The key drivers of Canada’s Arctic economy: An introduction

There’s far more to the Canadian Arctic’s economy than the Northwest Passage. In the first of a series of articles, Christopher Wright gives an overview of the key industries in the country’s northernmost regions.

If Canada’s Arctic is discussed at all, it is usually in terms of its strategic value, and the role of the Northwest Passage. It is rarely recognised as the home to some 52,000 Inuit and Inuvialuit in 42 marine- and air-dependent communities. There is only one all-weather road to the Arctic, and that ends in Tuktoyaktuk in the Northwest Territories

There is also significant mining activity, currently with one high-grade iron ore mine at Mary River west of Pond Inlet; two nickel/copper mines at Deception Bay in Northern Quebec; and two gold mines respectively outside Baker Lake and Rankin Inlet. Shortly they will be joined by a third gold mine at Bathurst Inlet in the Western Arctic. Current active exploration plays with strong future prospects include very rare amber coloured diamonds, uranium, zinc/lead/silver and more gold.

Air support typically costs an order of magnitude more than marine resupply, so shipping from southern Canada and off-shore is a crucial lifeline for the communities, as well as mining operations. Climate change is materially affecting how goods are shipped, and in the western Arctic the lack of water over the Ramparts Rapids has all but closed the Mackenzie River north of Fort Good Hope to through tug and barge operations. This route has been used for northern resupply since fur trading days, and there are few readily accessible alternatives. In the east, stormy weather, and uncharacteristic ice conditions, make shipping hazardous and time consuming, given that there is only one conventional dock, opened in 2022, in Iqaluit. At all other communities, goods have to be lightered ashore, much as they were in the 19th century

Arctic Communities

There are three distinct regions to the Canadian Arctic.

• Nunavik is a predominantly Inuit region that spreads across northern Quebec and down the east shore of Hudson Bay. The region has 14 communities with a population in 2021 of 14,025 people. The principal town is Kuujjuaq, previously known as Fort Chimo.
• There are 25 communities in the Inuit homeland of Nunavut, which was created in 1999 as a new Canadian territory. At 2 million square kilometers, the geographical spread of Nunavut is enormous; from Clyde River on the East shore of Baffin Island to Kugluktuk at the western edge of the Kitikmeot region is 1,830 km. From Arviat on the south west shore of Hudson Bay, it is 1,752 km to Grise Fjord on Ellesmere Island. The regional population in 2021 was 36,858. The capital and largest town is Iqaluit, previously known as Frobisher Bay.
• In the Northwest Territories there are another three remote maritime communities, with a total population of 810 in 2021.

Mining Activity

While the Canadian Arctic has a history of mining stretching back to Martin Frobisher’s ill- conceived gold mine in 1578, current mining activity consists of Glencore’s Raglan Nickel/copper/cobalt property near Salluit, with port facilities in Deception Bay. Canadian Royalties also ships through dedicated facilities in Deception Bay, and while they also draw on the Cape Smith mineral belt, their product is much higher in copper than nickel (although there are strong showings of palladium group metals).

Agnico Eagle Mines operates two gold mines in the Kivalliq region of Nunavut. Meadowbank, which started production in 2010, is scheduled to close in 2028 once the nearby Amauruq deposit is mined out. The company’s newest mine, Meliadine, is 25 km north of Rankin Inlet and has resources to carry operations well into the 2030s. First gold was poured here in 2019. The company also owns the Hope Bay gold prospect in the Kitikmeot region, and is continuing to evaluate its complex minerology. By far the biggest and perhaps best-known mine is Baffinland Iron Ore Mines in the Qikiqtaaluk Region, which ships high grade iron ore out of their facilities at Milne inlet.

The Northwest Passage

This multi-channel route across the north of Canada was made famous by the many attempts to find a route through the Arctic to the Orient, and the loss of the last British expedition under the command of Sir John Franklin in 1845. The media has, generally, made more of the passage as a commercial route than marine logistics can support. Today, it is a popular expedition cruise route, a short cut for small project ships between the Far East and Canadian destinations. It is a challenge for small craft owners, who believe there is no longer any significant ice to be found.

Coming up in the series:

Mining and Exploration Activity

Community Resupply

Mining and Exploration Activity

The Northwest Passage

The Mackenzie River

Cruise Tourism in the Arctic

Christopher Wright is the former president of The Mariport Group Ltd, a marine and port consulting company that he formed in 1989. After retiring in 2013, Wright joined WorleyParsons Canada (now Advisian) as a marine logistics specialist.

He has written two books: “Arctic Cargo; A History of Marine Transportation in Canada’s North” (2016) and “Of Penguins and Polar Bears, a History of Coldwater Cruising” (2020).