Canadian Mining Eye index sees small gain in Q3: EY

Sources available to discuss index growth

TORONTO, Dec. 6, 2016 /CNW/ - EY's Canadian Mining Eye index gained a modest 4% during Q3 2016, following a comparably larger gain of 42% in Q2. The Index's performance this year is a sharp turnaround compared to 2015.

"The gains in the last quarter were mainly due to an increase in base metal prices," says Jim MacLean, EY's Canadian Mining & Metals Leader. "The earnings are accentuated by more production, and lower all-in sustaining costs. As mining companies also start to embrace digital technologies to improve productivity, we're seeing costs come down even more."

EY's Canadian Mining Eye: Q3 2016 suggests gold prices will continue to be a safe haven asset amid global macroeconomic challenges. Some of the key commodity changes in Q3 include:

• Zinc prices rose in Q3 by 13% and are expected to gain in 2016 as it continues to operate in favorable market conditions
• Nickel prices rose 12%, following an 11% increase in Q2
• Copper prices were flat in Q3 and are expected to remain under pressure for the rest of the year

"The outlook for the Canadian mining sector is positive," says Jay Patel, EY's Mining & Metals Transactions Leader. "We're seeing considerable investment in new and pending projects – on top of a general rebound in the commodities market. The sector is in a much different place now than it was a year ago."

Special section – Q&A with Rick Howes, President & CEO of Dundee Precious Metals

EY's report also features an interview with Rick Howes, President and Founder of Dundee Precious Metals. Howes discusses strategies for embracing digital mining opportunities, as well as how innovation is leading to reinvention in the sector.

Howes told EY: "Technology is advancing to the point that we can apply it to our operations without a significant amount of investment. It has the potential to transform many aspects of our industry."

Read more about where Howes thinks digital innovation will have the biggest impact in transforming the sector, in the full interview, here.

The Canadian Mining Eye tracks Canadian mining sector performance of 100 TSX and TSXV mid-tier and junior companies with market capitalizations at the end, broadly falling between CDN$1.6b and CDN$47m.

About EY
EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities.

EY refers to the global organization and may refer to one or more of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com.

SOURCE EY (Ernst & Young)

EY's Canadian Mining & Metals team is available to offer insight into the report's findings. To reach a spokesperson, or for more info, please contact: Leigh Kjekstad, [email protected], 604 648 3807; Sasha Anopina, [email protected], 416 943 2637; Julie Fournier, [email protected], 514 874 4308