2012 – Page 150 – Republic of Mining

Canada chromite project costs triple: Cliffs Natural Resources – Reporting By Steve James – (Reuters – February 16, 2012)

February 17, 2012

http://ca.reuters.com/

(Reuters) – The cost of developing what may be the largest chromite deposit in North America has tripled from the original $1 billion estimate, a major participant, Cliffs Natural Resources, said on Thursday.
“Initially we did go out with a billion-dollar price tag for this project,” said Chief Executive Officer and Chairman Joseph Carrabba.

“(Now) We’re in about the $3.3 billion range,” he told Wall Street analysts during a conference call, when asked about the status of the Black Thor chromite deposit Cliffs is developing in northern Canada.

Carrabba said the estimate had risen mainly because road construction in the remote Ontario location had not been included in the original estimate. He said there had been a “sharpening of the estimate” as the project moves through the pre-feasibility stage.

“The transportation and the road has gotten more expensive in this segment than we expected and everything else is falling in line with that.”

Mining and Resource Development in Northern Canada – by David Kilgour: City of Greater Sudbury Municipal Councillor

February 16, 2012

David Kilgour is a City of Greater Sudbury municipal councillor. He gave this presentation to the House of Commons Standing Committee on Natural Resources, which is considering the federal government’s role in the development of the Ring of Fire, on February 16, 2012.

Mister Chair and Honourable Members,

On behalf of Her Worship, Mayor Marianne Matichuk, members of city council and the citizens of the City of Greater Sudbury, I am pleased to be here this morning to discuss mining and resource development in Northern Canada; a subject that we in Sudbury know something about.

Greater Sudbury is an undisputed global centre of mining expertise. Over the past one hundred and thirty years, billions of dollars worth of Nickel, Copper, Platinum, Gold and many other metals have been mined, milled, smelted and refined in our city. Today, even with more than a century of mining activity, an estimated forty billion dollars of mineral reserves have been identified and constant exploration adds to this total every day.

We are the largest geographic municipality in Ontario; within our municipal
boundaries, approximately seven thousand workers are employed directly in mining production and mineral processing while about twice that number work in the mining supply and services industry. Nowhere else in the world will you find this level of mining activity within a fully urban city.

Building a [mining] workforce [in Thunder Bay and the Northwest] – Special to The Chronicle-Journal (Thunder Bay Chronicle-Journal – February 16, 2012)

February 16, 2012

The Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

With the anticipated boom in the mining sector, industry leaders and organizations are taking steps to ensure the workforce is ready.

On Wednesday the North Superior Workforce Planning Board and the Thunder Bay Community Economic Development Committee hosted a forum that looked into some of the employment and training opportunities and challenges that exist in the mining sector in Northwestern Ontario.

More than 200 participants attended the forum. Among the participants were job seekers, mining companies, service providers, government representatives and educators, who discussed how the workforce can be prepared for expanding job opportunities in the mining sector.

Madge Richardson, executive director of North Superior Workforce Planning Board, said the forum was also an opportunity to release a report on the region’s mining industry employment forecasts for the next two, five and 10 years.

All eyes on tight oil’s future – by Claudia Cattaneo (National Post – February 16, 2012)

February 16, 2012

The National Post is Canada’s second largest national paper.

CALGARY – Tight oil, the new oil source unlocked by new drilling technologies, is bearing such good results it could quickly compete with Canada’s oil sands as a top secure supply of North American oil.

With companies like Devon Energy Corp., Talisman Energy Inc., Encana Corp. and Exxon Mobil Corp. pushing big spending toward tight oil, analysts are ratcheting up their production forecasts for the supplies, which are largely based in the United States.

“Tight oil is changing the landscape in North America,” Steve Fekete, managing consultant at Purvin & Gertz, said at an oil sands industry conference in Calgary this week.

The international energy consultancy predicts production of tight oil in the United States alone could reach between 1.4 million barrels a day and 2.4 million b/d by 2020 – from about 600,000 b/d today derived in large part from the Bakken field in North Dakota.

