Business in Vancouver - Issue 1299 by GLACIER MEDIA DIGITAL LIMITED PARTNERSHIP dba BUSINESS IN VANCOUVER

Beedie Development Group president Ryan Beedie on one of the keys to negotiating major deals and building successful businesses | Page 35

life lessons

executive insights for your business

Connecting People angusone.com • 604-682-8367 Daily business news K biv.com

September 23–29, 2014 | Issue 1299 | $4.00

Focus on film fest success entertainment | PAge 3

The Vancouver International Film Festival had a good year in 2013, but needs to retool its business game plan to maintain market momentum

Former daily newspaper managing editor Kirk LaPointe | richard lam

Why ex-media man wants mayor’s chair Profile | PAge 19 Kirk

LaPointe spent much of his career in the daily newspaper business helping hold political feet to the fire; now he wants to switch roles in his quest to dethrone Vision’s Gregor Robertson

Jacqueline Dupuis, VIFF’s executive director, set to open the curtain on the 33rd Vancouver International Film Festival |

richard lam

B.C. coal down but far from out Global price drop puts coal under pressure, but recovery is on the horizon; mining association CEO on New Prosperity fight; junior miners get innovative while prospecting for investment funds

Mining report | PAges 21–27

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BUSINESSVANCOUVER September 23–29, 2014

inside

development

Towering price tag

Condo skyscraper site fetches $15 million per acre

publisher President/Publisher | Paul Harris

Surrey Industrial oasis

Location helps make Campbell Heights a draw for developers

real estate Biding their time Peter Mitham on the investment property waiting game

Jonathan Manthorpe on investors’ embrace of new Asian leaders

604-608-5183 604-608-5131 604-608-5174 604-688-2398

ADVERTISING SALES Display Sales | Janice Frome, Blair Johnston, Michele MacKenzie, Rob Macquisten, Pia Tomlins

Bright future With its patented energy-saving system, Premier Lighting is one of the companies driving the rapid growth – revenues have climbed by 57% in the last three years – of B.C.’s clean-technology sector

asia pacific Banking on reform

604-608-5156

EDITORIAL Editor-in-chief | Fiona Anderson managing Editor | Timothy Renshaw Deputy managing Editor | Mark Falkenberg Staff Writers | Nelson Bennett, Emma Crawford Hampel, Glen Korstrom, Tyler Orton, Jen St. Denis editorial data researchers | Carrie Schmidt, Anna Liczmanska

reader sales & service Manager, Reader Sales & Service | Deborah Hamilton subscriber sales | Gerard Veeneman

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EVENTS Events | Paige Millar Business Development Manager | Chris Wilson

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Opinion Plane truths

Peter Ladner on the environmental impact of air travel Technology 12 Ask the Experts 13 finance 16-17 mining report 21-27

for the record 28-31 Editorial/opinion 32-33 datebook 34 Life Lessons 35

How I Did It

B.C.’s biggest mines

Elastic Path’s Harry Chemko on taking his company into the cloud

BIV’s exclusive list, ranked by mine revenue in 2013

Business in Vancouver is published by BIV Media Limited Partnership at 102 East 4th Avenue, Vancouver, BC, V5T 1G2. Telephone 604-688-2398; fax 604-688-1963. New subscriptions: one year, $99; two years, $169; three years, $219. Online only: one year, $69; daily, $4.95; monthly, $9.95. Premium package: $525. Payment required with order. All prices are subject to 5% Goods and Services Tax. #831496872. Copyright 2014. Articles may not be reprinted without permission from the publisher. Publications Mail Agreement No: 40069240. Registration No: 8876. Return undeliverable Canadian addresses to Circulation Department: 102 East 4th Avenue, Vancouver, BC, V5T 1G2. Email: subscribe@biv.com U.S. Residents: Business in Vancouver (USPS 009-409) is published weekly by BIV Media Limited Partnership. Our U.S. subscription rate is $150 Canadian per year. Payment required with order. U.S. POSTMASTER: Send address changes to Business in Vancouver, 102 East 4th Avenue, Vancouver, BC, V5T 1G2.

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BUSINESSVANCOUVER September 23–29, 2014

Film fest director hopes for hit sequel to last year’s VIFF entertainment | Programming innovations reach out to new audiences as Vancouver festival turns 33 By MARKE ANDREWS

Audiences responded better than we anticipated to the new venues, and we were able to reach some new audiences in those new neighbourhoods

news@biv.com

he Vancouver Internationa l F i l m Fes t iva l (September 25 to October 10) celebrates its 33rd birthday this year, and like many 30-somethings, it keeps looking at itself and wondering, “Do I look fat in these jeans?” And it keeps looking at itself and wondering, “How can I be better?” That is why the non-profit cultural organization (officially the Greater Vancouver International Film Festival Society) has undertaken a yearlong brainstorm of strategic planning to expand upon last year’s success to carry it into future events. “We’ve gone through an intensive stakeholder consultation and found there’s a willingness from industry and non-industry stakeholders to develop a new strategy,” said Jacqueline Dupuis, VIFF’s executive director, who succeeded Alan Franey as the event’s top dog. Franey is now the festival’s director of programming. The festival is really just one of three business units the society oversees, the other being involvement with the B.C. film industry and operating yearround programming primarily through the Vancity Theatre. Last year, VIFF enjoyed a record revenue year, buoyed by its success at five new venues including the Centre in Vancouver for Performing Arts, Rio Theatre, Vancouver Playhouse, Cineplex Odeon International Village Cinemas and the Simon Fraser University Goldcorp Centre for the Arts. VIFF expanded its education outreach program to bring young students into the theatres and launched the BC Spotlight series, which screened a dozen films by local filmmakers and presented cash prizes to pa rticipati ng artists. BC S p o t l i g h t b e c a m e t h e

[] Jacqueline Dupuis executive Director, Vancouver International Film Festival

Organizers of this year’s Vancouver International Film Festival aim to at least match last year’s recordsetting revenue, says executive director Jacqueline Dupuis | Richard Lam

Donald Trump in A Dangerous Game, playing October 3, 5 and 9 at the Vancouver International Film Festival

Shayleah Sands in Above Us All, playing October 4 and 5 at VIFF

best-attended series in festival history, with crowds averaging 80% capacity. “Audiences responded better than we anticipated to the new venues, and we were able to reach some new audiences in those new neighbourhoods,”

said Dupuis. T hose at tend i n g shows at International Village could take a short walk to the SFU theatre and another short walk to the Playhouse. In 2013, VIFF showed 341 films spread over 515 screenings, had

400 invited guests and enjoyed attendance of 130,000. That was down from 2012’s 140,000 attendance, but the festival set a box-office record despite that because of more paid admissions. This year, it will show 353 films

over 533 screenings and have the same number of guests. It remains to be seen if the festival can set another record, and Dupuis wants to be conservative, saying, “We expect to have flat revenue and attendance growth, and if we exceed our revenue and attendance target, we’ll be thrilled.” To date, advance ticket sales are slightly ahead of 2013, and sponsorship revenue is up slightly over this time last year. Dupuis became head of the festival in August, part of a threeyear transition of leadership that she and Franey embarked on. During this period, the executive team nailed down new venues and came up with new initiatives like BC Spotlight and this year’s Style in Film, a six-film series that is tied to events with Holt Renfrew and Eco Fashion Week. Both initiatives are meant to broaden the festival’s demographic reach. So, too, is the High School Outreach program. The film festival crowd tends to be older, and exposing teenagers to the festival experience lays the groundwork for future generations of festival-goers. Last year, 2,000 high school students attended matinee screenings offered by the outreach program, which also includes private and post-secondary schools. For more information about the film festival, go to viff.org. •

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BUSINESSVANCOUVER September 23–29, 2014

Vancouver residential land prices skyrocket in 2014 real estate | Developer By Frank O’Brien fobrien@biv.com

eveloper Westbank paid $32.4 million, or more than $15 million per acre, for the 2.2-acre site of its new Vancouver House residential tower. But that is not the most expensive residential land sale in Metro Vancouver thus far this year. Top-dollar prize in that category goes to the $83.5 million paid for a site measuring less than an acre on Alberni Street in Vancouver’s West End. “[Residential] land remains the most sought-after commercial real estate investment in British Columbia,” said an Avison Young mid-year report on commercial real estate sales. But one real estate commentator believes the white-hot demand for residential reveals an economic fault line, because much more is being spent building condominiums than on places for people to work or learn.

paid $15 million per acre for Vancouver House condo tower site

Residential land is clearly leading B.C.’s investment curve. In 2014’s first half, the top five residential land sales across Metro Vancouver, at a total of $255.6 million, were worth more than all of B.C.’s industrial property sales, at $163 million, and accounted for 30% of the total commercial property transactions in the province. Other notable sales of residential land, all aimed at highdensity development, include $69 million paid for 4.91 acres on No. 3 Road in Richmond and the $20.7 million sale of 1.1 acres in Burnaby’s Metrotown area. The higher land values could signal rising prices for future multi-family housing units in Metro Vancouver. The land costs for Vancouver House, for example, translate into $83,000 for each of the 388 condominiums in the twisting tower that will rise at the north end of the Granville Street Bridge. Real estate buyers pay much

less for non-residential land, the Avison Young report reveals. Metro Vancouver industrial land, for example, sold for between $1 million and $2 million per acre this year, while the biggest sale of commercially zoned land pencils out to $1.45 million per acre for a 40-acre site near Burnaby’s Brentwood SkyTrain station. “T here is something out of whack here,” said real estate consultant Ozzie Jurock, who hosted a Real Estate Outlook 2015 conference in Vancouver on September 13. Jurock noted that in 2014’s first seven months, Metro Vancouver residential permits reached $2.9 billion compared with $1.2 billion for total non-residential construction. Across the province, home building permit values are outstripping non-residential permits by a four-to-one ratio. Said Jurock: “Residential construction this far ahead of nonresidential reflects a weak pattern of business investment that could stunt economic growth.” •

$255.6m

Total value of the top five sites for housing development in Metro Vancouver in 2014

$163m

Value of all B.C.’s industrial property sales in 2014’s first half

The land value works out to $83,000 for each condominium in the new Vancouver House tower at the north end of the Granville Street Bridge | westbank

BIV.com Beyond the print hot topics

From the editor All Scottish eyes were on Scotland’s vote for independence last week. The Scots did vote to continue their 307-year union with England, leading to sighs of relief worldwide. A Washington Post opinion column leading up to the vote outlined similarities between Scotland and Russia and how national pride has made both the Russians and Scots underestimate their economic difficulties.

Court denies City of Burnaby’s request for injunction against Kinder Morgan Ottawa nips emerging medical marijuana industry in the bud Check out BIV’s new Living/ Working section, including an interview with Vancouver Whitecaps coach Carl Robinson on what it takes to be a leader

A day after NPA mayoral candidate Kirk LaPointe pledged to tackle child hunger in the city, rival Vision Vancouver promised more money for school food programs

Any eyes that weren’t on Scotland were likely on China, or matters related to China. Alibaba, the Hangzhou, Chinabased e-tailer, went public on the New York Stock Exchange (NYSE:BABA) at US$68 a share on Friday, valuing the company at US$168 billion. Shares opened on the NYSE at US$92.70. Bloomberg’s William Pesek gave three reasons to be terrified of Alibaba. And Apple’s new phones were out, but not in China, where they are made, according to Quartz. Check out these stories and more at biv.com.

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More than twice as much money is being spent on building homes in British Columbia than on all industrial, commercial and government projects combined

BIV reporter Tyler Orton talks on Global BC about telecommuters and how their productivity levels are comparable to those of other workers

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BUSINESSVANCOUVER September 23–29, 2014

Clean-tech cashes in on Hydro’s push to save power energy | Sector’s

revenue jumps 57% in three years as utilities boost customer incentives, rebates

BY Tyler Orton torton@biv.com

ust because BC Hydro is a utilities company doesn’t mean the Crown corporation wants customers racking up large bills, according to smart metering program manager Ken Bell. Facing a potential $8 billion price tag to fund the Site C Dam, BC Hydro has been pushing for smaller tech solutions to reduce power consumption throughout the province. “That is the best form of managing electricity on our end as well because it ultimately means people are using less of our product, which is ultimately what we want to do so we don’t have to find new sources of generation,” Bell told Business in Vancouver. And B.C. businesses have been quick to capitalize on the growing market for energy-efficient technologies. In 2011, B.C.’s clean-tech sector generated an estimated $2.5 billion in revenue, according to a KPMG report. That’s a 57% increase from the $1.6 billion generated by the industry in 2008. Meanwhile, 68% of the 202 B.C. firms surveyed were established in the past decade.

“The push to get more efficient has been going on … ever since Edison invented the incandescent lamp,” said Tony Holland, president of Burnaby’s Premier Lighting. In July, Premier Lighting installed a newly patented lighting system in the underground parking garage of the Vancouver Public Library’s (VPL) main branch. The integrated system uses motion sensors to guide vehicles to vacant stalls, while the LED lights turn on only when the sensors detect vehicles or pedestrians. The lights are powered about 75% of the time, and BC Hydro estimated the project would reduce the library’s energy costs by about $31,000 a year. Holland said the VPL launch was successful enough that the City of Vancouver requested estimates for another 20 parking garages. Although Premier Lighting has been around for three decades, Rainforest Automation Inc. is among the clean-tech firms established in the past 10 years. The North Vancouver company has developed household devices that wirelessly link up to smart meters to monitor energy consumption in real time.

Tony Holland’s Premier Lighting has installed its energy-saving light technology in the Vancouver Public Library’s parking lot | Richard Lam

“What people have seen for many years is their historical usage on their bill,” Rainforest president Chris Tumpach said. “It’s kind of like photo radar. You get a speeding ticket in the mail and you’re like, ‘Oh, wow. I guess I was speeding that day.’” H e a d d e d t h a t r e a l-t i m e mon itor i ng a l lows people to ident i f y p ower-le ach i ng

appliances immediately and adjust consumption. Rainforest began selling its products to utilities providers in Texas and California in 2009 but only entered the B.C. market this year. Tumpach said because energy costs are so much higher in those two states, providers south of the border had an incentive to

$2.5B

Estimated revenue generated in B.C.’s clean-tech sector in 2011

$1.6B

Estimated revenue generated in B.C.’s clean-tech sector in 2008

68%

Percentage of B.C. clean-tech companies surveyed in a KPMG report that were established in the past decade

implement smart meter programs much sooner than in B.C. But Rainforest and BC Hydro came to an agreement earlier this year whereby the utilities company would provide users with a rebate on the devices. Tumpach said many of the providers in the U.S., where about 95% of Rainforest’s clients are, provide the devices to customers for free. No matter the arrangement, he said Rainforest is benefiting directly from incentives utilities companies are pushing on customers. •

Meet MNP’s New Regional Managing Partner, Mackenzie Kyle At MNP, our business solutions are as strong as the team behind them. That’s why we have the best professionals in place to meet your business needs. MNP is pleased to announce that Mackenzie Kyle has assumed the role of Regional Managing Partner in Vancouver, as well as continuing his current role of Regional Managing Partner, BC Advisory. An accomplished leader, Mackenzie shares MNP’s passion for business and entrepreneurship and an unwavering commitment to our clients. Leading and working closely with MNP’s Assurance, Tax and Advisory teams, Mackenzie will ensure we continue to meet our clients’ growing needs. MNP is one of the fastest growing accounting and business consulting firms in Canada with 16 offices across B.C. Contact Mackenzie Kyle, Regional Managing Partner at 604.637.1596 or mackenzie.kyle@mnp.ca

BUSINESSVANCOUVER September 23–29, 2014

NEWS

Politics

City of Vancouver paid communications staff more than $1.6 million in 2013 salaries The City of Vancouver paid more than $1.6 million to 33 people in its communications department in 2013, according to city hall pay records released through a Freedom of Information request by CityHallWatch and provided to Business in Vancouver. Almost two dozen employees received less than $75,000, for a total of $798,407.34. Ten communications directors earned $75,000 or more. That list, totalling $845,504.32, was topped by Tracy Vaughan ($97,415.98) and Mairi Welman, who quit in summer

2013 to join District of North Vancouver ($131,354.37). The city releases its list of personnel paid $75,000 and up within its statement of financial information. It does not publish the list of those who earn less than $75,000, a list that includes political appointees in the Office of the Mayor. It took nearly nine months, including a complaint to the Office of the Information and Privacy Commissioner, for CityHallWatch to receive the information.

Kevin Quinlan, the mayor’s top policy and communications aide, was paid $66,305.92 in 2012 plus $3,148.19 in expenses. He got

a raise in 2013 to $72,655.86 plus $6,324.65 expenses. Joining the mayor’s office as a media staffer in spring 2012 was Braeden Caley, who was paid $44,111.17 that year. Caley received $68,445.50 salary and $1,149.01 expenses for the full year in 2013. Mayor Gregor Robertson’s now-retired executive secretary, Alison Abu-Arisheh, was paid $69,784.73, and his director of community relations, Lara Honrado, was paid $68,460.45 last year.

