Saskatchewan has introduced a new royalty framework for the production of lithium, which marks an important step in the direction of supporting the growing role of the province in the crucial mineral sector of Canada.
The changes to the Subsurface Mineral Royalty Regulations, 2017, formally determine a crownroyalty of 3 percent on the value of the sale of brine minerals, coupled to a two -year holiday for new production capacity.
Provincial officials said that the change raises the royalties of Saskatchewan for lithium with the royalties that are already being used on potas, salt and sodium sulfate, and keeps the province competitive with leading areas of law around the world.
“Lithium is a crucial mineral that is expected to see strong demand and growth in the coming decades, and Saskatchewan is well positioned to take advantage of this opportunity,” said Energy and Resources Minister. said Colleen Young.
“By introducing this royalty framework, we offer certainty to industry, while we ensure that the population of Saskatchewan benefits from it as this sector develops,” Young added.
Participants from the industry welcomed the step and called it a clear signal that the province is planning to become a serious player in the global supply chain of Lithium.
The Canada -based explorer EMP Metals (CSE: Empps, OTCQB: EMPPF) described the rate as internationally competitive and a meaningful impulse for the project economy.
“This is very welcome news. The government of the province of Saskatchewan has again proven to support lithium production in the province,” said Karl Kottmeier, CEO of EMP Metals. “This is a very competitive royalty rate internationally, and a two -year royalty exemption on new production immediately has a positive impact on the financial modeling of what is already a convincing business case for our project Aurora Lithium production project.”
President and CEO of Grounded Lithium (TSXV: GRD), GREGG Smith, also noted that the policy encourages further investments and at the same time recognizes the high initial costs of developing processing capacity.
“This new regulatory framework offers a reasonable royalty rate and at the same time recognizes the considerable risk and initial investments that companies make in processing facilities to ultimately realize commercial production,” said Smit.
Saskatchewan has become one of Canada’s top destinations for mining investments. According to the Annual Survey of Mining Companies of the Fraser Institute, this is the most important jurisdiction of the country, whereby the province is expected to attract more than $ 7 billion in mining investments this year – more than a quarter of the total in Canada.
The lithium framework also fits in with the broader critical minerals strategy of the province, which was launched in 2023 to position Saskatchewan as an important contributor to Canada’s independence of resources and the energy transition.
The plan aims at a share of 15 percent in the national exploration of minerals by 2030, a doubling of critical mineral production and the expansion of the existing potas, uranium and helium production.
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Publication of securities: I, Giann Liguid, do not have a direct investment interest in any company mentioned in this article.
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