associated with nickel at Sudbury is our most valuable copper reserve. Roughly, Canada has copper ore representing six million tons of metallic copper blocked out, compared with about 100 million tons throughout the world. There are important possibilities beyond these figures both in Canada and elsewhere. Depletion has trebled since the beginning of the century, and now amounts to two million tons annually. The Canadian reserves would, therefore, last the world about three years.

Lead and zinc in Canada mean the Sullivan mine, now the leading mine of this class in the world. General opinion gives this mine a life of not less than twenty-five years at the present rate of depletion. It is understood that there is still ore at the greatest depths reached so that the life may be further extended provided the rate of depletion is not increased. Zinc is associated with copper in some of the Eastern Canadian deposits, and an important deposit of lead-zinc ore is reported from the Great Slave Lake district.

We have important reserves in gold, but there has been a marked lack of important new gold finds during the last fifteen years. New silver finds have been almost negligible. On the other hand, reserves of the platinum group metals have been greatly increased due to the development of the Frood ore

In regard to other metals, arsenic, bismuth, cadmium and cobalt are produced in some quantity; some ores of beryllium, lithium, radium and titanium are reported, but there is negligible production; while ores of the important metals, aluminum, antimony, mercury and tin, are unknown in commercial quantities in Canada.

Canada, 1930, an official publication states on page 80 that we produce “eighty-five per cent of the world’s asbestos.” The idea generally held throughout Canada is that

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we have a practical monopoly of this production. The facts are that we produce less than seventy per cent of the world’s asbestos, and, what is more important, we produce only about fifty per cent on a valuation basis. We have practically lost the European market, and Russia is challenging our control of the American market. The common and preferred shares of the leading Canadian company are, due to depletion of reserves and keen competition, practically valueless and the bondholders at present do not receive their interest.' On the other hand the operations of some of our competitors are very profitable.

In fertilizer minerals we have a negligible representation. Chili supplies our nitrates except what we extract from the air; the United States our phosphates, though there are some possibilities in the Rockies; and Germany our potash. These minerals are very important. The production of nitrates in Chili to date amounts in value to about $3,000,000,000, or sixty per cent of the entire mineral production of Canada. Similar valuations can be placed on the output of phosphate and potash.

We produce no sulphur and have no reserves as such. We have, however, considerable reserves of pyrite, and credit should be given to recent Canadian research for developing a method to use the sulphur in the pyrite, leaving an iron ore as a byproduct. We produce sulphuric acid from smelter fumes at Sudbury and Trail.

In the production of precious stones, a very large industry, we take no part.

We are unable to supply our needs in natural abrasives. Barite products imported amount to a million a year, and, though we have reserves, we have done nothing to capture this business. Borax is supplied by the United States. We have a favorable balance in feldspar. We are short in fluorspar, and, while we export graphite, we import the products. We have splendid gypsum resources and are looking for export markets. We produce no iodine. There is a shortage of iron oxides. We now import all our Epsom salts. We produce more magnesite than we need. Our production of mica is falling, and mineral water production is one-quarter what it was thirty-five years ago and our imports are now seven times our production. Our salt reserves are large but are unevenly distributed, and our imports equal half our consumption. We claim the largest deposit in Saskatchewan, in the world, of sodium sulphate, used in different industries. Our imports of silica brick and quartz equal a third of our needs. All strontium is from England. We produce twenty per cent more talc and soapstone than we need.

In clay products we fall short of meeting our needs by $10,000,000 per year, half of which, however, represents our imports of British chinaware. We are short even of sand and gravel, and our unfavorable balance in stone is about a million dollars per year. There are small favorable balances in lime and cement.

To sum up, in so far as our mineral wealth is concerned, the evidence is that, with all our mines in operation, we are unable to supply our own mineral needs.

Dealing with raw materials alone, and including such articles as cement and rolling mill products but no further fabricated material, the aggregate figures show that in 1928 we fell short of supplying our own mineral needs by the large amount of $127,000,000.