Agriculture

Oil and Gas

British Columbians show strong support for ALR: study

Court denies Burnaby’s request for injuction against Kinder Morgan

The majority of B.C. residents feel that the Agricultural Land Reserve (ALR) is important, says a new study released by the Vancouver Foundation and the Real Estate Foundation of BC. The study found that 76% of British Columbians agree or agree strongly that the ALR is vital in protecting valleys and green space for wildlife and recreation. Almost the same amount of respondents (73%) said that the ALR is essential in protecting food security and the economy in this province. Seventy-one per cent of those surveyed said that laws should be tightened to protect the ALR.

“This study demonstrates that British Columbians believe strongly in safeguarding our farms and green spaces to ensure long-term health, well-being and resilience in our communities,” said Vancouver Foundation CEO Kevin McCort. “The Agricultural Land Reserve is a vital public asset contributing to our ability to reliably produce fresh food, preserve local farmland and freshwater supplies and to support local B.C. farmers and ranchers.” Respondents said that land-use priorities should include natural freshwater systems (83%) and farming and growing food (81%).

The British Columbia Supreme Court has rejected the City of Burnaby’s request for a temporary injunction to stop Kinder Morgan’s survey work on Burnaby Mountain. Justice Brenda Brown issued her decision September 17. “We are disappointed,” said Gregory McDade, the city’s lawyer. “We do believe this belongs in BC Supreme Court and not before the National Energy Board.” The city has argued Kinder Morgan broke a local bylaw by cutting trees in a city park, while the company believes

it has the right to do the work, based on the National Energy Board Act. Burnaby was seeking two injunctions – one temporary and one permanent – to stop the company from further cutting in the conservation area. Brown’s decision affects only the request for a temporary injunction, which was meant to stop the company’s work, while the court dealt with the larger issue at play: can the federal government override local bylaws? “No one has declared the bylaws invalid,” McDade added. “This now refocuses attention on the NEB.” – Burnaby Now

K biv.com Go online to read these stories in full, along with much more business news updated daily at biv.com.

Read ‘em and reap. Our latest reports focus on key strategies for creating new opportunities for growth. At Grant Thornton LLP, we’re well aware of the current market challenges facing miners. But there’s good news. Industry executives and suppliers are expecting the sector to bounce back. And they believe a key strategy for achieving recovery and growth is through mergers and acquisitions (M&A). To learn how your company can find new opportunities for growth and become part of the industry upswing, take a look at our latest reports. Our Canadian summary The Top Five Drivers of M&A and our international study Gaining Momentum— the Resurgence of M&A are now available at www.GrantThornton.ca/MininginCanada. Vancouver | Suite 1600, Grant Thornton Place | 333 Seymour Street | V6B 0A4 | T +1 604 687 2711 Ron McArthur | Markets Leader | T +1 604 443 2128 | E Ron.McArthur@ca.gt.com

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NEWS

BUSINESSVANCOUVER September 23–29, 2014

Politics

Price gap freezing mid-level homeowners in place Sales of homes priced at more than $1.1 million soared 18% in Vancouver this year while sales of homes priced between $300,000 and $500,000 eked out a mere 0.5% increase, according to a study by CIBC World Markets. And it is not only Vancouver that is seeing a yawning gap between lower-priced homes and higher-priced ones. Sales of homes priced at $1 million or more soared 34% in both Vancouver and Toronto and were up 17% in Calgary and 11% in Montreal in the first half of this year. Metro Vancouver sales worth more than $1 million increased to 1,664 units for condominiums, attached and detached single-family homes combined, 34% more than the units sold in the first six months of 2013. Most of the $1 million-plus sales

were detached houses, with 1,317 units – but there has been a “significant increase” in sales of townhomes and condos priced at over $1 million as well, according to Ross McCredie, president and CEO of Sotheby’s International Realty Canada, in its annual Top Tier Real Estate Report. CIBC cautions that the runaway housing prices will force more first-time buyers out of the market and freeze many mid-value home owners in place. “Regardless of what your starting point is, the desired move-up target is getting further and further out of reach,” said CIBC analyst Benjamin Tal. But the higher-end housing market appears to have strong legs. “We expect Canada’s high-end housing market to see consistent growth through to early 2015,” said McCredie.

environment

Personal Finance

B.C. resumes carbon offset purchases

Men more confident than women when it comes to investing, study finds

The B.C. government is back in the carbon offsets purchasing game, a little over a year after it announced it would dissolve the controversial Pacific Carbon Trust (PCT). The B.C. government issued a procurement call September 11 to fund private enterprise projects that reduce greenhouse gas emissions through carbon offsets. Under the program, the government will invest in projects such as tree planting or fuel switching, if the proponent can demonstrate it will reduce greenhouse gases. The buying and selling of carbon

offsets was previously done by the PCT, a Crown corporation set up in 2008. In 2013, after a core review, the government announced it would dissolve the PCT and bring the buying and selling of offsets in-house. B.C.’s carbon-trading scheme was criticized as being both ineffective in reducing greenhouse gases and questionable in the way it raised money and funded some projects. The government gets almost all of its money to buy offsets from public bodies – such as school districts, hospitals and municipalities – not large industrial polluters.

Women may have come a long way, but when it comes to financial portfolios, it seems that men feel a lot more comfortable making decisions about the directions of their investments. In British Columbia, 63% of women feel confident when making investment decisions, according to a BMO InvestorLine survey. This is a full 20 percentage points lower than the 83% of men who feel the same way. B.C. women are also less confident than women nationally, where 68% feel sure of themselves when making these decisions. The national average for men was the same as

K biv.com Go online to read these stories in full, along with much more business news updated daily at biv.com.

in B.C. “Women currently control one-third of all wealth in North America and this is increasing by 8% annually,” said Julie Barker-Merz, president of BMO InvestorLine. “We need to adjust our thinking accordingly.” According to the study, the No. 1 reason (83%) for women’s lack of investment confidence is that investing has traditionally been viewed as “men’s work.” As well, almost half of respondents – 48% – felt that women are “intimidated” by investing.

BUSINESSVANCOUVER September 23–29, 2014

NEWS

B.C. teachers and businesses seize upon social media to push their messages communications | Facebook

and Twitter have been valuable tools in rallying public and private support

Move people from poverty to possibility

Spence Pentlands’ Yinstill Reproductive Wellness is one of approximately 200 companies named on a Facebook page dedicated to B.C. businesses that have expressed public support for teachers | Richard Lam By Janet Steffenhagen news@biv.com

Goldcorp and United Way help children get the best start in life by moving families out of poverty. Join us and help make this possible. We are possibility. uwlm.ca

hen the BC Teachers’ Fe derat ion ( BC T F ) reached a tentative deal with the government on September 16 toward ending the three-month teachers’ strike, it did what any student would do – it tweeted the news. It’s just one of ma ny ways teachers, their supporters and detractors and the government have been using social media to get their message across. While on strike, the teachers created a Facebook page identifying about 200 businesses that have publicly expressed appreciation for teachers and – in some cases – offered them discounts on a range of goods and services, such as groceries, restaurant meals, acupuncture, yoga, art classes, kickboxing, shoe repairs and haircuts. The page links to a map of the province showing the location of supportive businesses and urging teachers, family and friends to pay them a visit. Teacher Yvette Dabbs, who helped create the Facebook post, described it as “a page of positive action” on behalf of more than 40,000 public school teachers who have been on strike since mid-June. Yinstill Reproductive Wellness is one of the companies listed because it is offering free stress acupuncture treatments for teachers and support staff until the strike

ends. Clinical director Spence Pentland said the feedback has been excellent, although few have requested treatment. “This isn’t meant to be a political stance,” he said. “We just want to support people in need.” At the same time, other teachers are targeting businesses they deem to be unfriendly. In particular, they’re taking aim at members of the Coalition of BC Businesses, which recently won intervener status in a crucial court battle over class size and composition. The coalition is backing the government’s appeal of a BC Supreme Court ruling that restored the BCTF’s right to bargain class size and composition, saying that decision could cost the province millions of dollars. “The Coalition of BC Businesses is compelled to stand up for the 50,000 employers and 500,000 employees we represent,” chairman Mark von Schellwitz states in a release on the coalition’s website. “If the ruling is allowed to stand, our government will be required to either raise taxes, return to deficit spending or cut vital social services. This will reduce British Columbia’s competitiveness and will have a negative impact on our economy and on the employers and employees we represent.” The B.C. Court of Appeal granted the coalition limited intervener status this month, saying the perspective of small and medium-sized businesses may be of assistance when the court

hears the case next month. That sparked an outcry on social media, with teachers and their supporters distributing a list of coalition members and calling for a boycott of their businesses. “I won’t support companies that engage in this interference,” one teacher posted on Twitter. Another sent messages to individual businesses asking: “Why should you have a say in public classroom learning conditions? Please explain.” As well, almost 2,000 people had signed a petition as of last week saying they would blacklist all member businesses unless the coalition drops its plan. Such pressure prompted several businesses to deny any tie to the initiative. White Spot, for example, posted a statement September 14 on Facebook stating it is not a member of the coalition, although it is a member of Restaurants Canada, which is part of the coalition. “We want our valued guests to know that White Spot has not had – and will not have – any involvement in the Coalition of BC Business’s application for intervener status in the upcoming appeal. … These are complex and difficult issues that are far beyond our scope. The focus of White Spot staff and management remains on running our award-winning restaurants.” The Oak Bay Beach Hotel in Victoria issued a similar statement. The BCTF said it isn’t involved in either campaign. •

BUSINESSVANCOUVER September 23–29, 2014

Surrey Campbell Heights an industrial oasis for developers real estate | Central

Metro Vancouver location, key transportation links lure industrial tenants

By Glen Korstrom gkorstrom@biv.com

Delta Port

YVR HWY 99 HW Y 17 RICHMOND HWY 91

Delta

th 16

HWY 15 (176th Street)

Campbell Heights Hopewell Development

Avison Young vice-president Michael Farrell has been active brokering transactions in Surrey’s Campbell Heights neighbourhood

acres are being rezoned, serviced and sold by Surrey City Development Corp. Companies such as furniture manufacturer Corporate Images, sheet-metal cutter Tri-Metal Fabricators and calendar printer Linmark Publishing were some of the first to move to Campbell Heights, in the early 2000s. Others followed, and developers such as Beedie Development Group (BDG) ambitiously bought land and built ever-larger buildings. “We’ve built about six buildings in the past six years,” said Todd Yuen, who is president of BDG’s industrial division. “They’ve ranged in size from about 40,000 square feet to 100,000 square feet.” Beedie still has nearly 50 acres of undeveloped land in the area and has submitted a development application to the city for projects on 15 of those acres, Yuen said. L oblaw Compa n ies Ltd. i s

e Av

nue

H W Y 99

32 Ave

urrey’s attractiveness as a fast-growing city with strong transportation links and a relatively central location within Metro Vancouver is luring industrial tenants to its Campbell Heights neighbourhood. The most recent major transaction in that area is Hopewell Development agreeing to buy 38 acres of agricultural land from a private farmer. Hopewell’s executive vicepresident, Murray DeGirolamo, told Business in Vancouver that the corporation has reached a “firm” deal to buy the land. Closing the transaction is contingent on the City of Surrey agreeing to rezone the land for industrial use. Hopewell will have a development permit application in the works in tandem with its rezoning application so that once rezoning happens – likely by mid-2015 – construction can start immediately, DeGirolamo said. Occupancy in the first of four 200,000-square-foot buildings would then be possible by spring 2016. “T he property is currently zoned agricultural but is not in the Agricultural Land Reserve,” DeGirolamo explained. “It’s dedicated in Surrey’s official community plan as industrial, so there’s just a process that we have to go through.” When B.C.’s then-NDP government created the land reserve in 1972, Surrey successfully lobbied to exclude the 1,900-acre Campbell Heights region, arguing it needed the land for future growth, including the development of light industry. So far, only 250 acres have been developed while another 250

192nd Street

LANGLEY

Calgary’s Hopewell Development has agreed to buy 38 acres in Surrey’s Campbell Heights – as long as the city approves rezoning the land | Avison Young Commercial Real Estate (BC) Inc. and Waite Air Photos Inc.

The Hopewell Distribution Centre is the largest speculative development ever to be built in the Lower Mainland

[] Murray DeGirolamo Executive Vice-president, hopewell development

the largest tenant in Campbell Heights, operating a custombuilt 420,000-square-foot western Canadian distribution centre. Other businesses in the area that occupy more than 100,000 square feet include OK Tire, Advanced Wire Products and Tulsa Winch Group, said Avison Young

vice-president Michael Farrell. “These warehouses don’t just service the city of Surrey,” Farrell said. “They’re built on a larger scale than that. The U.S. border is immediately to the south – you’re almost on the border. So, if you’re bringing product to and from the U.S., it’s very convenient.” Hopewell’s multi-phase plan is to build four buildings that are each about 200,000 square feet, although larger buildings are possible if a tenant wants to have a custom-built massive warehouse. “It’s been a habitual issue in Vancouver that land supply is constrained,” DeGirolamo said. “So, for a developer looking for a greenfield development site of scale, to find 38 acres in Metro Vancouver is next to impossible.”

He believes he will have little problem finding tenants because there is continual pressure for tenants to move east, spurred by lower lease rates and more available options. Hopewell is one of Canada’s largest developers, having developed and sold more than 14 million square feet of space since it was founded 19 years ago. Its biggest project in Metro Vancouver is its Hopewell Distribution Centre in East Richmond – a four-phase development that is now 80% complete and will eventually have about 1.68 million square feet. “The Hopewell Distribution Centre is the largest speculative development ever to be built in the Lower Mainland,” DeGirolamo said. •

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BUSINESSVANCOUVER September 23–29, 2014

realestate Housing market | Canadian home sales climb higher in August 1.8%

Percentage by which national home sales rose from July to August, according to statistics

released by the Canadian Real Estate Association

2.1%

Percentage by which actual (as opposed to seasonally adjusted) sales activity rose

compared with August 2013 levels

1.2%

Percentage by which the number of newly listed homes fell from July to August

5.3%

Percentage by which the MLS Home Price Index rose compared with August 2013

5.3%

Percentage by which the national average sale price rose compared with August 2013 Source: Canadian Real Estate Association

Avison Young tracks, attracts investment; brakes could soon be applied to real estate’s low interest rate ride

real estate roundup Peter Mitham

Sell now, buy later Panellists at last week’s meeting of the commercial real estate association NAIOP discussed the outlook for investment real estate, but Avison Young served up a foretaste in its review of deals done in the first half of 2014. The aggregate sum of investment transactions valued at $5 million or more in the province in the first six months of this year was $852 million, the thirdhighest tally since 2002. But the actual volume of transactions was middling – just 56, well above the tally of 45 set in 2010 yet short of the record firsthalf volume of 60 transactions logged in 2012 (the first halves of 2010 and 2012 both logged more

How to grow your business

than $1 billion in investment transactions). “You are seeing very stable velocity,” observed Mark Rose, CEO of Avison Young, who deems Vancouver “one of the top cities in Canada, in one of the top countries in the world, in which to be in real estate.” But he also noted that many buyers were holding off in anticipation of better buying opportunities ahead, a phenomenon hinted at in the report itself. “The first half of 2014 was characterized more by what was not sold versus what was,” it stated. The largest transactions included a half-interest in the famed Telus “Boot” at 3777 Kingsway in Burnaby, for $86.9 million, and the purchase of 1444 Alberni and 740 Nicola Street in Vancouver for a total of $83.5 million. But the sale of 1500 West Georgia Street, at $120 million, which didn’t occur until the second half of the year, stands to have few contenders for the year’s largest deal. “Big deals are going to be fewer and farther between,” he said. “I

do believe we are at a short-term pricing top.” Rose expects the next wave of transactions will occur when interest rates start to rise and some over-leveraged owners are forced to sell while others find buyers can’t pay what they used to. “I think we are waiting on a legion of investors who are waiting to get in at slightly better pricing,” he said. Poised for growth While tracking the investments of others, Avison Young recently attracted a second infusion of capital from Vancouver-based Tricor Pacific Capital Inc. During a visit to Vancouver for Avison Young’s annual general meeting, CEO Rose noted that the brokerage has grown to 1,700 people from 293 across 43 offices since 2011. Revenue makes it a “multi, multi $100 million company,” Rose said (because Avison Young is private, exact revenue isn’t disclosed). The growth bears out hopes Tricor harboured for the company when it made its initial

investment of $40 million in 2011, a sum that combined with $10 million from Avison Young’s partners to fuel growth across the U.S. and into the U.K. and Germany. “What we hope we’re doing is creating Canada’s next significant success story in the real estate business,” Rod Senft, managing director of Tricor said at the time, adding that he hoped the brokerage would maintain its Canadian identity in the process. With close to 700 attendees at its annual general meeting in Vancouver, an event Rose framed as a way to showcase the company’s roots to its growing international team, the company’s roots aren’t likely to be forgotten by participants. Tricor remains a minority partner in Avison Young, which is owned primarily by its partners. Investors not alone Avison Young may feel rising interest rates will prompt a repricing of investment real estate, but low interest rates continue to support housing

activity and affordability for residential purchasers. Gregory Klump, chief economist with the Canadian Real Estate Association, attributes relatively strong national housing sales figures this summer to deferred activity and a decline in interest rates. However, he expects the boost to be short-lived. Indeed, the latest RBC Economics Research housing affordability survey notes that lower interest rates can have a disproportionate impact on activity in high-priced markets like Vancouver and mask ongoing disadvantages for buyers. RBC dourly notes that while Vancouver housing affordability improved significantly in the second quarter, it “still stresses homebuyers.” Small wonder, then, that RBC reports that resales continue “to be more than 6% below the 10-year average,” while Real Estate Board of Greater Vancouver statistics indicate that resales in August lagged behind those in July by 9.5%. pmitham@telus.net

