Cline structures balanced approach: tailoring the provincial government's fit to the mining industry often requires a nip here, a tuck there and an adjustment over there.

One size doesn't suit all because mining companies are not the same size, they don't want to look alike and they're not all going to the same party.

The fledgling diamond industry is drawn to exploration incentives while adjustments in royalty structures are attractive to established potash producers. Programs addressing provincial energy production get the coal industry's attention; unfettered export conditions and mutually beneficial trade relationships catch the eye of uranium companies.

Eric Cline, Minister of Saskatchewan Industry and Resources, is responsible for fashioning the government's look when it comes to mining. He sees it as his job to match initiatives with the right sectors and to ensure no part of the industry is left out in the cold.

The $12.6-million, six-year Mineral Exploration Incentive Program was introduced in September to establish an attractive environment for both prospector and exploration companies. The program includes a 10-year royalty holiday for new precious and base metal mines, a commitment to the development of a competitive diamond royalty and tax structure, and a new fuel tax rebate for certain industry activities.

"We feel these incentives will benefit base metals, diamonds, rare earth and a number of other commodities," Cline says, adding it will be a number of years before the impact of such measures can be assessed.

"I think that if you put the effort in at the front end you're more apt to find rewards down the road."

The government is also involved in discussions about tax regimes and Cline feels recent changes to corporate capital tax rates will help smaller Saskatchewan companies. But while the government is eager to clear the path for new ventures, Cline says "we don't want to forget about our established industries."

The minister points out Canada is the top producer of just two major commodities and both come from Saskatchewan. In fact, this province produces every pound of Canada's uranium and 90 per cent of its potash, the two commodities of which Cline speaks. Tension-free trade relations are crucial to the export of these and every other mineral product.

Recent disputes with the United States over softwood lumber and agricultural policies, combined with Canada's refusal to join the U.S.-led war in Iraq, have caused concern in some circles. Cline believes the advantage of dealing with a secure, stable and resource-rich country outweighs any animosity toward Canada.

"In wartime, emotions can run high but those emotions subside," he says. "Americans are very business-oriented and they realize cross-border trade is beneficial to both countries. The United States is a very important trading partner, especially for Saskatchewan and our exports of potash, uranium, and oil and gas. I'm quite confident we will move forward from this and remain the closest of friends."

Relations between Saskatchewan and the federal government also took an odd turn in 2002 when federal transfer payments were reduced by $300 million. Mining in Saskatchewan raked in 56 per cent of total profits, they said, based on just 19 per cent of production. Cline agreed mining in Saskatchewan is profitable but argued the numbers simply were not accurate.

"The cut in transfer payments was reduced to $150 million instead of the original $300 million," Cline says. "We think it was an anomalous situation and it shouldn't carry forward."

Another lingering difference between the two levels of government is the clean-up of abandoned mine sites, particularly uranium mine sites. The province is currently studying 71 sites of all types in the province and while many will require little or no action, some sites will need costly remedies.

"The abandoned uranium mines are a troubled legacy of Cold War-era policies and have no linkage to current companies' Cline says. "It is a peculiarly federal matter. Responsibility lies with the federal government but the impact is on Saskatchewan so we're hoping to arrive at a solution in the near future."

Before moving to his current portfolio Cline spent more than five years as finance minister and is quite familiar with many of the people and issues in the mining industry. Energy production from coal, oil, gas and ethanol is all under his domain. Improving all aspects of the current mining industry is a government priority.

"Mining is very big business for us in terms of the jobs it creates and we're very committed to helping it grow;' Cline says. "When you look at the big picture and how the province has managed to get a lot of other industries going along with mining you see that things are quite upbeat in Saskatchewan." SMJ