In case after case, we have no reserves or insufficient reserves. It is also quite true that in some cases we have unused reserves that might be used, and it is one of the objects of this article to call attention to this condition. The outstanding fact, however, is that the different parts of the world are interdependent in regard to minerals, and that Canada is, at present, more dependent on the rest of the world than the rest of the world is on Canada, and it is high time we dropped our superior attitude. With the possible exception of nickel, the world can get along without any mineral contribution from Canada. Even nickel is not essential,

for its qualities as an alloy metal can be largely duplicated by other alloy metals or their combinations.

The Eldorado that Petered Out

TT IS sometimes stated that if the people of this country want to believe the currently popular stories of vast natural wealth, why not let them? What harm does it do?

In 1903 Sir Wilfrid Laurier, in bringing in his bill for the construction of the Grand Trunk Pacific and the National Transcontinental railroads, said:

“It is established that the railway would place us in communication with the Omineca district, famous for its gold mines which today are idle because it is impossible for the miner to get access to them with his tools and provisions, but which, probably, the moment we secure access to them will develop into another Klondike . . .

It is established,” said Sir Wilfrid also, “that the region between Winnipeg and Quebec is rich in all those resources that go to make up a fine agricultural and industrial country.”

Sir Wilfrid was imposed upon, for both the above are typical boom statements. The alleged gold mines, lode and placer, reached a maximum gold production of $43,000 in 1915, while the usual output has been about that of 1929, when it was $7,000—one hour’s production from a real Klondike. As for the railway between Winnipeg and Quebec, nearly all in the Pre-Cambrian area, mining men have not opened up one solitary mine on that road, and the very few tributary mines could be served by other lines. The subsequent history of these railways, the Canadian Northern, a product of similar methods, and the Grand Trunk, is well known and need not be narrated.

What harm do these stories do? The Grand Trunk shareholders lost their common stock; the Canadian Northern shareholders received $10,000,000 for stock that cost them many times that figure, and the Canadian public is now asked to stand for a reduced valuation for the entire system. We stand to lose one billion dollars on this one deal alone.

Add to these losses the loss from wasteful habits developed by the persistent stories of colossal natural riches, the waste of timber, soil, soil fertility, fish, natural gas, and above all the heavy waste incurred and the disorganization brought about through booms and their consequent depressions, and we add to the total other billions of dollars. Canada cannot afford to lose money at this rate.

The fact that our public men do not hesitate to endorse “fabulous wealth” propaganda indicates that they believe that their action will in some way benefit the Dominion. Possibly they have a vision, and think it only a matter of detail to make it a reality. Such a procedure sometimes works

in mental cases, but it won’t work in the physical world. It cannot be applied to a sawmill so that it will produce bridge timber from second growth fir. We may have faith that will remove mountains, but there is no faith that will produce a mountain of ore that does not already exist. That Canada may become a much greater country than is now the case may be true, but it will not be brought about by the continued increased export of raw mineral wealth based on the faith that these resources are like the widow’s cruse.

Another phase of this policy of misrepresentation is the belief that we should not refer to such handicaps as ice and snow. It deters capital from coming here, we are told. One of the main reasons for the circulation of stories of inconceivable mineral wealth, we are also told, is that these stories will attract capital.

All this presupposes that capital invests and then investigates, which is the one thing that capital does not do. Capital is not afraid of ice and snow; it does not go into a mining deal on the seller’s report, but it does resent misrepresentation. Outside capital is aware of our limitations better than many Canadians are themselves, just as it is aware of the country’s advantages.

The Remedy

'T'HERE is just one policy that will result in the building up of a worth-while nation in this Dominion, and that is the policy which aims at development based on facts. “Knowledge,” we are told, “is the greatest weapon for the advancement of mankind.” Knowledge is nothing more than accurate information. It is an acquaintance with facts, and therein lies the greatest weapon for the advancement of Canada.