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BUSINESSVANCOUVER September 23–29, 2014

technology Demystifying the Internet’s massive and rapidly multiplying domain name industry

Small-Business Builder Cybele Negris

he commercial domain name industry has been around since the 1990s, but many people may be unaware of what goes on behind the scenes. There are some people who believe that the Internet revolves around .com, and most people are unaware of the numerous players involved when they type someone’s website address in their Internet browser. Similar to other industries, the domain industry has suppliers, wholesalers, retailers and resellers. The presence of multiple specialized organizations creates a robust, competitive domain name marketplace. To shed some light on the domain name industry, here is some information on what goes on behind the scenes. Inside ICANN The domain name industry has its own oversight body. Founded in 1998, the non-profit Internet Corporation for Assigned Names and Numbers (ICANN) co-ordinates the global domain name system and assists in creating policies to maintain the Internet’s stability. ICANN’s Internet Assigned Numbers Authority (IANA) is responsible for managing the root of the Domain Name System (DNS) and the numbering system for Internet Protocol

(IP) addresses. Before ICANN was created, IANA was managed principally by Jon Postel at the Information Sciences Institute under a U.S. government contract. Today ICANN operates under a “multi-stakeholder model” with an elected board from around the world. Registries and registrars Two types of organizations are responsible for getting domain names into the hands of endusers: registries and registrars. A registry is responsible for managing a top-level domain, or TLD (what you see after the “dot”). Each registry maintains an official list of the registered domains under a TLD, together with technical DNS information (the zone file) and registrant contact information (the Whois database). Until recently, a registry would manage one or perhaps a handful of domain extensions. However, with the recent launch of many new top-level domains, some registries are responsible for hundreds. For example, Verisign is the current registry for .com and .net as well as .name and two country code TLDs (.tv and .cc). Donuts is a registry that has applied for 300 new domain extensions, and by the end of July 2014 it had already launched 139 new domains such as .discount, .expert, .coffee, .technology, .singles and .land. A registry may also operate its TLD directly, or it may engage a third party, known as a back-end operator, to assist it. A back-end operator can provide the necessary technical infrastructure, allowing the registry to concentrate on other important areas such as

The domain name industry is overseen by the non-profit Internet Corporation for Assigned Names and Numbers

marketing. For example, the .club registry Famous Four Media (.trade, .bid and .webcam) and others use Neustar as the back-end registry operator. Neustar has been the backend registry operator for .biz, .tel, .co, .us and a number of other domains for many years. With more than a thousand new domain extensions being launched, various new registries are flocking toward backend operators to assist them. A registrar handles the retail component of domain names and works with registries and back-end operators to deliver domain names to end-users. Registrars may also engage resellers to reach as many potential customers as possible. Additionally, registrars may offer services such as web hosting, email, digital security certificates and privacy services.

Getting the domain name into your hands To create a seamless experience for end-users, registries and registrars communicate and work closely with one another. Systems are integrated via application programming interfaces (APIs) to ensure that finding and registering a domain name can be done in real time. For example, Webnames.ca works with numerous registries to offer different domain extensions to everyone. When someone wants to register a .ca domain, it communicates with the Canadian Internet Registration Authority (CIRA), which operates the .ca registry, to secure that domain name for the customer. Its system synchronizes with CIRA’s to determine whether a domain name is still available and registers the domain name on a customer’s

behalf. Domains are registered annually for up to 10 years for most extensions. If you want a website or email addresses to go with the domain name, you will need to buy those services separately. Webnames.ca offers certain packages that provide the end-user with web hosting, an email address and a free domain name, so finding such a package is the most affordable way to go. • (See demystifying the domain name industry graphic at biv. com.) Cybele Negris (cybele@webnames. ca) is president, CEO and co-founder of Webnames.ca, Canada’s original .ca registrar. She serves on the boards of Small Business BC, the Small Business Roundtable of BC, Capilano University and the Capilano University Foundation.

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BUSINESSVANCOUVER September 23–29, 2014

askthe experts

Successful rebranding requires strong vision

QUESTION | My

company is undergoing rebranding. What are some of the challenges I should be aware of as it gets underway?

CHRIS CATLIFF | CEO, BlueShore Financial

aving overseen the rebranding of a credit union with a 70-year history, I can assure you that it can be hugely daunting but rewarding. Here are four things we learned: Start with a strong vision Establishing BlueShore Financial as a premium financial boutique for the affluent market has been a decade-long process that started with a well-articulated vision. We have refreshed tactics over the past 10 years, but the essence of our business strategy has remained constant. Trust your people Successful rebranding requires total commitment of your staff. We have communicated relentlessly with our employees to ensure they understand and embrace our brand. Do your homework When we adopted our new operating name one year ago, it was the culmination of three years of hard work. We acquired 40 domain names while keeping it quiet, so our new operating name wouldn’t leak out early.

Launch with confidence When given the choice of unveiling our new operating name gradually or all at once, we chose a dramatic launch. On September 30, 2013, we “flipped the switch” across all our delivery channels – branches, call centre, ATMs, online and mobile banking. The BlueShore Financial brand was live on all our communications channels.

LIBERTY LEE | Senior director, Citizen Relations PR firm

rebrand is an exciting time – a chance to breathe new life, energy and enthusiasm into what you offer. Having worked with a multitude of partners through this experience, from universities to lingerie brands, I can offer a few key things to remember along the way. Build your internal advocates early Ensure you take key internal folks on the journey with you. This means letting them know it’s on the horizon, engaging them in the research and testing, and then ensuring they’re the first to preview it before the public. Spread the word, but don’t expect people to care Some of the biggest rebrands have taken place without discussion. While a new look is news to you, your consumers may not care, and that’s OK. To maximize your return, ensure you share the news with key stakeholders, and also consider an integrated PR and marketing campaign that resonates with your consumers. Earned media can be extremely beneficial and gives your new brand a persuasive third-party endorsement. Prepare for the worst, expect the best There’s bound to be dissidence. Know what to listen to and what to ignore. If key internal stakeholders are not buying into it, that’s important. One irate consumer is perhaps not. Monitor the resulting discussion, and have position statements on hand for when needed.

DEREK SHORKEY | Managing partner, Dare Vancouver

hether new, old or “renovated,” one of the most significant elements of a brand is its ability to deliver authenticity. Is it true to itself and to constituents? Take a moment to conjure your thoughts about strong brands. For most people, names such as Apple, CocaCola, Nike or Chevrolet come to mind. These are brands that, through long histories and corporate evolution, have stayed genuine in all that they are and in their commitment to constituents. Or they have paid the price when they didn’t. A decision to rebrand is typically based on a need to better reflect a company’s offering or to update and redefine perceptions around it. Try to leave the baggage behind without losing sight of existing equity a brand may hold. It’s critical that trust and loyalty are retained, as these are the cornerstones of any relationship in the human realm – including between brand and consumer. The digital era also brings along some watch-outs. Although technology has not fundamentally changed brands, the Internet, social media and mobile provide more platforms and channels for interaction. This new “cyberhood” provides important points of interaction for your brand. While we used to focus on key areas of influence, point of purchase and point of consumption, there are constantly emerging points of conversation and points of consideration. Technology and new media allow us to be there at precise times and in myriad environments, but the messaging and manner of engagement still need to be right.

Next week’s question – I’m looking to hire some top executives for my company, but I’ve heard the city is experiencing a talent crunch. What should I know before expanding my search beyond Vancouver? Comments curated by BIV news staff | Have a question for the Experts? Email: news@biv.com

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BUSINESSVANCOUVER September 23–29, 2014

AsiaPacific Investors bank on new crop of reformist Asian leaders

Asian outlook JOnathan Manthorpe

Pakistan, which often seems to be in the grip of almost total political and social disarray, has seen a 36.88% rise in the Karachi stock market index in the past year

s more and more Asian countries make the transition to full-fledged democracies, stock market investors are paying much more attention to the reformist credentials of the government leaders than they are to the nations’ underlying assets. The phenomenon has been evident for some years but is especially noticeable since the United States-instigated financial meltdown of 2008 reminded the world of the importance of governments pursuing appropriate regulation, sound oversight and transparent systems. The personality-driven nature of this trend features sustained bounces in stock market value directly associated with incoming government leaders who have won elections on the promise of economic reform, the removal of distorting subsidies, the dismantling of the influence of special interests and the promotion of free trade. So in recent months and years there has been dramatic

Like other recently elected leaders in Southeast Asia, Indian Prime Minister Narendra Modi was voted into office on promises of reforming a corrupt and inefficient economy | Nisarg Lakhmani, Shutterstock

stock market action fuelled by enthusiasm for the reformist platforms of Shinzo Abe in Japan, Joko Widodo in Indonesia, Narendra Modi in India and Benigno Aquino in the Philippines. But perhaps the most extraordinary example of this phenomenon is that Pakistan, which often seems to be in the

grip of almost total political and social disarray, has seen a 36.88% rise in the Karachi stock market index in the past year. Indeed, there has been a steady rise in equity value since Prime Minister Nawaz Sharif was elected in June last year on pledges to push basic economic reforms, including the privatization of state-owned

companies, tighter budget discipline and higher government revenue through a broadening of the tax base. The stock market rise has been just as dramatic in neighbouring India, where it has risen 39.6% in the last 12 months, much of that since Modi was elected prime minister in May on promises of reigniting the

country’s economy. Investor exuberance hit Indonesia’s stock market composite index from the beginning of this year when it seemed certain the popular governor of Jakarta would run for the presidency and win, as he did in July elections. The index has risen 22.4% since January on the expectation that Widodo, who is universally known as “Jokowi,” will repeat his performance as chief administrator of Jakarta and unravel the tangle of entrenched special interests, ineffectual government, contorted treatment of foreign investment and distorted demands on the national budget. The markets are probably expecting too much of Jokowi, and they have not been kind to other Asian leaders who failed to live up to their promise. The flame-out of Japan’s charismatic and often eccentric leader Junichiro Koizumi, prime minister from 2001 to 2006, is a good example of the market punishing non-performance. In contrast, the market reception for Abe, who started a second spell as Japan’s prime minister in December 2012, remains steadily confident. The Tokyo exchange had been on a steady decline until Abe returned to power with a clearly laid-out program for structural reform of Japan’s economy. The index has risen 13.03% in the last 12 months. For decades the Philippines has failed to keep pace with other emerging Asian “tiger” economies, despite having one of the region’s best-educated and skilled populations. That began to change with the election of Benigno Aquino to the presidency in June 2010, on a promise to clean up the country’s stultifying national debt and its corruption-riddled

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BUSINESSVANCOUVER September 23–29, 2014

AUSTRALIA

PAKISTAN

MALAYSIA

NORTH KOREA

JAPAN

Housing is second-costliest

Gas price deal reached

PM defends GST plan

Rights record praised

58,820 over 100

When measured against income and rents, Australian home prices are the second most expensive in the world, according to a new report from the Bank for International Settlements. In overall cost of housing, Australia comes second only to Norway and just ahead of the United Kingdom and Sweden. On a graph showing housing costs relative to income, Australia comes just behind Belgium and on the same line as Canada and New Zealand. In terms of the relationship between buying a home and the cost of renting, Australia comes fourth behind Sweden, Canada and Norway.

Pakistan has agreed to a pricing formula for importing natural gas from India, a significant advance in confidence-building measures between the two nuclear-armed rivals who have fought four wars since 1947. In 2012 India offered to export up to five million cubic metres of gas a day to Pakistan through a 100-kilometre pipeline being built between Jalandhar in India to Wagah, just east of Lahore in Pakistan. The deal stalled over failure to agree on a price. The agreement is seen as preparing the ground for an agreement by which India will import gas from Turkmenistan by pipeline across Afghanistan and Pakistan.

Malaysian Prime Minister Najib Razak says he intends to bring in a broad-based goods and services tax next year, despite significant public opposition. The government, based in Putrajaya outside Kuala Lumpur, says the 6% tax will be introduced on April 1 next year and will replace the existing sales and services tax system. Economists say the move will help trim the country’s high debt-togross-national-product ratio. Najib says the tax is necessary to broaden the government’s revenue base. Only one in 10 Malaysians pays personal income tax, and more than 40% of government revenues comes from dwindling oil and gas resources.

North Korea has published its assessment of its own human rights record. The report says the record of the Pyongyang regime of leader Kim Jong-un is stellar, focusing on making the rights and interests of its people a top priority, and upholding citizens’ right to freedom of assembly and religion. The report was in response to the United Nations Commission of Inquiry on Human Rights in North Korea recommendation that Kim be brought to trial at the International Criminal Court for his abuses, and came the day after a U.S. tourist, Matthew Miller, was sentenced to six years in prison for attempting to investigate the country’s human rights practices.

Japan now has 58,820 centenarians, the world’s largest proportion of people over 100 years old relative to the country’s population. Largely because of diet, lifestyle and improvements in the delivery of health care, Japan has 46.21 centenarians for every 100,000 people, compared with Canada, where there were 17.4 people over 100 per 100,000 population in 2011. Japan now has the world’s oldest woman – 116-year-old Misao Okawa – and the world’s oldest man – 111-yearold Sakari Momoi. Japan ranks near the top of average life expectancy: 86.61 years for women and 80.21 for men. Nearly 90% of Japan’s centenarians are women.

economy. Even though progress has been predictably slow, the markets are giving Aquino an A for effort. The stock market index has risen 19.44% in the past year. More importantly, the Philippines has become one of the fastest-growing economies in Asia. The gross domestic product rose 7.4% last year and is on track to better that result this year. • Jonathan Manthorpe (jonathan. manthorpe@gmail.com) has been an international affairs columnist for nearly 40 years.

China’s president stalls economic reform There have always been doubts about how serious China’s new president, Xi Jinping, is about the new round of economic reforms and liberalization, whose chief cheerleader was the now overshadowed and increasingly inconsequential Premier Li Keqiang. Those doubts became even more well founded last week with the news of the resignation of Dai Haibo, the chief of the Shanghai Free Trade Zone. Establishment of

the Shanghai FTZ was announced a year ago as a testing ground for liberalization of rules governing financial service industries, capital account transactions and interest rates. Reports from Hong Kong, however, say that Dai is under investigation for corruption and note that Wang Qishan visited Shanghai a few days before the announcement of his resignation. Wang is the chief of the Communist Party’s Central Commission for Discipline Inspection, and Xi’s Rottweiler in the continuing anti-corruption campaign,

Now Open

which is aimed primarily at the president’s political rivals. As Xi has taken more control of China’s economic policy, which should in theory be in the hands of Premier Li, the president is showing the most enthusiasm for cracking down on the supposed misbehaviour of foreign companies and for investing in state-owned infrastructure companies. Several eminent analysts have concluded this tack is seriously undermining the dynamism of the Chinese economy. Since the Shanghai FTZ was launched in September last year

– without its main promoter Premier Li at the ceremony – about 10,000 businesses have registered to be included. But they report almost no concrete progress because the authorities have yet to produce the framework for liberalization and deregulation. This is not China’s first financial services liberalization zone. One was established at Qianhai four years ago and another at Wenzhou two years ago. But, as with the Shanghai FTZ, there has been no progress in getting them up and running.

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BUSINESSVANCOUVER September 23–29, 2014

finance

New Pacific Metals (TSX:NUX) weekly price gain

D 22%

D 17%

UrtheCast Corp. (TSX:UR) weekly price gain

datapoints economic outlook for Northeast British Columbia B.C. coal price outlook

Global oversupply and lower-than-expected demand have caused coal prices to plunge over the past two years

Natural gas indicators

Gas production is at record highs and prices have been improving, but new development remains subdued 12

$300

200

10 10

8 6

Dollars

Cubic metres (billions)

250

4 150

8 2

100

7 2002

2010 2011 2012 2013 2014 2015 2016 2017 2018 Dollars

2004

2006

2008

2010

Production (L)

Forecast

2012

2014

Henry Hub Price, USD (R) Sources: bc stats, eia, central 1 credit union

Sources: Consensus forecasts 6/14, central 1 credit union

Northeast B.C. resale housing market

Northeast B.C. timber harvest

Forestry activity has been improving in the region, with bigger timber harvests and increased production

Resale transactions are trending modestly higher but hold below mid-2000 highs $350,000

2,000

300,000

5 1,500

250,000

4 Units

he sparkle of B.C.’s northeast economy will dim this year despite higher natural gas production and forestry activity, as upheaval in the global coal sector, a modest agriculture performance and more tempered commodity exploration promise to cut into regional growth. We expect modest growth for the economy over the next few years, but a decelerated pace of expansion this year and next. Coal is the key headwind in the region as low prices and few signs of an impending global pickup in demand – particularly from China – have driven producers to shutter mines and curtail development over the past year. A more recent announcement by Anglo American to idle its Tumbler Ridge mine means there will likely be no coal mines in operation by some time in early 2015, down from four at the beginning of 2014. Times have indeed changed. Despite this shock, there has been good news. Forestry activity is improving, with bigger timber harvests and increased production following

USD/metric tonne

Bryan Yu

$14

Dry cubic metres (millions)

Data Points

reinvestments in local area mills. Meanwhile, the natural gas sector, which is exclusively in the northeast, has improved with stronger production and prices this year. The sector is forecast to show further improvement over the forecast period. Oil and gas GDP growth is forecast to reach 3%, with growth of above 4% in 2015 through 2017. Growth reflects higher gas prices, with one important caveat. Longproposed liquefied natural gas projects in the provincial northwest need to be realized to drive a long-term upshift in sector expansion and exploration in the northeast. While the prognosis remains positive for the still-nascent sector, it is far from certain. Employment is expected to decline by 4% this year but grow by about 2% through 2017. Despite the subdued profile, the labour market remains tight with relatively low unemployment and high labour force participation. Population growth slows to about 1% this year and next in response. Housing generally remains firm due to population and income gains in prior years. Resale transactions trend modestly higher but hold below mid-2000 highs, while home prices gain 7% this year and average 3% per year through 2017. Demand has increasingly filtered into the new home market. •

200,000 1,000 150,000

Dollars

Regional growth slows this year but future remains bright

100,000

500

50,000

Bryan Yu is an economist at Central 1 Credit Union.

