With the advent of United Nations-driven global net-zero mandates, demand for rare earth minerals is on the rise, and so are investment opportunities in sustainable mining for Canadian investors.
Renewable energy is an essential component of phasing out the global reliance on fossil fuels in order to reduce emissions for everyday power consumption needs. However, many of these pieces of green prop tech — from the coating on solar panels to the components for the battery in an EV — require mining.
This presents a challenge for the industry as a whole, but also provides the chance to get in on the ground floor of the green energy wave.
In this article, we’ll dive into the future of sustainable mining and prospects for Canadian investors.
What are the existing issues in mining?
To be clear, there’s always an upfront environmental cost of a mining project.
Mining typically begins with removing trees, shrubs, grasslands and meadows to make room for mining infrastructure. Depending on location, this may also involve the displacement of existing indigenous groups or entire communities.
Historically, clear communication with these communities has been a persistent problem. This has resulted in a push for more transparency for mining practices given that communities are left holding the bag after the operation shuts down.
During the active mining phase, other issues take shape.
Mines need to purify gangue, or a mix of soil and undesirable minerals, to produce ore. This is done through chemical treatment, which produces toxic run off that’s stored in tailing ponds where mining waste is stored under water.
Although alternatives exist, tailing ponds remain an industry mainstay.
All that, plus mining also needs heavy machinery, which are typically powered by fossil fuels. In particular diesel powered trucks contribute heavily to a mine’s carbon footprint, according to the Rocky Mountain Institute.
As a result, mines have a heavy impact on local environments by damaging the earth, water and air.
This begs the question, how can mining ever be sustainable given the industry’s environmental impacts?
How sustainable mining works
Sustainable mining aims to mitigate the baked-in environmental cost of ore extraction through a trinity of changes to mining practices:
- Improve consultation with impacted communities to preserve and support their quality of life throughout the mining process
- Reduce fossil fuel emissions and carbon generation during the active mining phase
- Remediate the mining site following the closure of the mine
It’s also important to note that sustainable mining operations are assessed based on their lifecycle, not the shovel-breaking environmental impact.
Sustainable mining in Canada
Sustainable mining practice can be broadly split into three categories: the negotiation phase, the active mining phase and the remediation phase.
Negotiation
The first step to sustainable mining is a robust consultation process with any communities impacted by development.
This includes not only speaking with local stakeholders, but also determining the economic benefits a mine can bring to a community. Typically this takes the form of new jobs or apprenticeship programs. Infrastructure improvements are also common through implementing higher quality roads or improving internet access, according to the Ontario Mining Association.
In Canada, mining projects often involve negotiating with treaty holding indigenous groups such as the Temagami First Nation and Teme Augama Anishnabai. It can also involve community consultation, as seen in the myriad of mining projects in Timmins, Ontario. This duty to consult is split between Federal and Provincial or Territorial governments.
For more on this, you can check out the Government of Canada’s interactive map on indigenous mining agreements.
Electrifying active mining
During the active mining phase, the big thing mining companies can do is electrify their fleets of heavy machinery, or utilize energy from a renewable grid or micro grid.
One such example is ABB’s Ability eMine line of electrified trolleys and transportation vehicles. Some of these vehicles are built to transport materials hundreds of kilometers through the Australian outback, according to their white paper.
Making changes at this level is paramount, but may also dramatically intensify grid demand. For example, electrifying the global iron ore industry could require between 20 and 30 terawatts hours of electricity, according to McKinsey and Company.
The ultimate goal here is to drop direct carbon emissions. Secondary benefits include reduced heat and reduced noise of vibrations, according to Agnico Eagle which operates mines in Ontario.
Long-term site remediation
Finally, sustainable mines need to take post mining remediation measures seriously.
Producing waste is, for now at least, an inescapable part of mining operations. With that being said, reclamation efforts have proven successful in the past.
One of the best Canadian examples of this is the Falconbridge mining reclamation project in Sudbury. In 2023, Sudbury celebrated the 50th anniversary of its re-greening program, which involved the planting of millions of trees.
Coupled with efforts to reduce emissions and mining waste, large areas of previously contaminated land have been reclaimed.