Apply this policy to our forest problem and what do we find?

Mr. Lougheed whom I quoted at the outset of this article has already suggested the answer. Reforestation, artificial and natural, must be accelerated, even though it will be generations before the returns come in. Some Canadians say that artificial reforestation is economically unsound. If it is not economically unsound in other countries, why should it be here? A crop of trees is not only a most attractive sight but it carries the conviction that Canadians are here to stay and not merely to make a stake and then move to California. If, with our present unemployment, we cannot reforest by artificial means much of our depleted territory, the future of the country is dark indeed. In addition to reforestation, substitutes such as hemlock and cedar are to be used whenever possible. No claim is made that this programme will prevent the decline that looms, but it will lessen its effects, and if the problem is vigorously attacked we should have other industries coming along to take the place of this one as it passes out.

I have shown that exhaustion of our mineral wealth has also to be faced, and if new finds are not made faster than has been

the case in recent years, the depletion of much of our mineral wealth will synchronize with the depletion of the bulk of our timber wealth; and unless we are prepared we will be face to face with a depression that will differ from the present one only in the fact that it will be more permanent. Now is the time to start preparations, and the following plan is suggested:

1. An accurate inventory of our known mineral reserves should be made by engineers familiar with the rules governing the estimation of reserves. A second inventory will list the probable sources of mineral. With these inventories available, further details of a plan can be worked out.

2. The entire districts of Keewatin and Mackenzie should be withdrawn from further staking, and geological and exploratory work concentrated in areas now served by the railways where industries are really needed. International Nickel does not work all its deposits at once; some ore bodies are held in reserve. The Far North should also be held in reserve, and explored and mapped when work in accessible sections is completed.

If independent prospecting companies are allowed to operate in the Far North they will, it is hoped, make discoveries, and they will expect to work them and bring out the ore. They will demand transportation and they will likely get it. In fact, an editorial in an influential Western daily recently advocated a railway to Liard, from where there is summer transportation to the Arctic. This transportation system would tap, we are told, “at least fourteen billion tons of copper ore, more than in all Rhodesia, near Coronation Gulf.” The fact is, there are some encouraging prospects in this section, but no tonnage whatever was blocked out when this statement was made. The editorial also mentioned fur and fishery resources of similiar fictitious character. This is typical propaganda preliminary to railway building, preliminary to another boom.

Our present objective is not new railways but new mines along the present railways. Never mind rolling the map back farther just now. In the Pre-Cambrian area alone there are 6,000 miles of railways originating no mineral freight. Similar conditions exist in the Cordilleran.

3. In view of the very limited known reserves, every effort should be made to recover everything but the squeal from such minerals as we have; to co-operate with other members of the Empire and with the rest of the world,so that these irreplaceable raw materials can be used to the best advantage. If depletion records, misnamed production records, continue to be our chief aim, these reserves will soon disappear.

Some mining men tell us not to worry, that the crust of the earth is as thick as ever and that ultimately we can work it for the extremely small percentage of economic mineral wealth that it contains.

This may be true, and when that day comes—it may not be far off—we will, I think, experience the feelings of the prodigal son when he found his subsistence limited to the husks that the swine did eat. Some day research may find a way to obtain minerals from the earth’s crust as a whole; research may also find a way to make a delectable dish from pig feed. A solution to neither problem is yet among the possibilities, and until that day is in sight it would seem desirable that we try and make better use of our present wealth; that we try and make a living from our interest and depend less on our principal; or if we sell the principal, we should see that the receipts are better invested than has been the case to date. Our present progress can be likened to what would happen to the Canadian Pacific Railway if it started in to pay dividends by selling a branch line, or a few hotels and steamships each year.

The same methods that made a success of the Canadian Pacific, that placed Great Britain in the van, that gave Holland, with an area appreciably smaller than Nova Scotia and with negligible mineral wealth, a place in the sun, will give Canada a much more desirable position than she now holds— if we face the facts. The End