6 8 4 2 6 4 2 0 00 00 00 00 00 201 201 201 201 2 2 2 2

Transactions

Sources: Landcor, central 1 credit union

Sources: B.C. Ministry of forests, central 1 credit union

money & finance

Median price

October 2, 2014 Register at www.biv.com/events/biv/money-finance

Moderator:

Robert Napoli Vice President, First West Capital

WHERE: The Pan Pacific Hotel Crystal Pavilion 999 Canada Pl. #300 Vancouver, BC

Panelists:

Bruce Constantine President, Espro Inc

AGENDA: 7:00 am - 7:45 am: Registration & Breakfast 7:45 am - 9:00 am: Panel Discussion 9:15 am - 10:15 am: Roundtable Sessions (optional)

Axel Christiansen Managing Director, BC/Yukon, BDC Capital

PRICE: Subscribers: $49 Non-subscribers: $59

Katri Ulmonen International Tax Services, MNP LLP

Presented by: Sponsored by:

Patrick Payne CEO, QuickMobile

finance

D 12%

Cardiome Pharma (TSX:COM) weekly price gain

First Point Minerals (TSX:FPX) weekly price drop

F 21%

Formation Metals (TSX:FCO) weekly price drop

A comprehensive snapshot of B.C.’s economy that includes forecasts and key indicators to provide business decision-makers with more tools to help them understand the economy’s strengths, weaknesses and direction. Compiled by Jen St. Denis

REAL ESTATE Building permits

Millions

Residential permits jumped by 44% in July. Total permits issued rose by 32%, a multi-year high $900 800 700 600 500 400 300 200 100

$840

Housing starts

Multi-unit starts and housing starts in Metro Vancouver led growth in August 25,000

22,464

20,000 15,000

$354

10,000 5,000

4,150

J S N J MM J S N J M M J S N J MM J

MM J S N J MM J S N J MM J S N J MM J

2011

Residential

September 23–29, 2014

QLT Inc. (TSX:QLT) weekly price drop

F 21%

INSIDERTRADING

dashBoard

2012

F 21%

BUSINESSVANCOUVER

2013

2014

Industrial-commercial-institutional

Condo prices in both Greater Vancouver and the Fraser Valley have been flat compared to detached house prices

2013

Single detached starts

Sources: bc stats, central 1 credit union

Greater Vancouver prices

2012

2014 Multiple-unit starts

Sources: canadian mortgage and housing corporation, central 1 credit union

Fraser Valley prices

Fraser Valley condo prices have declined at certain points over the past few months $600,000

$800,000 600,000

400,000

400,000 200,000

200,000

J F M AM J J A S O N D J F M AM J J A

J F M AM J J A S O N D J F MA M J J A

2013

2014 Detached home

Condo

Source: Real Estate Board of Greater Vancouver

Detached home

2014

Condo

Source: Real Estate Board of Fraser valley

Benchmark residential real estate prices August 2014 $798,600 $569,800

August 2013 $758,100 $551,000

YOY % CHG 5.30% 3.40%

Semi-detached home in Metro Vancouver Semi-detached home in the Fraser Valley

$399,200 $298,500

$390,400 $298,200

2.30% 0.10%

0.30% 0.00%

Condominium in Metro Vancouver Condominium in the Fraser Valley

$344,200 $196,700

$336,000 $203,900

2.40% -3.50%

0.70% 1.00%

Detached home in Metro Vancouver Detached home in the Fraser Valley

1-month % CHG 0.30% 0.30%

Sources: real estate boards of greater vancouver and fraser velley

The following is a list of stock trades made by corporate executives, directors and other company insiders of B.C.’s public companies filed the week ending September 17. The information comes from a compilation of required reports filed with the BC Securities Commission obtained from DisclosureNet.com.

Insider Glenn Pountney, 10% owner Company: VMS Ventures Inc. (TSX:VMS) Shares owned: 20,803,000 Trade date: September 9, 10, 11, 15, 16, 17 Trade total: $509,890 Trade: Acquisition of 1,807,000 shares at prices ranging between $0.28 and $0.30 per share Insider Sheldon Inwentash, officer Company: Integra Gold Corp. (TSX:ICG) Shares owned: 0 Trade date: September 12 Trade total: $225,000 Trade: Sale of 500,000 shares at a price of $0.45 per share Insider Michael Curt Scholz, 10% owner Company: CMC Metals Ltd. (TSX:CMB) Shares owned: 135,000 Trade date: September 10 Trade total: $198,550 Trade: Sale of 3,610,000 shares at $0.055 per share Insider Bradford Cooke, director Company: Endeavour Silver Corp. (TSX:EDR) Shares owned: 1,092,831 Trade date: September 10 Trade total: $108,000 Trade: Acquisition of 20,000 shares at a price of $5.40 per share Insider George R. Ireland, director Company: Taseko Mines Ltd. (TSX:TKO) Shares owned: 50,000 Trade date: September 11 Trade total: $99,500 Trade: Acquisition of 50,000 shares at a price of $1.99 per share Insider Walter Soo, officer Company: Great Canadian Gaming Corp. (TSX:GC) Shares owned: 103,900

Trade date: September 11 Trade total: $94,316 Trade: Sale of 4,800 shares at prices ranging between $19.64 and $19.65 per share Insider Gordon Keep, director Company: San Antonio Ventures Inc. (TSX:SAN) Shares owned: 384,382 Trade date: September 11, 12 Trade total: $77,260 Trade: Sale of 310,000 shares at prices ranging between $0.24 and $0.28 per share Insider Harry Chew, director Company: Bi-Optic Ventures Inc. (TSX:BOV) Shares owned: 1,086,200 Trade date: September 16 Trade total: $50,000 Trade: Sale of 2,500,000 shares at a price of $0.02 per share Insider Allen L. Ball, director Company: I-Minerals Inc. (TSX:IMA) Shares owned: 20,974,832 Trade date: September 12 Trade total: $48,500 Trade: Acquisition of 242,500 shares at a price of $0.20 per share Insider Garrett Paul Ainsworth, officer Company: Nexgen Energy Ltd. (TSX:NXE) Shares owned: 450,000 Trade date: September 17 Trade total: $41,000 Trade: Acquisition of 100,000 shares at a price of $0.41 per share Insider Peter Anthony Brieger, director Company: Scorpio Gold Corp. (TSX:SGN) Shares owned: 543,885 Trade date: September 11 Trade total: $38,675 Trade: Sale of 227,500 shares at a price of $0.17 per share Insider Charles Edgar Fipke, director Company: Cantex Mine Development Corp. (TSX:CD) Shares owned: 5,481,881 Trade date: September 16 Trade total: $37,500 Trade: Acquisition of 750,000 shares at a price of $0.05 per share •

Registration now open! Join us to celebrate exceptional leadership when Deloitte, Business in Vancouver and MacKay CEO GO2PRODUCTIONS Forums present the 2014 BC CEO Awards. CEOs in British Columbia. Winning CEOs will be profiled make18th, it great in Business in Vancouver on October 28th and honoured at a gala dinner on November 2014. Each winner will share their leadership lessons to an audience of Vancouver’s business community. WHEN: November 18, 2014 | 6:15 pm - 9:00 pm WHERE: Fairmont Waterfront Hotel, 900 Canada Place, Vancouver PRICE: Subscribers: $175 | Non-subscribers: $195 | Regular Table: Subscribers: $1750 | Non-subscribers: $1950 | Corporate Table: $2500 (includes logo recognition)

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BUSINESSVANCOUVER September 23–29, 2014

HOw

Early move to cloud was smart move for e-commerce platform developer

I did it Harry Chemko | Software Business in Vancouver’s “How I Did It” feature asks business leaders to explain in their own words how they achieved a business goal in the face of significant entrepreneurial challenges. In this week’s issue, Harry Chemko, 35, talks about seizing on trends such as e-commerce and cloud-based software as a service (SaaS) to develop Elastic Path Software into a major player in the e-commerce space.

“

was 19 when I started the company. My last job was at McDonald’s. I was at Royal Roads University getting my bachelor of commerce degree. “We started the company when the [Internet] bubble burst, so there wasn’t a lot of financing available for the ideas we had. So we ended up going into application development and built out custom applications for local companies. “It was about two yea rs i n

company founder succeeds by keeping his company flexible

where we had customers come to us and say, ‘We need to start selling our goods online – can you do that for us?’ We realized that there was just a huge white space in between these enterprise, IBM-Oracle platforms that were expensive and complex, and really, really entrylevel products. So we decided: ‘T here’s a market here, let’s build this.’ “We stopped doing the services work and application development work and went 100% an e-commerce company. Our first big account was Air Canada’s Aeroplan. They’re still a great client of ours. If you go online and buy anything outside of flights, you’re using the Elastic Path platform. “In 2007, we signed a deal with BEA Systems. It was a $1 billion m idd lewa re compa ny. T hey wanted to resell our software into their enterprise accounts.

They white-labelled it and we got a lot of great accounts there, and that’s what really got us into the enterprise space that we are now. “Technology environments today are inherently complex multi-vendor setups. We knew our solution needed to interact with – and add significant value to – those other systems. So we built a platform using an APIcentric approach. “API stands for application programming interface. APIs are what glue the different technology systems together. For example, Facebook provides developers with an API to integrate Facebook features into a site or app, such as [the option to] sign in with Facebook or adding ‘like’ buttons to product pages. “From the e-commerce side, we were the first to build an API to allow our own developers and third parties to take pieces of functionality and integrate

them with other apps, such as placing a ‘buy’ button into a social network. “We’ve had steady growth. The inflection point was probably around the 2008 time frame. Ecommerce systems have always been lagging in their moving to the cloud. We realized four years ago that there was this real shift going on in the market and we decided to make a change, where we started selling our platform on a subscription basis. “There was that, and then the move to becoming a partnercentric company, where some of the biggest interactive agencies and system integrators are doing the implementation for our e-commerce platform. We used to do a lot of the work for our customers ourselves. Now we work with a big network of partners – we’ve signed 15 partners in the last year – that implement the platform on our behalf.” •

Q&A Q : What are your biggest markets? A : We are fairly split between North America and Europe. Europe’s about 40% of our business. Q : You just recently raised another $5.35 million in venture capital, in addition to $4 million last year. What will you use the money for? A : This is helping us expand our partner channel both in the Americas and Europe. Q : Who is your biggest customer? A : Revenue-wise it’s [anti-virus software maker] Symantec.

Company switches from doing custom software development to building an e-commerce platform

Elastic Path moves to cloud, starts selling e-commerce platform on a SaaS basis

Elastic Path raises $4 million in venture capital

2014

July 2013

Name changed to Elastic Path

2008

2005

Chemko starts Ekkon Technologies out of university doing customer software development for local companies

2003

2000

K catching the online sales wave

Elastic Path raises another $5.35 million in venture capital led by BDC Capital

Next week’s How I Did It – Sheila Bouman, executive vice-president, Peer 1 Hosting

How did you do it? Do you or does someone you know have a story to share? Contact Nelson Bennett at nbennett@biv.com

Join us for a fantastic opportunity to meet and mingle with some of BC’s fastest growing companies when Business in Vancouver presents the 2014 Top 100 Fastest Growing Companies event. A networking reception is followed by a panel discussion to hear from some of the leaders behind these companies and learn how they did it. The Top 100 Fastest Growing Companies list, published in the September 16th issue of BIV, features companies across BC who have shown remarkable growth over the past five years.

BUSINESSVANCOUVER September 23–29, 2014

profile | Kirk Lapointe

City business Mayoral candidate Kirk LaPointe sees parallels between the news industry, to which he has devoted most of his career, and his newfound calling of politics: at their best, both can change society for the better, he says

Non-Partisan Association mayoral candidate Kirk LaPointe says Mayor Gregor Robertson has become “distracted” by issues that fall outside of city hall’s jurisdiction | Richard Lam

Mission

To be elected mayor of Vancouver

Assets

Long experience at the centre of issues affecting the city, including several years as managing editor of the Vancouver Sun

Yield

Solid grounding in the political life of Vancouver and a fresh perspective on solutions to the city’s challenges

BY Jen St.Denis jstdenis@biv.com

irk LaPointe is getting ready to do battle. The 56-year-old recently added more strength training and boxing to his regular workout schedule, an effort, he says, to stay fit for the gruelling work of campaigning for mayor of Vancouver. But it remains to be seen whether the NonPartisan Association (NPA) candidate will succeed in landing a knockout punch to unseat Vision Vancouver’s Gregor Robertson. Vision Vancouver has dominated Vancouver city council since Robertson was first elected in 2008 and re-elected in 2011. Robertson is the first Vancouver mayor to serve more than one term since Philip Owen’s three-term run in the 1990s. Robertson was elected on a platform that

included a pledge to end homelessness and make Vancouver the world’s greenest city. But recent polls show Vision has become vulnerable on issues like transparency and homelessness, and the city has been hit with numerous lawsuits from disgruntled community groups unhappy with the way council has made decisions on park lands and development. In contrast to recent NPA mayoral candidates Suzanne Anton, Peter Ladner and Sam Sullivan, who had all served as Vancouver city councillors, LaPointe is a political newbie who is largely unknown to Vancouver voters. LaPointe has yet to finalize his platform. But he insists that as leader of the NPA, the party and the campaign are his to shape. “I’m pushing for a more progressive agenda that matches with a more fiscally prudent approach,” LaPointe said. “We’ll borrow ideas from the left, right and centre.”

LaPointe may have his work cut out for him if he plans to appeal to voters outside the NPA’s traditional base: polls show support for Vision is strongest among young people, renters, cyclists and downtown dwellers, while the NPA has highest support among voters over age 45, property owners and non-cyclists. “Ideology is 20th-century politicking, particularly in a municipal concept,” he said. LaPointe may not be well known to the public, but he is familiar to Vancouver’s journalists. He was managing editor at the Vancouver Sun from 2003 to 2010 and CBC ombudsman from 2012 to 2013; he is currently publisher and editor-in-chief at North Vancouverbased Self-Counsel Press. He also teaches at the University of British Columbia Graduate School of Journalism. continued on page 20

profile

BUSINESSVANCOUVER September 23–29, 2014

City Business Continued from page 19

LaPointe started his career as a reporter at the Ottawa bureau of the Canadian Press; later he went on to hold an array of editing and executive positions at the Canadian Press, the Hamilton Spectator, National Post and CTV. At the Spectator, he turned around a struggling paper and increased circulation; he set up the National Post’s newsroom. Sometimes he held down two jobs at once, as when he worked as Ottawa bureau chief for the Canadian Press and hosted a weekly political affairs show on CBC Newsworld. LaPointe’s rise to the top stands in stark contrast to a childhood marked by poverty. B or n i n Toronto to a s i ngle mother who had to decide whether to keep him or his older brother (his brother, who was 12 when LaPointe was born, was sent to live with friends in New Brunswick), LaPointe remembers often going to school hungry. “She’d get paid on a Thursday night … so we’d have food T hursday, Friday, Saturday, Sunday,” LaPointe said. “But by Monday the cupboard would be getting bare and by Tuesday and Wednesday I was living on things like peanut butter or butter-andsugar sandwiches, which were quite common back then.” W hen LaPointe was 12, his mother got ma rried a nd the

family moved to suburban Etobicoke. Life became more stable; LaPointe also gives credit to the helpful neighbours and teachers who realized he was a child in need. “I was found in a lot of ways,” he said. He put out a newspaper as a school project in Grade 6; by high school, LaPointe was writing a column for a community paper in Etobicoke and hosting a television show about music and bands on a local cable station (he also edited Billboard magazine for nearly a decade). He went on to study journalism at Ryerson University. “My writing and my capacity to entertain and inform became a way not only to indulge my curiosity,” LaPointe said, “but a way to find my way out of poverty and meet people who were interesting and find a job doing it.” Those childhood experiences h ave i n spi red a n a mbit iou s policy idea LaPointe said he will make a key part of his platform. “One of the things I want to do for the city is make sure we have a full-fledged program in which children don’t go to school hungry; they’re not in the classroom with hunger pangs,” he said. “We have a patchwork of programs right now that still leave thousands of children in a rich city like this without the capacity to have meals, and then we send them home on the weekend on the assumption they’ll be able to

Party platform planks NPA mayoral candidate Kirk LaPointe has yet to reveal his full platform, but here is where he stands on some of the key issues.