AngloGold CEO says Warren Buffett just doesn’t understand gold and gold investors – by Alec Hogg (Mineweb.com – February 16, 2012)

February 16, 2012

www.mineweb.com

Mineweb’s Editor-in-chief, Alec Hogg, interviews AngloGold Ashanti’s Mark Cutifani and hears some forthright views on Warren Buffet’s most recent attack on gold.

JOHANNESBURG – Anglogold Ashanti’s CEO Mark Cutifani is to local South African gold mining what top South AFfrican asset manager, John Biccard is to the local asset management sector, the man other money managers would most trust to handle their savings. In mining, Cutifani’s astute management has raised the bar for an industry where performance was once measured by volume of rock through the mill rather than gold delivered.

The Australian-born head of Africa’s biggest gold producer has been walking on water lately. He took history’s biggest ever bet on the gold price by closing out the industry’s largest hedge book – at a cost of billions. As the gold price kept steaming ahead, that decision continues to reward Anglogold Ashanti. In the three months to end December it added another $200m to the bottom line.

Cutifani was clearly on a high during our chat this week after the release of his group’s December quarter results. Who could blame him? Apart from that $200m, costs were reasonably controlled, the company got more South African Rands for its gold and the result was a fresh record for profit in any three months. Shareholders joined in the applause when hearing that the yearend dividend was being doubled.

Growth won’t save Ontario this time. Only reform will – by Don Drummond (Globe and Mail – February 15, 2012)

February 15, 2012

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Don Drummond, former chief economist at TD Bank, is chair of the Commission on the Reform of Ontario’s Public Services.

Ontario faces two huge challenges – economic and fiscal.

The province has already slid below the average of the rest of Canada in terms of output and income per capita. Beyond the next few years of recovery, Ontario can look forward to only modest annual growth of around 2 per cent, well below historical norms.

This reality frames the fiscal problem. The province can’t simply adjust its fiscal parameters for a few years to eliminate a deficit caused by the recession and associated stimulus. Even with the restraint measures already taken, the provincial deficit would continue to rise in an environment of modest economic growth. The fiscal response must not only be strong and sustained, it must reform the way the government delivers virtually every service.

Last March’s provincial budget established the Commission on the Reform of Ontario’s Public Services to advise the government on how to return to a balanced budget no later than 2017-18 and how to get more value for taxpayers’ money.

Drummond report shows sun has set on Ontario empire … but, will it notice? – by John Ivison (National Post – February 15, 2012)

February 15, 2012

The National Post is Canada’s second largest national paper.

We couldn’t read the Premier’s lips because he was conspicuous by his absence. But Dalton McGuinty has been explicit in recent speeches — the $16-billion deficit that is on course to balloon to $30-billion within seven years, will not be balanced by raising taxes.

That means the Premier will have to implement all 320 recommendations made by economist Don Drummond and his Commission on the Reform of Ontario’s Public Services, released Wednesday. Except, the Ontario Liberals have already made clear they will ignore Mr. Drummond’s suggestion on Mr. McGuinty’s pet full-day kindergarten project — namely that it is a $1.5-billion luxury the province cannot afford.

The former TD Bank chief economist pulled no punches in his press conference: “This is pretty much unprecedented in post-war Canadian history. It is very daunting. Lots of governments have had it tough for two to three years. But then there was a reprieve. There is no reprieve here,” he said, pointing to low growth rates as far as the eye can see.

The report said the slow decline of Ontario’s manufacturing sector is partly to blame for the malaise that will see the deficit double and net debt rise to 50% of GDP by 2017/18. But it did not gloss over the culpability of a Liberal government that has failed to keep spending in line with revenue growth.

Diavik releases 2011 annual socio-economic report

February 15, 2012

This news item originally came from the January 2012, Northern Mining News, published by the NWT and Nunavut Chamber of Mines.

Diavik Diamond Mines Inc., operator of the Diavik Diamond Mine, has released its 2011 socioeconomic monitoring agreement report, which provides a detailed summary of northern training, employment, and business benefits.

Highlights include:

• Training: As part of the mine’s continuing commitment to support northerners in developing trade skills, Diavik and minesite contractors supported 34 apprentices in 2011. All are northern and 19 are Aboriginal. Additionally, four northerners successfully completed their apprenticeships bringing the total number of Diavik apprentices to have achieved journeyperson certification to 31.

