Yes. Thank you very much.

We're very pleased to be here and have the opportunity to present to the committee.

My name is Douglas Morrison. I'm the president and CEO of the Centre for Excellence in Mining Innovation, called CEMI, based in Sudbury, Ontario. My colleague here is Bora Ugurgel, managing director of the ultra-deep mining network, which is focused on productivity below 2.5 kilometres, or 8,000 feet below surface.

CEMI was established in 2007 by both industry and government. We help solve mining industry challenges by delivering commercially viable innovations to enhance safety, increase productivity, and improve environmental performance. The ultra-deep mining network was established three years ago and is funded by the federal BL-NCE network.

My 35-year career in the mining industry includes 15 years working in the underground mines in Sudbury in operations and mines research, then another 16 years living and working in Australia, South America, southern Africa, and other places as well, finishing as the global mining sector leader for the consulting company I worked for. The last five years at CEMI have been to build a 17-person team that focuses on innovation and commercialization of research.

CEMI's internal technical staff has over 30 years of experience working in mines, and we are the only innovation/mining research group that has that capability; 40% of our staff are senior business professionals who then negotiate commercial agreements with companies to commercialize the work we've done and move that through. No other research or innovation group has that internal capability.

Our primary focus is metal mines: gold, nickel, copper, and zinc. Those are the underground mines based in Ontario, Quebec, and Manitoba. Also the copper mines based in B.C., which are now becoming underground mines as well. All our solutions apply to the global mining business. The solutions we developed for our mines in Canada apply to all metal mines everywhere in the world.

Commercialization of mining innovation helps the mining industry to improve its operational performance and its rate of return. That's why mines are operating.

Our core advantage is the ability to bring together the best teams in the world to close the innovation gap—everybody's heard of that—but the bigger gap is the commercialization gap and our lack of ability to move things into a commercial setting. Our ability to do that gives us a huge advantage to be the leader in commercializing and implementing innovations on a global scale.

Your committee is trying to investigate how to create economic opportunities for the mining industry. We recommend that to create a strong foundation for future growth, the government should invest in developing the scale and range of the mining service and supply sector companies. We in Canada cannot influence where global corporations invest capital. We can make sure that we deliver innovations to our mines that make them globally competitive. If they're not globally competitive, they will close.

By vesting our service and supply sector companies with innovations that improve productivity in our local mines, they can expand their businesses to customers in mining jurisdictions all around the world, and by doing so, increase employment here at home.

To achieve this, government needs to invest in organizations like CEMI with an established team of experts who have experience in the industry; who focus on innovation, not research; and who have a global perspective on where the industry has to go. It is critical to distinguish between research, which gives you a technical result, and innovation, which gives a commercial result. If mining companies cannot buy or lease technology or hire expertise, the investment in research is very limited. You have to have a transmission from the research end of the spectrum to the industry part of the spectrum. We are focused on that innovation component.

To do that we need an effective innovation ecosystem, as well as investing in basic research activity.

The strength and scale of our current mining service sector is the unique advantage our industry has. Yes, we have over 37 mining centres across the country, but we only have four, perhaps five, mining clusters. A cluster has to have a critical mass of mining companies, service and supply companies, research facilities, and innovation groups that all work together to improve the performance of those operations.

We have over 37 centres across the country, but we don't have that many clusters, and we need to focus on them. The largest and most comprehensive of all those clusters is in Ontario, split between the small and medium-sized enterprises in Sudbury and northern Ontario, and the large, original equipment manufacturing companies, OEMs, in southern Ontario.

This is not a northern issue. This is a national issue on how we manage this business for the benefit of our economy. There are tremendous opportunities to improve the environmental performance of the mining industry, and it's essential to do that for us to get the social licence to operate in the future. We can see all around us in every country in the world how that issue is changing rapidly.

We propose that you invest $60 million in CEMI over five years, with half based on environmental changes and environmental improvements and innovations. Because of our track record in commercializing results, we already know that with that scale of funding we can bring another $200 million from private sector companies to collaborate in that effort to make those improvements happen.

The first one would be the clean mining program of $13 million. That's to improve waste-water management from tailings facilities. Another one is a remote access program, which is $30 million to improve rapid access to remote locations, remote sites, remote communities, and make that happen much faster than you can with infrastructure. That would also bring a large amount of funds.

The lean mining program is a continuation of the ultra-deep mining network, and that focuses on productivity. We have to introduce low carbon, reduce emissions, and all those things, but we also have to make sure we move ore more efficiently and cheaply. Mines have to be productive. Our programs have a five-year horizon, with the design to have measurable impacts in earlier stages of the five years. We do address safety and we do address environmental issues, but not at the expense of productivity.

Mines close because they are insufficiently productive to provide a return on investment, not because we have safety or environmental incidents. We need to be focused on what the business is about while improving its overall performance.

Our objective is to see existing mines continue, new mines open, and to increase employment in Canada to make that happen. Most mines are focused on reducing employment in their mines. We want to see that employment shift from the mining companies themselves to the service and supply sector. The opportunities for indigenous communities to participate in middle development initiatives are increasing all the time, and the mines are already the biggest employer of aboriginal peoples.

A remote program would create several indigenous businesses to enable the delivery of services and supplies to communities and to mine sites far sooner than traditional infrastructure. New mining developments are the best chance for indigenous communities to establish a sustainable economic foundation, but only if there are new mines. New mines have to meet all the needs of local and indigenous communities, yes, but they also have to meet the needs of the global metal market. Those two things have to come together.

Several large mines in northern Ontario are scheduled to close within the next five years, and no replacements are planned. It takes five to 10 years to bring a new mine into production, and that means there's already a production gap that cannot be filled if we only continue to repeat the processes we have used successfully in the past. There will be no major base metal operations developing new ones if there's no innovation. Innovation is essential to make that happen.

We have to be smarter, faster, more cost-effective in every aspect of the mining business. Innovation is essential to the survival and growth of the industry at home and to the expansion of our service sector companies through international trade.

Investing in the commercialization of innovation is one of the best ways for government to sustain and build economically sustainable communities across Canada. Investing in organizations like CEMI means investing in Canadian ingenuity and Canadian business acumen to help us deliver our commercial advantage to the global mining industry.

Thank you.

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