Housing affordability “The affordability issue is not simply one of the cost of a house. It’s in a lot of cases the type of housing stock that’s created. I’m quite intrigued by a lot of the work lately under the Urban Development Institute, some of the new prospects that they’re proposing that would be innovations in housing design or in some cases bylaw changes that would permit different types of housing and different types of zoning.”

making city decisions and budgets clearer to the public, including a more detailed line-item annual budget.

Taxes LaPointe told Business in Vancouver he would freeze tax rates until the city’s books were opened to the public.

Coal and pipelines LaPointe believes Mayor Gregor Robertson has gotten “distracted” on issues that are outside municipal jurisdiction, such as the Kinder Morgan pipeline expansion and railway coal shipments. “The mayor needs to focus on the things the mayor can do things about,” LaPointe said.

needs a conversation that is going to involve the federal government ... the province ... and the private sector.” On the Downtown Eastside: “I see a fairly substantial layer between those that are dispersing the money and those that ought to be receiving it. I think we need a new conversation, we need an audit and we need a new champion down there who will take charge of it.”

Transportation

Transparency

Homelessness

LaPointe has said he would create a new position at city hall to focus on

“The homelessness issue needs an entirely new conversation, and it

LaPointe has criticized Robertson for pushing for a Broadway subway line without support from the provincial or federal government. While he has said he will take a second look at the decision to put a bike lane on Point Grey Road, he says he “believes in the bicycle as a form of transportation and recreation” and wants equal emphasis placed on efficient movement for cars and bikes.

find food. That’s an assumption that isn’t valid.” LaPointe, who has helped raise a stepdaughter and has two adult children from a previous marriage, would also like to create a comprehensive mentorship program for school-aged children. “I’d like to set up what would be, I hope, one of the world’s great networks of linking children with their passion,” he said. As he was at several points i n h i s ca reer, L a Poi nte wa s recr u ited for t he m ayora l

candidacy. Before being asked to run, LaPointe said he hadn’t planned to become a politician, but he sees parallels between politics and journalism: at their worst, both can have a defensive, just-trust-me culture. At their best, they can effect positive change in society. “I look at it as a transition between a period of my life where I was looking for solutions, and now I can furnish some of those solutions and answer the questions,” he said. •

My writing ... became a way not only to indulge my curiosity, but a way to find my way out of poverty and meet people who were interesting and find a job doing it

[] Kirk Lapointe npa mayoral candidate

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BUSINESSVANCOUVER September 23–29, 2014

Mining

New Prosperity needs government leadership

Vancouver miner’s steam coal plan hits roadblock

Mining juniors digging their way out of fiscal hole

Mining association boss says rejected Taseko project is too valuable to abandon

Low thermal coal prices stall Alberta mine project, Ridley Terminals expansion

Smaller mining and exploration companies finding creative ways to attract financing for new projects

BIVLIst

Biggest mines in B.C.

“Years, not months”: Wood Mackenzie analyst Joe Aldina’s prediction for the recovery of metallurgical coal prices | Coal Association of Canada

‘Unsustainable’ coal prices pulling plug on more mine production in B.C. Sponsored by

resources | National coal conference kicks off on the same day that industry announces the closure of another metallurgical coal mine By Nelson Bennett nbennett@biv.com

t wasn’t the kind of news the Coal Association of Canada wanted to hear on the day it kicked off its annual coal conference in Vancouver. On September 10 – Day 1 of the twoday conference – Anglo American PLC

announced it would close yet another B.C. coal mine at the end of this year, throwing another 360 miners and 30 contractors in Tumbler Ridge out of work. That brings to four the number of metallurgical coal mines in B.C. that will have been either placed under care and maintenance or kept there in 2014. Walter Energy Inc. (TSX:WLT) idled

mines in Tumbler Ridge in April and Chetwynd last month, and Teck Resources Ltd. (TSX:TCK) announced that the planned restart of its Quintette mine in Tumbler Ridge will be postponed. Metallurgical coal producers around the world have announced 20 million tonnes of continued on page 22

BUSINESSVANCOUVER September 23–29, 2014

‘Unsustainable’ Continued from page 21

cuts to global production; however, fewer than three million were implemented in 2014’s first half, so there is still plenty of inventory to work through. And unless prices start rising soon, more curtailments could be on the horizon. “A rou nd on e-t h i rd of t h e industry is uneconomical, so clearly prices are at unsustainable levels,” Real Foley, vicepresident of marketing for Teck Resources Ltd. – the secondlargest metallurgical or “met” coal exporter in the world – told coal industry leaders during a coal conference panel discussion

Mining September 11. Met coal peaked at about $300 per tonne in 2011 and is now at $120 per tonne. The good news – if there is any – is that, of all the coal-producing nations, Canada – the world’s third-largest met coal producer – is still in a strong position for what is viewed to be an inevitable turnaround. “Canada’s in a pretty good spot, when you look around the world, overall,” Joe Aldina, an analyst for Wood Mackenzie, told Business in Vancouver. Long term, the demand for met coal is expected to grow. China alone is expected to see its demand for met coal increase by 90 million tonnes by 2018, Foley said, adding that that’s

about equa l to Japa n’s tota l consumption. “Demand is not the issue,” Foley sa id. “T he problem is oversupply.” There is a global glut of seaborne steelmaking coal, due in part to Australia flooding the market with more coal than it needs after its mines, which were shut dow n b ec au se of f looding in 2011, returned to production. Austra l ia’s low dollar has helped its seaborne met coal producers while their counterparts – mainly in the U.S. – have been forced to cut production. The low prices are forcing curtailments at existing mines and delaying the construction of new ones.

Around one-third of the industry is uneconomical, so clearly prices are at unsustainable levels

[] real foley vice-president of marketing, teck resources

“We have a view that these prices are unsustainably low, and that a turnaround is coming,” Aldina said. “We think that it’s going to be U-shaped rather than a Vshaped recovery – an incremental recovery.” But he added that the recovery will likely take “years, not months.” Metallurgical coal is B.C.’s single largest export commodity and employs 26,000 people. Recent mine closures have resulted in at least 1,000 miners being laid off, however. B.C.’s most productive mines are owned by Teck Resources, which has five operating mines in B.C. and one in Alberta. It also owns the Quintette mine in Tumbler Ridge, which shut down in 2000. •

Teck’s sales profile

25% 50% 15% 5% 5%

China Other Asian countries Europe North America Latin America

B.C. Coal Mining by the numbers

10 26,000 89%

Operational mines

$3.2b

Coal’s annual contribution to B.C.’s GDP

$715.2m

Taxes paid in 2011 by B.C. coal mining industry

Direct jobs Percentage of Canadian metallurgical coal that comes from B.C.

briefs Turquoise Hill tax cut opens way for Mongolian mine expansion Shares in Vancouver’s Turquoise Hill Resources (TSX:TRQ) showed little reaction on September 16 following confirmation from Mongolian authorities that the amount of tax claimed in a dispute over the Rio Tinto subsidiary’s Oyu Tolgoi mine will be cut substantially. The Sydney Morning Herald reported that Mongolia’s vice-minister of mining, Oyun Erdenebulgan, confirmed that the National Tax Dispute Settlement Council will reduce the tax claim on the $5.6 billion mine to approximately $30 million from around $130 million. Resolution of the dispute paves the way for a resumption of work on Oyu Tolgoi’s underground expansion. Turquoise Hill halted construction in November and in June suspended work on a feasibility study for the underground phase over the tax issue. The copper-gold-silver mine is 66% owned by Turquoise Hill; the Mongolian government holds the rest. Shareholders who have marked down the share price nearly 20% over the past year jumped back following unconfirmed reports about the tax break. – Mining.com

K biv.com

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mining

BUSINESSVANCOUVER September 23–29, 2014

Political leadership needed on New Prosperity: CEO Q&A | Rejected

Taseko project “too valuable to just walk away from,” says mining association boss is that? A: What I’m trying to argue for is more focused attention on the opportunity that we have and to not just take it for granted that, because we’ve had a strong industry historically, we’re necessarily going to have one well into the future. We are a vast country with a lot of potential. A lot of our interesting deposits are in the northern parts of this country. You’ve got world-class zinc deposits in Nunavut. There isn’t a

By Nelson Bennett nbennett@biv.com

ierre Gratton, who spent three years as the head of the Mining Association of British Columbia before becoming CEO of the Mining Association of Canada, was back in Vancouver recently to speak to the Vancouver Board of Trade about the state of mining in Canada. Prior to his talk to the VBOT on September 11, Gratton spoke to Business in Vancouver about the state of mining and recent events affecting the industry.

Q&A Q : The Mount Polley tailings pond collapse is taking up a lot of oxygen in any discussion on mining right now and is the subject of an independent investigation. Just how damaging has this been to the industry? A: An incident like this, a major tailings breach, is unacceptable. In the 1990s, the Mining Association of Canada (MAC) and its members got together, following three different tailings failures in different parts of the world but by Canadian companies that were members of MAC. We led a two-year process to investigate the reasons and underlying factors behind those failures. The conclusion was that it was not a failure of engineering – it was a failure of management. We developed a series of best practice manuals … and through our own initiative, Towards Sustainable Mining, we have created a system that leads all members to fully implement those guides. It’s a condition of MAC membership that you be part of this process that leads to their full implementation. Imperial Metals (TSX:III) was a new member of MAC and was not very far along in our process, so we don’t actually know where they were, which is why the investigation is so important. If there’s anything that we need to do differently, we want to know what that is so we can take the steps to do it. Q : Globally, mining and exploration has seen investment capital dry up. Just how bad was 2013? A: I guess 2013 was weaker than 2012, and 2011 was the strongest. But relatively speaking, all three of those years are stronger than 2004. So it’s all relative. Q : So is it only because we have been comparing this latest downturn to an unprecedented decade-long supercycle in mining that 2013 seems so bad?

road to get there. You haven’t got ports to ship the product or to get equipment in. You’re relying on fly-in, fly-out operations. Similarly in the northern parts of provinces where you’re not connected to the grids, where there aren’t roads, where there isn’t rail, those projects are being priced out of the market. In other parts of the world – like in Australia, for example – you’re seeing countries being more proactive to take advantage of these opportunities. Collectively,

we need to be thinking about our longer-term infrastructure needs. Q : Here in B.C., BC Hydro is commissioning the new Northwest Transmission Line, primarily to power new mines. How significant are projects like that? A: It could be a very significant catalyst, over time. It changes the economics of a lot of those deposits up there if they have continued on page 27

B.C. and Canada should carefully consider long-term infrastructure needs to take advantage of potentially rich mining prospects in the North, says Mining Association of Canada CEO Pierre Gratton

What I’m trying to argue for is more focused attention on the opportunity that we have and to not just take it for granted that, because we’ve had a strong industry historically, we’re necessarily going to have one well into the future

A: Exactly. Because the demand is fundamentally still there [for commodities] and is expected to continue. It’s going to pick up again and we’re already starting to see some movement in some commodities. Zinc is doing extremely well at the moment, and lead is recovering. Nickel is doing well. Copper has never really fallen to where many predicted it would. Met [metallurgical] coal is going through a tough period, but prices for met coal held out longer than many expected. You’ve still got commodity prices much higher than they were a decade ago. So even the slump that we’ve been through does not compare to the slumps that I recall from the late ’90s, early 2000s. What we’ve seen in the current slump is not necessarily companies struggling due to low commodity prices, but companies struggling because an overheated economy drove up costs to such a point where even the stronger prices weren’t sufficient.

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Cassels Brock - September 16, 2014 Business in Vancouver: Mining Report

Submitted by: Darlene Lowe dlowe@casselsbrock.com

Please PRINT a hard copy of the file and

BUSINESSVANCOUVER September 23–29, 2014

MINING

Biggest mines in in B.C. B.C. BiggestMine mines revenue in 2013 RANKED BY | Ranked BY | Mine Rank '14

revenue in 2013

Mine Nearest town

Mine operator

Type of operation

Commodities produced Amounts produced '12

Amounts produced '13

Mine revenue '13/'12

Fording River1 Elkford

Open-pit mine

Metallurgical coal

9 million tonnes of coal

$1,459,158,0002 $1,459,158,0002

Elkview1 Sparwood

Open-pit mine

Metallurgical coal

13.3 million tonnes of coal

$1,100,000,0002 $1,054,869,0002

Highland Valley Copper Logan Lake

Open-pit mine

Copper, molybdenum

116,300 tonnes of copper, 10 million pounds of molybdenum

113,200 tonnes of copper, 6.1 million pounds of molybdenum

$1,000,000,0002 $1,012,000,000

Greenhills3 Elkford

Open-pit mine

Metallurgical coal

10 million tonnes of coal

$845,754,0002 $845,754,0002

Line Creek1 Sparwood

Open-pit mine

Steelmaking coal

7 million tonnes of coal

$570,000,0002 $566,934,0002

Coal Mountain1 Sparwood

Open-pit mine

Metallurgical and thermal coal

$435,000,0002 $436,818,0002

Gibraltar Williams Lake

Open-pit mine

Copper, molybdenum

89.7 million pounds of copper, 1.3 million pounds of molybdenum

121.4 million pounds of copper, 1.5 million pounds of molybdenum

$387,000,0002 $338,900,000

New Afton Kamloops

Underground mine

Gold, silver and copper

36,807 ounces of gold, 28.5 million pounds of copper

Trend Tumbler Ridge

Teck Resources Ltd 550 Burrard St Suite 3300, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com Teck Resources Ltd 550 Burrard St Suite 3300, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com Teck Resources Ltd 550 Burrard St Suite 3300, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com Teck Resources Ltd 550 Burrard St Suite 3300, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com Teck Resources Ltd 550 Burrard St Suite 3300, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com Teck Resources Ltd 550 Burrard St Suite 3300, Vancouver V6C 0B3 P: 604-699-4000 F: 604-699-4750 www.teck.com Taseko Mines Ltd 1040 Georgia St W Suite 1500, Vancouver V6E 4H1 P: 778-373-4533 F: 778-373-4534 www.tasekomines.com New Gold Inc 555 Burrard St Suite 1800 PO Box 212, Vancouver V7X 1M9 P: 604-696-4100 F: 604-696-4110 www.newgold.com Peace River Coal LP 1055 Hastings St W Suite 1900, Vancouver V6E 2E9 P: 778-786 7400 F: 604-688 5210 www.peacerivercoal.com

Open-pit mine

Metallurgical coal

1,376,300 tonnes of metallurgical coal2

82,177 ounces of gold, 72 million $321,570,000 pounds of copper, 193 million ounces $127,300,000 of silver 1.5 million tonnes of hard coking coal $244,981,4002 $244,981,4002

Brule4 Chetwynd

Open-pit mine

PCI metallurgical coal

1.8 million tonnes of coal

$235,000,0002 $291,916,330

Copper Mountain Princeton

Open-pit mine

Mount Polley Williams Lake

Copper (and gold and silver secondary credits) Copper, gold, silver

56.6 million pounds of copper, 18,900 ounces of gold, 354,000 ounces of silver 33.8 million pounds of copper, 52,236 ounces of gold, 116,101 ounces of silver 580,000 ounces of silver, 13,600 ounces of gold, 32,000 tonnes of zinc, 3,800 tonnes of copper, 1,100 tonnes of lead 8.6 million pounds of molybdenum sold7

66.2 million pounds of copper, 21,600 ounces of gold, 320,400 ounces of silver 38.5 million pounds of copper, 45,823 ounces of gold, 123,999 ounces of silver 27,000 tonnes of zinc, 3,300 tonnes of copper, 900 tonnes of lead, 17,800 troy ounces of gold, 818,000 troy ounces of silver 9.8 million pounds of molybdenum

$233,122,274 $229,473,610

Walter Energy5 688 Hastings St W Suite 800, Vancouver V6B 1P1 P: 604-608-2692 F: 604-629-0075 www.walterenergy.com Copper Mountain Mining Corp 700 Pender St W Suite 1700, Vancouver V6C 1G8 P: 604-682-2992 F: 604-682-2993 www.cumtn.com Imperial Metals Corp 580 Hornby St Suite 200, Vancouver V6C 3B6 P: 604-669-8959 www.imperialmetals.com Nyrstar NV Tessinerplatz 7 8002, Zurich, Switzerland www.nyrstar.com

Myra Falls Campbell River

Open-pit and underground mine Underground mine

Zinc, copper, lead, silver and gold as byproducts

$180,883,000 $197,859,000 $135,500,0002 $135,413,9002

Endako6 Fraser Lake

Thompson Creek Metals Co Inc 401 Bay St Suite 2010, Toronto M5H 2Y4 P: 416-860-1438 F: 416-860-0813 www.thompsoncreekmetals.com

Open-pit mine

Molybdenum

Wolverine/Perry Creek9 Tumbler Ridge

Open-pit mine

Coking coal

1.8 million pounds of coal

1.6 million tonnes of coal

$97,757,4402 $367,700,160

Orca Quarry Port McNeill

Open-pit mine

3.4 million tonnes

$44,869,000 $32,196,000

Quinsam Campbell River

Sand and gravel construction aggregates Thermal coal

2.2 million tonnes

Walter Energy5 688 Hastings St W Suite 800, Vancouver V6B 1P1 P: 604-608-2692 F: 604-629-0075 www.walterenergy.com Polaris Minerals Corp 1055 Georgia St W Suite 2740 PO Box 11175, Vancouver V6E 3R5 P: 604-915-5000 F: 604-915-5001 www.polarmin.com Hillsborough Resources Ltd 1090 Georgia St W Suite 950, Vancouver V6E 3V7 P: 604-684-9288 F: 604-684-3178 www.hillsboroughresources.com Huckleberry Mines Ltd 999 Hastings Street W Suite 1030, Vancouver V6B 2W2 P: 604-685-8299 www.imperialmetals.com

500,000 tonnes of coal2

500,000 tonnes of coal

$29,000,0002 $29,000,0002

Copper, silver, gold

35.1 million pounds of copper, 2,578 ounces of gold, 191,787 ounces of silver 10

41.2 million pounds of copper, 2,983 ounces of gold, 238,028 ounces of silver

$8,333,000 $5,517,00010

Huckleberry Houston

Underground mine Open-pit mine

Sources: Interviews with mining operators and BIV research. NP Not provided 1 - Operated by Teck subsidiary Teck Coal Ltd 2 - BIV estimate 3 - Joint venture agreement among Teck, POSCO Canada Ltd (POSCAN) and POSCAN’s parent, POSCO 4 - Closed July 2014 5 - Formerly Western Coal Corp 6 - Joint venture with Thompson Creek (75% interest) and Sojitz Corp, a Japanese company (25% interest) 7 - Includes Sojitz Corp's 25% stake in the mine 8 - 2012 figure 9 - Closed April 2014 10 - Production and revenue represents the 50% equity income attributable to Imperial Metals

Next week’s list – Biggest Crown corporations in B.C.