Canada also developed the Towards Sustainable (TSM) set of performance standards by the Mining Association of Canada (MAC) in 2004, which is updated regularly. Adherence is mandatory for all MAC members and covers many of the issues discussed above — from tailing pond management to carbon footprint reduction.
Given Canada’s immense biodiversity, balancing economic growth with environmental protections and social responsibility is essential to the future of the country.
Ways to invest in sustainable mining
If you’re interested in sustainable mining practices you can approach investment opportunities from several different directions. Here are some ideas to get you started.
- Mining companies that are attempting to to reduce or fully offset their carbon footprint
- Manufacturing companies that are building the EV vehicles needed for electrified mines
- Renewable energy grid alternatives — especially those that slot into a micro grid for mining operations
- Mining companies that are digging for the rare earth metals that power batteries for fossil fuel alternatives
- Firms that are developing more efficient renewable energy solutions
In short, investing in the mining sector doesn’t necessarily mean investing in mining operations themselves.
There’s an entire constellation of options for investment depending on your understanding of the technologies involved in reaching 2030 and 2050 fossil fuel reduction targets.
Examples of sustainable mining operations you can invest in
Several mining companies listed on the Toronto Stock Exchange (TSX) have demonstrated commitments to sustainable practices. A few notable examples, include:
Newmont Corporation (TSX: NGT): Recognized as the world’s leading gold miner, Newmont has been acknowledged for its sustainability efforts. Notably, it was the only mining company included in TIME’s list of the world’s top 100 most sustainable companies for 2024, ranking 84th.
Alamos Gold Inc. (TSX: AGI): This Canadian multinational gold producer operates mines in North America and has been recognized for its environmental, social, and corporate governance (ESG) performance. In 2022, Alamos announced a company-wide target of a 30% reduction in greenhouse gas emissions by 2030 and released its first Climate Change report in 2023.
Agnico Eagle Mines Limited (TSX: AEM): Agnico Eagle is a Canadian-based gold producer with operations in Canada, Finland, Australia, and Mexico. The company has a long-standing commitment to environmental stewardship and has been recognized for its sustainability initiatives.
Avalon Advanced Materials Inc. (TSX: AVL): Specializing in rare metals and minerals, Avalon focuses on sustainable development and has produced comprehensive corporate sustainability reports. The company’s projects include the Nechalacho Rare Earth Elements Project and the Separation Rapids Lithium Project, both emphasizing environmental responsibility.
Kinross Gold Corporation (TSX: K): Kinross has been recognized for its corporate responsibility initiatives. In 2015, it achieved an A− ranking in Maclean’s magazine’s annual assessment of socially responsible companies, the highest ranking of any Canadian mining company at that time.
These companies exemplify efforts within the mining industry to integrate sustainable practices into their operations, aligning with global environmental and social governance standards. To get started, you’ll need to open a trading account.
Conclusion
All in all, mining as an industry is only going to scale in a different direction, not disappear entirely.
As Canada attempts to reach its net zero targets many of the technologies needed to reach those emission targets require mining. Finding a balance between environmental stewardship and the reality of climate change is a significant concern, especially given that the industry employs over half a million Canadians and contributed $148 billion of gross domestic product in 2022.
— with files from Romana King
Sources
1. Rocky Mountain Institute: Pulling the weight of heavy truck decarbonization
2. Ontario Mining Association: Social Responsibility
3. Temagami First Nation & Teme Augama Anishnabai: Consultation Protocol for Mining Activities in N’Daki Menan
4. Ontario: Glencore Canada Corporation
5. ICLG: Mining Laws and Regulations Canada 2025
6. Government of Canada: Lands and Minerals Sector – Indigenous Mining Agreements
7. ABB: White Paper: Building the all-electric mine
8. McKinsey and Company: Electrifying mines could double their electricity demand
9. Agnico Eagle: Electrification of Mining
10. American Geoscience Institute: Mining remediation in the Sudbury region of Ontario
11. Greater Sudbury: Regreening Program
11. National Resources Canada: 10 Key Facts on Canada’s Minerals Sector
This article How to invest in sustainable mining originally appeared on Money.ca
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
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