Government’s growth push puts spotlight on exploration
Experts say a stronger homegrown mineral exploration pipeline can reduce supply chain bottlenecks and help strengthen Canada’s leadership in mineral production. miguel habano via getty images
The Carney government has set ambitions for Canada to build the strongest economy in the G7 and to make mineral development and production a key driver of growth, positioning the country as a strategic supplier to allies. Industry groups say those goals depend on a robust exploration sector, where access to investment remains a persistent hurdle.
The federal government renewed the Mineral Exploration Tax Credit (METC) for two years in Budget 2025. Introduced in 2000, the credit allows individuals to claim an income tax credit on eligible exploration expenses that companies renounce to investors through flow-through shares; it has been a vital fiscal incentive for channelling high-risk, early-stage capital to grassroots exploration, according to the Prospectors & Developers Association of Canada (PDAC). Flow-through shares and the METC have helped mobilize about $750-million in exploration equity annually over the past decade, sustaining grassroots programs nationwide.
“Access to risk capital is the critical constraint for many early-stage projects, which is why renewal of the METC matters,” says Karen Rees, PDAC president. “We welcome the two-year renewal. That said, a more permanent solution would have the greatest impact by providing the certainty investors and companies need to plan multi-season exploration programs. Greater predictability will help reverse a decline in domestic grassroots exploration activity, provide Canada with a competitive advantage in attracting scarce risk capital for exploration and deliver strong economic returns.”
“Canada can advance its mineral ambitions by maintaining predictable support for grassroots exploration, improving permitting timelines from target to drill, and deepening partnerships with Indigenous communities.”
Exploration activity spans the country, with gold and other precious metals anchoring the sector and often serving as the starting point for the discovery of a broader spectrum of mineral deposits in Canada.
“Exploration programs targeting gold generate new geotechnical data, models, drill results and infrastructure hubs, which can often lead to new strategic partnerships and discovery of new critical mineral deposits,” says Ms. Rees. “Advancing these targets can boost domestic supply of materials used in batteries, semiconductors, grid equipment, transportation and defence.”
A stronger homegrown pipeline helps reduce exposure to supply chain bottlenecks, export controls and concentration risk. It also positions Canada as a reliable contributor to North American and allied supply chains amid rising geopolitical tensions over access to these minerals, she adds.
With capital formation central to advancing projects, PDAC points to its 2026 convention in Toronto as a practical venue where the investment side of exploration meets the technical side. Each March, the convention brings together investors, companies, service providers, governments and communities for deal-making, partnership building and market insight. PDAC’s Investors Exchange is one of the event’s key access points for retail and institutional investors to meet companies, ask technical questions and gather information to inform investment decisions.
“Canada can advance its mineral ambitions by maintaining predictable support for grassroots exploration, improving permitting timelines from target to drill, and deepening partnerships with Indigenous communities,” Ms. Rees says. “If we want the investment, jobs and long-term growth that come with being a mining leader, we need a strong exploration sector.”
More information about the PDAC convention at pdac.ca/convention-2026.
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