$112,230,0008 $112,230,0007

Business in Vancouver makes every attempt to publish accurate information in the List, but accuracy cannot be guaranteed. Researched by Anna Liczmanska, lists@biv.com.

Mining

BUSINESSVANCOUVER September 23–29, 2014

Global price drop puts thermal coal project on hold resources | Low

prices take toll on new mine project, but analysts see future demand on the rise

By Nelson Bennett

B.C.’s thermal coal shipping advantage

nbennett@biv.com

t last year’s Coal Association of Canada conference, Coalspur Mines Ltd. (TSX:CPT) CEO Gill Winckler told her peers that her Vancouver-headquartered company was ready to start construction on Vista, a new $500 million thermal coal mine in Hinton, Alberta. The junior coal miner had cleared most regulatory hurdles, had secured debt financing and had signed agreements with Canadian National Railway (TSX:CNR) and Ridley Terminals Inc. to ship up to 10.7 million tonnes of coal annually through Prince Rupert. At that time, thermal coal prices had hit what many thought was rock bottom – $77 per tonne, which was down 11% from 2012 prices and down 28% from 2011. “The general view here was that it was the bottom and prices were going to improve,” Winckler said in a sobering presentation to fellow coal industry leaders September 11 at the annual coal conference. The price for thermal coal (also known as steam coal, because it’s used to drive steam turbines to generate power) in North America has been cut nearly in half since 2011 – from $121 per tonne to about $66 per tonne today.

Coalspur CEO Gill Winckler: the company is considering various options to get its planned thermal coal project off the ground | Richard Lam

At those prices, Winckler said Coalspur found it “impossible” to raise the equity financing it needed. “Not only is the price down there, but as we know the expectations [for coal] have gone down fairly low for a few years. The impact of this on us was fairly profound, from a financing perspective.” Coalspur originally secured a com m it ment of $350 m i llion in debt financing, but the lender lowered it to $175 million,

meaning the company would need to raise $300 million in equity to build the mine, which is planned to be built in two phases. Winckler said the company is now looking at a variety of options – including finding a joint partner or selling the asset – while hoping for a rally. Meanwhile, it has been refining the project to get capital costs down and shrink its environmental footprint. The latter includes moving to a progressive reclamation process that eliminates the need for a settling

B.C. produces little steam coal (nine of B.C.’s 10 coal mines produce steelmaking coal) but has become a critical logistical link for the North American sector because it’s the only jurisdiction on the Pacific Coast with significant coal- handling capacity. Ports in Vancouver, Delta and Prince Rupert can handle 57 million tonnes of coal annually, and last month Port Metro Vancouver approved a new coal-handling terminal at Fraser Surrey Docks that will add four million tonnes of annual shipping capacity to B.C. ports. It will transport thermal coal from

pond – a major concern in the post-Mount Polley era. As domestic markets for steam coal shrink, producers in Canada and the Powder River Basin in the U.S. are looking to places like India, which is facing a power crisis because of Indian power companies’ inability to secure a reliable coal supply. And despite its war on pollution, China is expected to need steam coal to produce power for many years to come. “The projection out to 2025,

the Powder River Basin in Montana and Wyoming to Asian markets. When Ridley Terminals’ $255 million expansion is complete, the port’s annual capacity will be 25 million tonnes. But David Bromley, a Ridley director, confirmed that the full expansion to 25 million tonnes – originally slated for completion this year – is being delayed. Coalspur Mines had signed an agreement with Ridley for 2.5 million tonnes of capacity in 2015 that would be ramped up to 10.7 million tonnes. Bromley said the Vista mine’s deferral is one of the factors slowing Ridley’s expansion plans, which he said have been pushed back approximately two years.

by most analysts, including the International Energy Agency, is a global demand for thermal coal doubling in the next 15 years,” said Coal Association of Canada president Ann Marie Hann. But as with metallurgical coal, a recovery in steam coal prices is expected to take years, not months. Brokers are now projecting coal prices will not rise above $90 per tonne until 2018, so it could be several years before new coal mines like Vista become economically viable to build. •

MARKETS ARE DOWN. PROFITS ARE DOWN.

How do you stay competitive? With market caps, declining profits and numerous external factors chipping away at your bottom line, breaking even can seem like a daunting task for businesses in the mining industry. To effectively respond to fluctuating market conditions, your organization needs to look internally to find new efficiencies that will help you take control of your future. Backed by 20 years of experience, MNP’s National Mining Leader Ron Miller and his dedicated mining team, can improve your competitive edge – no matter what the markets may bring. MNP is one of the fastest growing accounting and business consulting firms in Canada with 16 offices across B.C. Ron Miller, CPA, CA, CBV, CPA (WA), National Mining Leader at 604.637.1524 or ron.miller@mnp.ca

mining

BUSINESSVANCOUVER September 23–29, 2014

Junior miners still digging themselves out of a hole investment | Exploration

companies get creative to attract project financing in tight markets Company Snapshot

IDM Mining Ltd. (TSX:IDM)

Vancouver

$0.40

2009

$0.59

$15,363,009

$0.03

Head office

Share price (as of September 17)

Year of formation

52-week high

Market cap (as of September 17)

52-week low

Recent IDM Mining interim financial statements (in Canadian dollars, for three months ending July 31)

2014

Irwin Olian doesn’t expect a turnaround in mining any time soon, so he’s making the jump to biotechnology By Nelson Bennett nbennett@biv.com

hen a mining and exploration supercycle ended early in 2012, junior miners were hit hardest by the flight of capital from the sector. Valuations of the top 100 junior mining and exploration companies listed on the TSX Venture Exchange fell from $20.6 billion in 2011 to $6.5 billion by mid-2013, according to a 2013 PwC report. “It’s tough to get exploration capital right now,” said Michael Gray, senior vice-president and team head for Canadian mining equity research at Macquarie Capital Markets Canada. “Very few companies can finance at a decent level.” Exploration spending in B.C. dropped from a high of $680 million in 2012 to $476 million in 2013, according to the Association for Mineral Exploration BC (AME BC), which predicts spending will be in the $400 million range in 2014. Battered and bruised though it is, the junior mining and exploration sector has weathered the downturn better than expected. “People expected this big wipeout, and that’s not the case,” said AME CEO Gavin Dirom. “They’re hanging in there. There’s a couple of interesting indicators, I think, that are pointing to a potential turnaround here.” With traditional debt and equity financing nearly non-existent for the past two years, some juniors have found new ways to finance exploration and new mine SINGLE POINT OF CONTACT

development. Last month, Vancouver’s True Gold Mining Inc. (TSX-V:TGM) inked a US$100 million streaming deal to build a new gold mine in West Africa. Meanwhile, a number of B.C. juniors have partnered with large companies to finance exploration and drilling in B.C. Companies focused on highgrade, low-capex projects, such as the IDM Mining Ltd. (IDM:TSX) Red Mountain project near Stewart in the “Golden Triangle,” have been having some success. IDM announced September 3 it will raise $2 million through a private placement, which follows on the $2.7 million it raised in June, to finance the acquisition of the Red Mountain gold property from Seabridge Gold Inc. (TSX:SEA). Riverside Resources Inc. (TSXV:RRI), meanwhile, has been financing drilling projects in B.C. with funding from Chile’s

B.C. juniors’ major projects are far afield Three of the most promising B.C. junior miners to watch, according to analyst Michael Gray, have one thing in common: none of their flagship projects are in B.C., or Canada for that matter. “There are very few high-quality exploration stories globally right now,” said Gray, senior vice-president and team head for Canadian mining equity research at Macquarie Capital Markets Canada. “Anything that was reasonably high quality was bought

BUSINESS SOLUTIONS

Antofagasta Minerals SA. Antofagasta is providing Riverside with $1.8 million over three years to finance drilling and other initial work on the Swift Katie project, a copper deposit near Salmo, B.C. Under Riverside’s “prospect generator” model, the company and its investors don’t have to come up with the upfront financing for exploratory work. “We have the major funding right from the beginning,” said Riverside CEO John-Mark Staude. The trade-off is that Riverside won’t end up owning an operating mine – Antofagasta will. Riverside would earn royalties. Kaizen Discovery Inc. (TSXV:KZD) raises capital for new projects by striking deals directly with Japanese trading houses to snap up other junior mining companies. It recently announced plans to acquire West Cirque Resources Ltd. (TSX-V: WCQ), which has several properties in B.C. • in the last 10 years, and that includes some B.C. projects.” That doesn’t mean B.C. still isn’t a good place for prospecting new mines. Analysts such as Gray say that once the investment chill comes off mining in general, the new Northwest Transmission Line will be a major catalyst for exploration in northwest B.C. Until then, it’s mostly prospective mines with low capital costs and highgrade deposits that are attracting investment, and those tend to be in places like Nevada, Africa and Mexico.

Total cash, equivalents

$1,269,129

Comprehensive income (loss)

($11,028,848)

Income (loss) per share

($0.53)

2013

D F F

$474,329 ($2,143,278) ($0.11) Sources: TMX, SEDaR

Company Snapshot

Riverside Resources Inc. (TSX-V:RRI)

Vancouver

$0.41

2006

$0.68

$15,174,829

$0.30

Head office

Share price (as of September 17)

Year of formation

52-week high

Market cap (as of September 17)

52-week low

Recent Riverside interim financial statements (in Canadian dollars, for three months ending June 30)

2014 Total assets

$11,634,488

Comprehensive income (loss)

($448,473)

Income (loss) per share

($0.01)

2013

F D D

$12,126,486 ($708,842) ($0.02) Sources: TMX, SEDAR

Asked which junior miners in B.C. are on the top of his watch list, Gray listed the following: •MAG Silver Corp. (TSX:MAG) Juanicipio silver mine in Mexico. “It has been a star performer, not only the share price, but its asset is widely viewed as one of the best undeveloped assets in the world.” •Midas Gold Corp. (TSX:MAX) Golden Meadows project in Idaho. Although Midas stock has underperformed, Gray believes its quality assets and its experienced senior management team are the sort

of things that will attract a major partner. “It’s the type of project that the seniors tend to look at – a project that could potentially be producing over 400,000 ounces [of gold] a year.” •Gold Standard Ventures Corp. (TSX-V:GSV). The company’s Railroad-Pinion property in the prolific Carlin Trend in Nevada makes it attractive. “On this trend that’s produced over 100 million ounces, these guys have a sizable land position and an ex-Newmont [Mining Corp.] team.”

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mining

BUSINESSVANCOUVER September 23–29, 2014

Low cost is key to attracting resource investment true gold | One

of the few Canadian junior miners to raise capital for new mine since 2012

Franco-Nevada will provide True Gold $100 million to help the company build its Karma gold mine in Burkina Faso, West Africa. That’s in addition to the $80 million True Gold has raised in equity financing since 2013. Sandstorm will provide 25% of the financing, Franco-Nevada 75%.

Under the agreement, Sandstorm and Franco-Nevada will receive 100,000 ounces of gold at a fixed price, to be provided at 20,000 ounces per year over five years, with an option to access an additional $20 million in financing. After the $100 million is paid back, the syndicate will continue

to get a 6.5% royalty on future gold production. Thanks to the deposit’s geology and high ore quality, True Gold can use a simple heapleach process to ex tract the gold. That dramatically reduces the mine’s capital costs, because no processing mill is required. The mine is also just 23

kilometres from Burkina Faso’s third-largest city, so it has access to a nearby workforce. The mine’s low cost is one of the things that sold Sandstorm CEO Nolan Watson on the project. The company’s management team was the other strong selling point. True Gold CEO Mark O’Dea is the former CEO of Fronteer Gold Inc., which sold to Newmont Mining Corp. (NYSE:NEM) for $2.3 billion in 2011. “It’s partly that low capital intensity, it’s partly the strong team in Mark O’Dea,” Watson said. T he K a rma project is T r ue Gold’s only property. The company expects to pour first gold by the end of 2015 and ramp up to full production of 150,000 ounces of gold per year in 2016. T he life of the mine is projected to be 8.5 years, but Alex Hol me s, T r u e G old’s v i c epresident of business development, sa id t he d iscover y of additional resources could extend the mine’s life far beyond that. “We believe in the exploration growth of the project,” Holmes said, “and the fact that Franco and Sandstorm have decided to partner with us is a pretty big endorsement of that growth.” •

reactions that I saw from some in the legal community, but more just commentators in general. The Fraser Institute stands out. Some of their early commentary I found very disturbing – implying that investment would flee. I have not seen it that way. There was nothing, in my view, earth-shattering about the Williams decision. It confirmed and provided greater clarity on what the courts had already laid out. We already knew there was an obligation by the Crown to consult and, if necessary, to accommodate.

Q : But this case involves the Tsilhqot’in, who have vigorously opposed the New Prosperity mine that Taseko Mines Ltd. (TSX:TKO) wants to build in their traditional territory. What does this mean for the New Prosperity mine? A : New Prosperity is a very important deposit. It’s a significant potential mine. It’s one of those that has to be built. It’s too valuable to just walk away from.

Agency has rejected it twice. How can Taseko overcome that? A : I think that we need governments to show some leadership. I just believe there’s a way to develop that project. If you go back 15 years to the situation with Voisey’s Bay [in Labrador], you had a worldclass nickel deposit and you had very, very tense relationships between the Crown and the two indigenous communities – the Inuit and the Innu – and the company. At one point the project was literally on hold.

It wasn’t until the governments stepped in and resolved disputed land claims that had been around for a long, long time, that the government created the conditions for the company to come in and build the project. Now it is today one of the models of First Nations participating in mining, with over 40% participation, significant benefits flowing to those two communities. If you think of where it came from and where it is now, I look at New Prosperity and I say, “Why can’t we do that there?” •

By Nelson Bennett

It’s partly that low capital intensity, it’s partly the strong team in Mark O’Dea

Company Snapshot

nbennett@biv.com

hen Vancouver junior miner True Gold Mining Inc. (TSX-V:TGM) inked a US$100 million investment deal last month with two Canadian streaming companies to finance a new $131 million open-pit gold mine in West Africa, it was a rare sprinkling in an otherwise prolonged investment drought. Junior mining and exploration companies have been particularly hard hit by the general downturn in mining. Since 2012, financings like the one True Gold landed last month have been rare. A c c o rd i n g to SN L M et a l s and Mining’s World Exploration Trends 2014 report, global spending on new mines and exploration was 29% lower in 2013 than in 2012. Streaming companies such as Vancouver’s Sandstorm Gold Ltd. (TSX:SSL) and Toronto’s Franco-Nevada Corp. (TSX:FNV) have come to the rescue of junior miners such as True Gold with streaming agreements – an alternative to debt or equity financing. Under an agreement reached last mont h, Sa ndstor m a nd

political leadership Continued from page 23

access to the grid. Energy costs can be 25% to 30% of operating costs. Q : Earlier this year, in the Williams decision, the Supreme Court of Canada affirmed the title of the Tsilhqot’in First Nation over land in their traditional territory. It’s been generally viewed as potentially negative for mining in B.C. Is it? A : I was troubled more by some of the interpretations and

True Gold Mining Inc. (TSX-V:TGM)

Vancouver

$0.395

Head office

[]

Share price (as of September 17)

1987

$0.485

$157,542,285

$0.27

Year of formation

Nolan watson ceo, sandstorm gold

52-week high

Market cap (as of September 17)

52-week low

True Gold financials (in Canadian dollars, for three months ending June 30) 2014

2013

Total assets

$82,591,723

$42,758,028

Comprehensive income (loss)

($6,680,098)

($9,410,256)

Income (loss) per share

($0.02)

($0.05) Sources: TMX, SEDAR

Chartered Accountants | Business Advisors

Q : But the Canadian Environmental Assessment

www.wm.ca

Extracting value together We are committed to helping businesses in the junior resource sector maximize their full potential

WE LOOK AFTER THE

BIG HAIRY ISSUES Expert Environmental Management & Advice. Environmental Assessment Regulatory & Permitting

Anna Moreton Killian Ruby amoreton@wm.ca kruby@wm.ca

Project monitoring ng tes Contaminated sites

Steve Yan-Klassen Dayna Rogowski drogowski@wm.ca syanklassen@wm.ca

900-400 Burrard Street, Vancouver, BC Tel: 604-684-6212

information@pggroup.com

BUSINESSVANCOUVER

send your free listing to fortherecord@biv.com

September 23–29, 2014

for the record People on the Move Email your For the Record information to: fortherecord@biv.com. Please include a high-resolution, colour headshot where possible. Development/ Construction

Shawna Nickel Nicole Tennison Shawna Nickel has been promoted to marketing director at ZGF Cotter Architects and Nicole Tennison has joined the firm as marketing co-ordinator. Nickel brings seven years of experience in the Vancouver development sector, with a specific focus on communications, proposal management and business development. Tennison is a graphic designer and storyteller with a focus on sustainable design across all platforms.

