Significant Growth in Mining Payments to Ontario Indigenous Communities Over 5 Years

2021 marked an all-time high for reported payments by mining companies to Indigenous governments in Ontario. We look at the trend and the driving factors.
Arend Hoekstra, Byron Dolan
  | Analysis

2021 marked new highs for reported payments made by mining companies to Indigenous communities in Ontario.  Our analysis showed a total of $73.6 million in reported payments in 2021, an increase of 128% from payments disclosed in 2017.

Ontario IBA Payments per year.

Payments made by mining companies to Ontario Indigenous governments as disclosed in ESTMA reporting

This increase appears to be driven by new arrangements between mining companies and Indigenous communities, rather than a growth in resource shipment values.  Between 2017 and 2021, the value of mineral shipments as disclosed by NRCan increased by less than 10%.  At the same time, the implied royalty rate (measured by dividing ESTMA reported mining payments to Indigenous communities by Ontario mineral shipments as reported by NRCan) more than doubled.

Implied Royalty Rate Ontario

Ontario Indigenous community payments as a proportion of total Ontario mineral shipments.

Over the five year period there was significant growth in the number of mineral projects making payments to Indigenous communities, from 16 in 2017 to 23 in 2021.  Since Indigenous community payments (such as milestone payments) often begin in advance of resource production, it is possible that the growth in Indigenous payments as against marginal underlying growth in mineral shipments may be followed by increased mineral production in the near future.

Ontario projects making payments

The number of Ontario mineral resource projects that recorded making payments to Ontario Indigenous communities under ESTMA.



The growth in Indigenous government payments has been strong but consistent over the past few years, and has significantly outpaced underlying resource shipment values.  The growth in projects recording payments may indicate that new projects are driving the overall implied Indigenous royalty, and are doing so at amounts significant higher than those seen for legacy mines.  As agreements with Indigenous parties often include milestone payments, it is also possible that the value of Indigenous government payments have been increased by one-time payments that may not be replicated to the same degree in the future. Proponents operating in Ontario and Canada should be prepared for growing expectations around payments to Indigenous governments.

Our Approach

Our analysis is based on analyzing publicly disclosed reports made under the Extractive Sector Transparency Measures Act and the value of mineral shipments as disclosed by NRCan.

Comparing IBA Payment Amounts Across Canada

Canada’s provinces and territories are all subject to the same constitutional protections for Aboriginal and Treaty rights, yet Indigenous peoples across Canada face very different prospects when it comes to sharing in the benefits of natural resource extraction.

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