Finance

Bill Cunningham Bill Cunningham has joined the Richmond commercial banking centre of TD Bank as manager, commercial credit, after two years in TD’s commercial and agricultural credit risk management office in Calgary. Cunningham returns to the Lower Mainland market where he worked for over 15 years in both commercial banking and federal government. Health/Medical Julio Montaner Julio Montaner, director of the BC Centre for Excellence in HIV/AIDS, has been appointed global adviser for treatment at UNAIDS, the United Nations agency devoted to combating the disease worldwide. Montaner has been instrumental in setting the UN’s new “90-9090” global benchmarks by the year 2020. The benchmarks refer to increasing to 90% the proportion of people living with HIV who know their diagnosis, increasing to 90% the proportion of people living with HIV receiving antiretroviral treatment and increasing to 90% the proportion of people on HIV treatment who have an undetectable viral load. Montaner is also co-chairing the upcoming IAS 2015

Conference on HIV Pathogenesis, Treatment and Prevention in Vancouver in July 2015.

labour law.

Legal

Michael Weber Michael Weber has joined the corporate and commercial practice group of MEP Business Counsel. Weber advises public and private companies on a wide range of commercial matters, including financing, mergers and acquisitions, corporate governance and regulatory compliance; he has extensive experience in the energy/ infrastructure and renewable energy sectors. James D. Kondopulos James D. Kondopulos, partner at employment and labour law firm Roper Greyell LLP, was recently selected by his peers for inclusion in the 2015 edition of Best Lawyers in Canada, in the practice area of employment and

Elizabeth Duerr Spencer MacLean Laurence Scott Jeff Zilkowsky Elizabeth Duerr, Spencer MacLean, Laurence Scott and Jeff Zilkowsky have joined MacLean Law’s family law practice. Duerr has been practising family law in the Lower Mainland since 2009. MacLean has recently been called to the bar after completing his articles at the firm. Scott is a family law mediator, arbitrator and parenting co-ordinator; he is president of the New Westminster Bar Association and has a long track record of involvement in various legal associations and the community at large. Zilkowsky has experience in family law, personal injury, civil litigation, debtor/creditor and criminal law; he mentors law

students and speaks at postsecondary schools. Adrienne Murray Adrienne Murray has joined Hammerberg Lawyers’ strata property group. Murray is the former deputy superintendent of real estate for British Columbia and assisted with the drafting of the Strata Property Act. Murray continues to provide input on legislative amendments that affect strata corporations and strata management companies and advises strata corporations and owners on strata issues including bylaw drafting and enforcement, governance disputes and strata fee collections. Murray has prepared and presented courses to strata managers on behalf of the Real Estate Council of BC, PAMA and the Real Estate Institute of BC and is a regular presenter for the Condominium Home Owners Association. Non-Profit

Heidi Trautmann Brenda McGuire Heidi Trautmann and Brenda McGuire have joined SOS Children’s

siGnaTure evenTs OCTOBer 3 - 13, 2014

The 34th annual

Fall OkanaGan

Wine FesTival October 1, 7:00pm – 9:00pm BriTish COlumBia Wine aWards and reCepTiOn The laurel packinghouse, kelowna. price: $50 (all incl). October 3 & 4, 7:00pm – 9:30pm The WesTJeT Wine TasTinGs rotary Centre for the arts, kelowna. price $70 (all incl) or $120 (all incl) for both nights. October 8, 7:00pm – 9:00pm The Blind Wine & Cheese sOiree By valley FirsT The laurel packinghouse, kelowna. price: $50 (all incl). October 9, 6:30pm – 9:00pm alexis de pOrTneuF presenTs “The yOunG CheFs” “The atrium” Centre for learning Okanagan College, kelowna. price: $60 (all incl). October 9, 7:00 – 9:00pm OrGaniC Cheese and Wine - a naTural pairinG manteo resort, kelowna. price: $47 (all incl). TiCkeTs FOr all aBOve evenTs: www.selectyourtickets.com or 250.717.5304 October 10 & 11, 6:00pm – 9:00pm valley FirsT Grand Finale COnsumer TasTinGs penticton Trade and Convention Centre. price: $65 (all incl) or $110 (all incl) for both nights. TiCkeTs: www.valleyfirsttix.com or 877.763.2849

CreaTe yOur OWn Wine sTOry All Signature Events are Get Home Safe Events. For more information visit our website, www.thewinefestivals.com

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for the record Village BC as grants officer and parttime store manager, respectively, at the Kerrisdale SOS BC Thrift Store. Trautmann has more than 18 years’ experience in the non-profit sector and, along with her husband, Reiner, developed standards and implemented a nationally recognized apprenticeship program at Aurora College’s Inuvik campus in the High Arctic. McGuire has a diverse background and has held positions as an air force photographer, carhop, talk show host, management training consultant, singer in a rock band and fashion retailer. Colin Stansfield Colin Stansfield has been appointed executive director of the Potluck Café Society and Potluck Café and Catering. Outgoing executive director, Heather O’Hara, has joined CityStudio, a new social enterprise in Vancouver, as its executive producer. Prior to this appointment, Stansfield worked with Ecotrust Canada. Resources Richard J. Hall has been appointed chair of Klondex Mines Ltd.’s board of directors. Hall has more than 40 years of experience leading preciousmetals companies in the Americas and Australia, and presently serves on the board of directors for Iamgold Corp. and Kaminak Gold Corp. Hall has previously served as CEO of Northgate Minerals Corp. and Metallica Resources Inc., chair of Grayd Resource Corp. and chair of the special committee for Creston Moly Corp., and has held senior positions with several other

September 23–29, 2014

companies. Jacynthe Cote has been appointed to Finning International Inc.’s board of directors. Cote was president and CEO of Rio Tinto Alcan from 2009 until June 2014 and served in an advisory role until her recent retirement. Previously, Cote was president and CEO of Rio Tinto Alcan’s primary metal business group where she was responsible for all primary metal facilities and power generation installations worldwide. Prior to that, Cote was president and CEO of Alcan’s bauxite and alumina business unit; she originally joined Alcan Inc. in 1988, and over the course of her 26-year career with Alcan she held senior management roles in business planning, human resources, environment, health and safety in Quebec and England.

Companies on the move Name change After extensive donor-funded renovations and improvements, Richmond Hospital has renamed its Westminster Health Centre to the Milan Ilich Pavilion, recognizing the longtime generosity of the Milan & Maureen Ilich Foundation, whose giving to Richmond Hospital Foundation exceeds $10 million over many years. New in town The Sally O’Sullivan Legacy Fund, which will directly support SOS Children’s Village BC, has been created with the First West

UPCOMING EVENTS

Global BC’s Steve Darling celebrates with Dave Reston, CEO, Pharmasave, and Bill Senghera, president, Variety, at the 24th annual Pharmasave Golf Classic, which raised $35,000 for children who have special needs Foundation. O’Sullivan was a child protection mediator and advocate for children in foster care; she was also a director of Envision Financial Credit Union and served on the board of the First West Foundation from 2001 to 2009. O’Sullivan was instrumental in the growth of the foundation, spearheading a $500,000 fundraising campaign to build two new homes for SOS Children’s Village BC, which were completed in 2006. O’Sullivan passed away in December 2012.

YVR: Redefining B.C.’s Aviation Hub Wednesday, October 22, 2014 | 11:30 a.m. − 2 p.m. President and CEO, Vancouver Airport Authority Supporting Sponors:

Hats Off Business in Vancouver welcomes submissions from local small businesses and large corporations alike that demonstrate examples of corporate philanthropy and community involvement in the Vancouver area. Highresolution images are also welcome. Since 2011, the UPS Foundation has

donated $75,000 to Odd Squad Productions, a Vancouver-based non-profit agency that creates reality-based videos from the perspective of front-line police officers. Cindy Morrison, business development administrative assistant for the Richmond-based Vancouver hub of UPS, began volunteering for Odd Squad in 2011 and has encouraged UPS and its employees to get involved with the non-profit.

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BUSINESSVANCOUVER September 23–29, 2014

for the record

trouble WHO’S GETTING SUED These corporate writs were filed with the BC Supreme Court registry in Vancouver. Information is derived from notices of civil claim. Civil claims have yet to be proven in court. Defendant Pacific Rim Harbour Developments Ltd. Plaintiff How Sound Forest Products (2005) Ltd. Claim $613,509 for debt.

Jim Myers of Jeda Mechanical, Richard Pass of Ronald McDonald House BC and Kyle Biggar of Jeda Mechanical Fairweather Cruises & Events Ltd., on behalf of the Carol Ship Parade of Lights, donated $5,159.60 to the BC Children’s Hospital Foundation. Funds are collected on participating charter boats during the annual Carol Ship Parade of Lights, which runs from December 1 to December 23. Adoptive Families Association of BC (AFABC) is the recipient of the B.C. chapter of the International Association of Business Communicators’ 2014 Gift of

Communications program. This program has provided AFABC with a long-term communications plan focusing on adoption awareness and advocacy. The 24th annual Pharmasave Golf Classic at Surrey’s Northview Golf and Country Club raised $35,000 for Variety – The Children’s Charity. The funds raised will provide life-changing, life-saving and life-enriching support to children who have special needs. In 2013, Variety provided funding

support to over 1,200 families and 32 organizations in B.C. that offer therapeutic programs and services to children who have special needs. Jeda Mechanical supplied HVAC and solar panels to help build and equip the new Ronald McDonald House BC, a donation totalling $70,000. The company’s donation will help provide comfort to seriously ill children and their families, as well as helping the organization to reduce its environmental impact. •

Defendant Nagra Holdings Ltd. Plaintiffs Pallan Holdings Ltd. and Pallan Timber Products (2000) Ltd. Claim $314,656 for debt. Defendants Lee’s Fine Jewellery (2009) Ltd. and Lee’s Fine Jewellery Ltd. and Brian Leonard Lee Plaintiff HSBC Bank Canada

Claim $142,477 for debt. Defendants Kiewit/Flatiron GP, a partnership of Peter Kiewit Sons Co. and Flatiron Constructors Canada Ltd. Plaintiff Specialized Engineered Products Ltd. Claim $109,894 for elevator construction work. Defendant O.P. Land Corp. Plaintiffs Pallan Holdings Ltd. and Pallan Timber Products (2000) Ltd. Claim $83,522 for debt. Defendants Rommel Construction (Squamish) Ltd. and 700 Marine Drive LP, by its general partner Tigeri Marine Property Ltd. Plaintiff East & West Alum Craft Ltd. Claim $82,414 for railing and fence supply and installation work; a builder’s lien.

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for the record Lawsuit of the week Former Gateway Casinos exec wrongfully took a job with a competitor after termination, suit claims Gateway Casinos and Entertainment Ltd. is suing Larry Ho, former director of finance and business analytics and executive general manager of the Starlight Casino, for breach of fiduciary duty and breach of contract after Ho took a job with a competitor while under a non-compete covenant. Gateway filed a notice of civil claim in BC Supreme Court on September 11. The company claims Ho was a key employee who had access to highly sensitive and confidential information during his nearly twoand-a-half-year tenure with Gateway. According to the claim, Ho was terminated without cause or notice on April 28, 2014, and Gateway paid him $175,000, or 12 months’ salary, as severance. In July, Gateway claims it learned that Ho was planning on taking a job at the Edgewater Casino, operated by non-party Paragon Gaming, a competitor, and sent a letter reminding him “of his duties to the plaintiff under the non-compete covenant of the employment contract.” Gateway says it received no response to the letter and Ho started his job with Edgewater “in breach of his fiduciary duty to the plaintiff,” the claim states. It seeks damages for breach of contract and breach of fiduciary duty and costs. The allegations have not been proven in court and Ho hadn’t filed a response by press time.

Defendant L’Unique General Insurance Inc. Plaintiff Preview Builders International Inc. Claim $77,011 for a performance bond.

Defendant Synergy Trucking Ltd. Plaintiff Fraser Valley Packers Inc. Claim $64,095 for produce damaged during transport.

BUSINESSVANCOUVER September 23–29, 2014

Defendants Dave Sachio Mori and Aaaaah-So Easy Mobile Mini Storage (Vancouver) Corp. Plaintiff Yellow Pages Group Corp. Claim $60,619 for advertising and website services.

Defendants Chevron Canada Ltd. and John Does 1-10 and John Doe Operators 1-5 Plaintiff St. Thomas More Collegiate Ltd. Claim Damages for negligence and recovery of costs to remediate land contaminated by hydrocarbons.

Defendants AZ Plumbing & Gas Inc. and Allan Zastre Plaintiff Andrew Sheret Ltd. Claim $33,070 for plumbing supplies.

Defendants Les Kjosness and James R. Broad and Richard David Somerville and Byron Keith Shirley and Kirsti Mattson and Golden Arch Resources Ltd. and Armadillo Resources Ltd. Plaintiffs Willis Associates Insolvency Services Ltd., trustee of the estate of Silver Peak Resources Ltd., and Richard John Watson Claim Damages for fraudulent conveyance and fraudulent preference of property.

Defendant Marcer Ranching Ltd. Plaintiff Agnes B. Kennedy Claim Specific performance and damages for breach of a real estate contract. Defendants Natural Balance Home Builders and Natural Balance Development Group Inc. and ABC Co. and BCD Co. and CDE Co. Plaintiffs William Ran Clerihue and Waltraud Ellfiede Lorraine Clerihue Claim Damages arising from a flood.

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Defendant Active Pharma Inc. Plaintiff Rhema Health Products Ltd. Claim Damages for breach of contract after defendant supplied plaintiff with raw materials for health food products that contained unacceptably high levels of gluten allergen. Defendants PCL Constructors Westcoast Inc. and Professional Mechanical Ltd. Plaintiffs Hoopp Realty Inc. and Robson Central (1994) Inc. Claim

Damages arising from a flood. •

K biv.com

for more lawsuits, go to biv.com/whos-getting-sued

Defendants Trans Mountain Pipeline ULC and The National Energy Board Plaintiff City of Burnaby Claim Injunctive relief to prevent Trans Mountain Pipeline from contravening City of Burnaby bylaws and a declaration the Britishthat Columbia National Energy Board does not have constitutional jurisdiction to issue order that directs or limits the city from enforcing its bylaws.

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BUSINESSVANCOUVER September 23–29, 2014

Editorial

President/Publisher | Paul Harris, 604-608-5156 editor-in-chief | Fiona Anderson, 604-608-5183 Managing editor | Timothy Renshaw, 604-608-5131 Deputy Managing editor | Mark Falkenberg, 604-608-5174 Business in Vancouver is owned by Glacier Media Inc., 102 East Fourth Avenue, Vancouver, B.C. V5T 1G2

City accounting books need a second look

ith the Union of BC Municipalities convention underway this week, citizens of the province’s cities and towns should be assessing how their local governments are doing on numerous fronts. Fiscal management would be a good start. That in part was the rationale behind the provincial government’s November 2011 introduction of the

Of parallel concern are rapidly escalating local government liabilities Auditor General for Local Government Act. As the Canadian Federation of Independent Business’ fourth annual B.C. Municipal Spending Watch report noted at the time, municipal operating spending had “ballooned to nearly four times the rate of population growth in B.C.” Revelations last week from an EY report showed again that municipal budget decisions need third-party scrutiny. For example, the report,

last laugh

commissioned in 2013 by the province, revealed that cumulative salary increases for municipal workers between 2001 and 2012 were 38% compared with 19% for their core provincial government brethren. The report concluded that “local government compensation is not coordinated (or regulated)” and that in many cases municipalities are paying higher compensation for comparable roles. So where is the province’s auditor general for local government (AGLG) on this? Largely missing in action, according to the Canadian Taxpayers Federation. It points out that Basia Ruta has filed only one report since she took over her role in January 2013 – well short of the three audits Ruta promised by spring 2014. Of parallel concern are rapidly escalating local government liabilities. For example, a Fraser Institute report released in July noted that the City of Vancouver’s net liabilities more than quadrupled from $101 million in 2006 to $419 million in 2011, and its gross liabilities reached a record high of $1.8 billion in 2013. But it should not be left to citizens, groups and think-tanks to do all the auditing of local government. The AGLG’s office needs to start delivering on the initial promise of its mandate.

Plane truths about the environmental impact of air travel

At Large Peter Ladner

s anyone else having this conversation as we turn the corner into fall and winter? “So, how was your summer? Did you get away anywhere interesting?” (I respond that I had a great kayaking trip in Haida Gwaii, flying in and out. Blah blah blah, and you? etc.) Then: “Do you have any travel plans for the fall?” As my friends and acquaintances get older (is this just me?) we seem to define ourselves by how far we fly every year: winters in Phoenix, trekking tours in Bhutan, Broadway shows in New York, shuttles to Etobicoke to see the

grandchildren. Young people are in this game too. If you haven’t been to Thailand or Laos before you’re 25, like, really, what have you been doing? Flying off to the Coachella music festival is all in a weekend’s play. Needless to say, anyone in business who isn’t flying around to meet sales reps, keep up at conferences, attend board meetings or feel the pulse in China is barely credible. What continues to amaze me is how unreal even so-called environmentalists can be about the environmental impact of flying. Many of us frequent flyers are horrified at people who don’t recycle; we carry coffee cups to avoid throwaways; we buy fuel-efficient cars, take the bus or even cycle to reduce our impact on the environment, but air travel is the elephant in the sky. We sort of know that the impact of these huge carbon emissions at high

what’s your opinion?

altitude (an estimated 3% of global greenhouse gas emissions and rising) is two to four times more harmful than the same emissions on the ground. But that does not compute when we rank what we’re willing to change, or whether YVR should even talk about a limit to the growth of air travel. Here’s another set of facts that will be greeted with whatever response suits the tribe we’re in: according to the latest PwC Low Carbon Economy Index, the world is on an “unmistakable trend” toward a human-caused climate disaster. At current rates, we’re looking at 4 C above pre-industrial levels by the end of the century, twice the 2 C target agreed to at the United Nations 2009 climate summit. In other words, we are knowingly setting up our grandchildren for rising sea levels, coastal flooding, crippling heat waves, unprecedented droughts, torrential downpours,

widespread food shortages, species extinction, pest outbreaks, economic horror and exacerbated civil conflicts and poverty. I know. I don’t want to hear it either. According to George Marshall, who was recently at University of British Columbia promoting his new book, Don’t Even Think About It: Why Our Brains Are Wired to Ignore Climate Change, humans have evolved to respond to threats that are visible and immediate, have historical precedent and direct personal impact, and are caused by an “enemy.” Climate change is none of these. It is invisible, unprecedented and drawn out, it affects us indirectly, and the enemy is us. Marshall cites Nicholas Stern, economist and author of the Stern Review, who says climate change is “the perfect market failure”: we would rather risk losing 20% of annual income in 50 years than spend 1% today.

Other commentators on this tragic trait say the answer is to focus on concerns we all share that can be dealt with today. Rising sea levels is a good example; it’s happening now and everyone can understand it. So kudos to Simon Fraser University’s Public Square and the Vancouver Foundation for putting up a $35,000 prize for RISE, an ideas competition for addressing the sea level rise that is poised to paralyze port, road and air transportation and trigger other economic, social and environmental upheavals in Metro Vancouver. Pointing to positive actions, rather than hectoring people with grim facts, may possibly help us rewire our brains. Or not. I just bought my tickets to China in October. • Peter Ladner (pladner@biv.com) is a co-founder of Business in Vancouver. He is a former Vancouver city councillor and former fellow at the SFU Centre for Dialogue. He is the author of The Urban Food Revolution.

| BIV welcomes readers’ opinions. All letters, including those sent by email, must include the author’s name, address and daytime telephone number. Business in Vancouver, 102 East 4th Avenue, Vancouver, B.C. V5T 1G2. Email: news@biv.com. We reserve the right to edit for brevity, clarity and legality.

BUSINESSVANCOUVER September 23–29, 2014

Opinion Core of B.C. teachers union in serious need of housecleaning

None of My Business Trevor Lautens

he abusive power of the neo-Marxist ideologues who have dominated the core of the BC Teachers’ Federation (BCTF) for decades must be crushed. If this doesn’t come from within, through a revolt against those further left than the New Democratic Party itself – unlikely because those who hold the BCTF’s 40,000 members in thrall won’t abdicate without one hell of a fight – it should come from outside, from the government. Never again must students, parents and businesses, especially in smaller towns – not to overlook the moderate and even slightly left-leaning teachers who privately think that schools should never be shut down in labour disputes – be held hostage to the “progressives.” It’s intellectual duplicity that BCTF leaders claim to fight for abstract students while hurting the actual flesh-and-blood ones. Let’s cut to this particular chase. Dr. Pat McGeer, a former BC Liberal Party leader in its gloomiest days, an outstanding cabinet minister (including minister of advanced education) in the Bill Bennett Social Credit government, and one of the brainiest and most widely accomplished British Columbians of his or any time, gave his sharply pertinent opinion in a letter to the Vancouver Sun editor soon after the BCTF strike

began in June. And plain and unadorned it was. Two proposals. “The first is to pass legislation declaring education an essential service and strikes impermissible,” McGeer wrote. “The second is to eliminate the requirement of membership in the BCTF to be a condition for teaching in a B.C. public school.” McGeer is ringingly right. Any private business, wielding monopoly power, that stopped services to 500,000 customers, and caused costly and anxietyprovoking inconvenience such as B.C.’s parents suffered, would be legislatively crushed like a bug by swift government action. I was astonished on moving from Ontario, home of conservative premiers John Robarts, Leslie Frost and Bill Davis, to Vancouver where the BCTF president was a genuine card-carrying Communist – Jim McFarlane. You kidding me? Member of a Moscow-directed party, while the Soviet Union aimed missiles at Canadian cities? How could any thinking person countenance that? Answer: many didn’t think. Some did, too late. No one wants to talk about it, but there’s still a rump of B.C. nostalgists and apologists for the good old Soviet Union that collapsed in 1989. The ones who marched for peace, Moscow’s definition. Called for “unilateral disarmament.” Invoked “moral equivalency” – between the West and mass murderers Lenin, Stalin, Mao. Of course favoured Uncle Ho in Vietnam. They went somewhere, teaching an obvious destination, where they influenced the young – as a current university student, I can attest that the academy still makes brief bows to Karl. The

environment is another, where BANANA (build absolutely nothing anywhere near anything) is an ingratiating fantasy that keeps a straight face about how then to fund government welfare. How radical, how much in the socialist “vanguard” that secretly makes many mainstream unionists uneasy, is the BCTF core? Someone with top-tobottom experience in education pointed out: note presidents who serve only one year. That’s because they’re deemed “soft.” One I knew doubtless shared conventional leftist views, but he was shrewd, pragmatic, nobody’s fool. Just not anti-capitalist enough. In my early teens, teachers were so poorly paid that they commonly took summer jobs – my oldest school friend, back to Grade 4, recalled that even her father, an elementary school principal, did so. (Recently a West Vancouver woman, bitterly damning the system’s allegedly poor provision for her autistic children, shocked even my good self by declaring that teachers still should – why pay them for a year when they work only 190odd days?) No support here for that. And none for the ideologues who openly campaign against B.C. governments – even the New Democrats are just too right-ofcentre for them. Teachers, who likely will never make up their lost wages, deserve better. • Trevor Lautens writes every second Tuesday in Business in Vancouver. He was once a shop steward and membership director of his union local, the American Newspaper Guild, and 30 years ago a communications consultant for B.C.’s ministry of education.

LETTERS Municipal leaders missing mining’s importance to B.C.’s economy Why are some Lower Mainland mayors so hell-bent on kicking the legs out from underneath B.C.’s and Western Canada’s resource economy? They are biting the hand that feeds them. Have they forgotten that Vancouver is really nothing more than a port that funnels B.C.’s and Western Canada’s valuable natural resources to the world? Without B.C.’s vast mineral, forest and energy resources Vancouver would be a virtual nobody without an economic base. Without the mining and mineral exploration industries, downtown Vancouver would be a ghost town. As a lawyer friend who works in a large downtown law firm told me, most of his firm’s work revolves around forestry, mining and First Nations. Short-sighted NDP mayors such as Derek Corrigan and Gregor Robertson should bear this in mind and stop biting the hand that feeds them and all of us who live here in the Lower Mainland. Mike Taylor, Coquitlam

Complacency killing career opportunities for B.C. grads Our graduates are one of the most important assets we have, but we’ve been squandering that asset for decades. Instead of being outraged at the number of our graduates who are unemployed or underemployed, we’ve become complacent about it, accepting it as the “new normal.” The cost of our complacency to the economy must be huge. Most colleges and universities are doing a poor job of preparing our graduates for today’s workplace. Nathan Hatch, the president of Wake Forest University, commented on the approach universities take toward their career-services area: “For years, most liberal-arts schools seemed to put career-services offices somewhere just below parking as a matter of administrative policy.” He has made the career-services area at Wake Forest University a top priority and has allocated the resources needed to ensure its success. Michael S. Roth, president of Wesleyan University, has created a new career centre prominently located on campus and wants the career program “to work with our students from the first year to think about how what they’re learning can be translated into other spheres.” Six U.S. undergraduate business schools require students to attend classes that prepare them for the process of finding work, and they must complete these classes before they can graduate. Six U.K. further education colleges are working with venture capitalists and entrepreneurs to help their graduates create their own jobs. Fintan Donohue, the head of one of them, said: “Everyone is in favour of entrepreneurship, but what we’re saying is that colleges like ours need to embrace an entrepreneurial culture.” What these examples show is that there’s no excuse for sending our graduates out into the workplace as unprepared as they are currently. Having a degree, even from a top-tier university, isn’t going to help graduates find employment in their field unless they’ve also been given the tools and strategies they need to understand today’s workplace and how to succeed in it. It’s time we demanded that they be given these tools and strategies. Ron McGowan, author, How to Find Work in the 21st Century

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BUSINESSVANCOUVER September 23–29, 2014

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Deadline for Datebook listings is noon Tuesday for the following week’s paper. All submissions are subject to approval and cannot be guaranteed. We reserve the right to edit for brevity and clarity. Please go to www.biv.com/events/calendar to post your listing.

Breakfast Business Excellence Series: Money & Finance

October 2 7 AM Startup funding, incubators, financial institutions, angel investors and family members’ pockets – these are just a few areas where businesses source cash. But everyone knows purse strings are being pulled tight. What are the options available – and at what stage of the business? Each phase of a company’s growth requires a different strategy. In BES Money & Finance, we explore new and traditional resources to get the cash flowing again. Chris Wilson. Pan Pacific Hotel. Crystal Pavilion. 999 Canada Place. Suite 300. 604-6085140. cwilson@biv.com.

Managing Employee Terminations

October 7 8 AM Dismissing

employees is the toughest job a human resources (HR) professional faces, so it’s essential to learn to manage terminations properly. HR professionals are the ones on the front lines who have to deal not only with the legal aspects of terminations, but also with the practical aspects of letting someone go. Make sure you have all the information you need to deal with this challenging part of HR’s responsibilities. Accent Inn. 3777 Henning Drive. Vancouver. Sabine Just. 604-298-7795. sabine@icba.ca.

Conferences

Sunday, September 28 Literacy Is Life Team Trivia Challenge Support community-based literacy programs at The Butcher & Bullock pub

12th Annual UBC Net Impact Conference

October 24 8:30 AM The conference will focus on social investment – sometimes referred to as impact investing – and social enterprise. The conference will aim to deepen our understanding of socially responsible financing by addressing questions such as: How do we balance financial and social impact? What are the risks associated with impact investing? What happens post-investment? The goal of the conference is to bring together experts from various

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Thursday, October 2 Business Excellence Series: Money & Finance

Explore new and traditional resources to get your business’ cash flowing, at the Pan Pacific Hotel

36th Angel Forum for Startups & Angel Investors

September 30 8 AM For highgrowth startups: apply by September 30 and be approved to present to more than 60 angel investors. Angel investors will hear, meet and see demos by 18 pre-selected emerging growth companies in one day. The Angel Forum is the oldest and largest angel group in Canada; visit bit.ly/ angelforum for more information. Must pre-register. 505 West Hastings Street. Vancouver. Bob ChaworthMusters. bob@angelforum.org.

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fields including technology and entrepreneurship, housing, food and agriculture and natural resources, in an effort to better understand how the business world perceives and employs principles of social finance. We aim to create an exciting learning environment for all by providing a broad representation of socially responsible ventures. Vancouver Convention Centre. 1055 Canada Place. Vancouver. ubcnetimpact@ gmail.com.

Courses, Workshops, Seminars From Good to Great: Advanced Communication Skills Workshop

September 26 8 AM This course is a tune-up, oil change and radiator flush of your communication skills professionally and personally. You will learn to understand the impact of your verbal communication and written communication as well as the impact your words, tone and body language have on your listeners and readers. Coast Coal Harbour Hotel. 1180 West Hastings Street. Vancouver. Gurjeet Phungura. 604412-4886. gphungura@apeg.bc.ca.

The Significance and Implications of the SCC Tsilhqot’in Decision

September 26 8:30 AM This is a groundbreaking chapter in the evolution of Canadian aboriginal law. It is the farthest-reaching decision on First Nations’ land claims and title. The implications for First Nations, industry and provincial and federal governments have been described as “massive,” “game-changing” and “staggering.” Chaired by those with over a decade of experience on the case at trial, on appeal and at the Supreme Court of Canada, this course explains critical changes and the impact on: the definition of aboriginal rights and title; unsettled and new land claims; projects and partnerships between First Nations and industry, including consultation and accommodation; the role of

provincial and federal governments; and treaty negotiations. For the agenda and more information, see www.affinityinstitute.ca. SFU Segal Graduate School of Business. 500 Granville Street. Vancouver. Janelle OConnor. 778-926-0862. jroc@ affinityinstitute.ca.

The Dynamics of Business Growth

September 26 1 PM Starting a business is tough, but growing a business is tougher. Develop your growth plan and transition successfully into the next stage of business. Building the right strategy will help you avoid the pitfalls of growing too quickly or too slowly. Learn how your current business activities are affecting growth and concentrate on removing the barriers. Part 1 is “The Growth Environment”: understand how rapid growth can kill your business, discover the four aspects of enterprise, find the transition points in your business and identify the three roles a founder plays in growing your business. Part 2 is “Developing the Plan”: how to select a team, understand the importance of the diagnostic phase, use the SWOT analysis for planning, learn how to develop and implement strategies and discover the myths of planning. Presented by Bill Erichson of Pacific Training Innovations. Small Business BC. Suite 54. 601 West Cordova Street. Vancouver.

FWE Mentor Program

October 1 9 AM The Forum for Women Entrepreneurs’ (FWE) Mentor Program strategically pairs mentees based on the mentee’s stage of business, needs and business goals, with the experience and expertise of mentors. Pairs meet once a month from October 2014 to June 2015. Forum for Women Entrepreneurs. 409 Granville Street. Suite 1208. Vancouver. Michelle Cheong. 604682-8115. michelle@fwe.ca.

Fundraisers Literacy Is Life Team Trivia Challenge

September 28 3 PM Make your answers count. Use your knowledge to support literacy in your community. Join us for one of the fastest-growing activities in Metro Vancouver – trivia nights! This isn’t just any boring fundraiser – we have tons of fabulous prizes lined up, and all players get a free burger and drink. Get your team together and make your answers count. Hosted by The Butcher and Bullock pub and Nice Guys Trivia, you and five friends can show off your trivia skills, get creative with your costumes, meet new people and have a blast – all while supporting a great cause. Proceeds from the challenge will stay in B.C. to support community-based literacy programs and initiatives for people in over 400 communities. Together we will help create jobs, improve health, reduce crime and build strong individuals, strong families and strong communities. Butcher & Bullock. 911 West Pender Street. Vancouver. Gail Hanney. 604-6814199, ext. 411. ghanney@decoda.ca.

Trade shows SOHO SME Business Expo

October 30 8 AM Join thousands of business owners, entrepreneurs and marketing executives who will inspire, motivate and drive your business success. There will be keynote speakers, panel sessions, interactive exhibits and displays, a free coach’s corner, business skills competitions, live demos, Startup Alley great networking, prizes and more. Don’t miss the featured keynote, Meredith Powell, co-founder of The Next Big Thing foundation, and other amazing game-changing entrepreneurs. Register now or become an exhibitor at www.vancouversme.soho.ca. Enter promo code “BIV” and get free all-day access, plus save $20 to attend the SOHO SME after-party. Sheraton Wall Centre. North Tower. Pavilion Ballroom. 1088 Burrard Street. Vancouver. •

BUSINESSVANCOUVER September 23–29, 2014

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On learning how to listen | “Todd Yuen, president of our industrial division, … I learn from him all the time. He has this skill, this knack, and he genuinely cares, whether it’s an employee who comes in with concerns – he feels it. It’s not … dismissive, ‘we don’t have time for it,’ it’s the opposite: everything matters.” •

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