Stakeholders brace for sweeping changes on environmental protection laws – by Mike De Souza (Ottawa Citizen – February 15, 2012)

February 15, 2012

www.ottawacitizen.com

OTTAWA — Industry and conservation groups are bracing for the federal government to introduce sweeping changes this month to reduce Canada’s environmental protection laws in order to speed up reviews on proposed projects.

All stakeholders agree that certain changes would be welcome to improve the process, but some have also warned the government that it could cause more harm than good if it proposes a plan that ignores long-term benefits or consequences of projects.

“It’s all very well to say we need more mines, but how do we actually know that they are actually going to be sustainable or going to be of net benefit to Canada?” asked Stephen Hazell, an Ottawa-based environmental lawyer.

While he said some mines have clear benefits, he noted that a recent arsenic spill at an old gold mine near Yellowknife raises serious concerns, especially because of melting permafrost.

Molycorp’s $1 billion rare-earth gamble – by Richard Martin (Fortune Magazine – November 18, 2011)

February 15, 2012

http://money.cnn.com/magazines/fortune/

How an American company is trying to break China’s monopoly on high-tech minerals.

FORTUNE — Few weekenders making the four-hour run from L.A. to Vegas notice the big mill works overlooking Interstate 15 at Mountain Pass Summit in California, near the Nevada line. Even fewer realize that the pale-pink buildings, gone patchy with age, are the focus of an extraordinary business drama that involves national security, China’s monopolizing the strategic market in rare-earth metals, and one company’s attempt to restore American preeminence in a crucial mining sector it once dominated.

Those sprawling buildings are owned by a Denver mining company called Molycorp (MCP), which is now spending nearly $1 billion to restart rare-earth-mineral production at Mountain Pass Summit and in the process revive a moribund U.S. industry. It won’t be easy. A decade ago the U.S. was the world’s biggest supplier of lanthanides, scandium, and other rare earths, and the Mountain Pass mine was the world’s largest producer of the minerals.

Rare-earth elements enable the creation of super-magnets, which operate at high temperatures and are also used for a range of high-tech applications, from missile-guidance systems to compact fluorescent light bulbs to wind power turbines to motors in electric vehicles.

A hedge fund bets big on a Canadian mega quarry – by By Scott Cendrowski (Fortune Magazine – February 15, 2012)

February 15, 2012

http://money.cnn.com/magazines/fortune/

Superstar investor Seth Klarman’s controversial plan to develop a quarry in Ontario could pay off bigtime.

FORTUNE — Drive an hour northwest from Toronto along Highway 10 and you come across some of the best farmland in Canada. Folks here call it the Garden of Eden. Atop a 15,000-acre plateau sits a layer of dark dirt so perfectly balanced with clay and nutrients that it breaks apart in your hand like potting soil. “The stuff is like butter,” says a local potato farmer, David Vander Zaag, who sells his spuds to Frito-Lay. Even better: Below the rich topsoil lies a limestone deposit some 200 feet thick, creating an ideal natural drainage system. It once rained nine inches in a day, says Vander Zaag, and he didn’t lose a single potato from his crop.

It’s that limestone, though, that has brought the farming town of Melancthon, Ontario, pop. 2,900, the fight of its life. Last spring a Canadian firm called the Highland Cos. submitted an application to turn 2,300 acres of area farmland into one of the top-producing rock quarries in Canada. One of the principal owners of Highland is the Baupost Group, a $24 billion hedge fund based in Boston and run by a secretive investor named Seth Klarman.

Highland’s quarry proposal has ignited a firestorm of controversy in Melancthon. Residents have myriad concerns — from increased truck traffic to the impact on the water supply to the unsightliness of an enormous pit mine in the distance.

New B.C. port facilities key for exports, Potash Corp. CEO says – by Shawn McCarthy (Globe and Mail – February 15, 2012)

February 15, 2012

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

OTTAWA— Potash Corp. chief executive Bill Doyle expects to see steadily rising worldwide demand for the fertilizer and the need for new export capacity from Western Canada, despite the recent price weakness that has led global producers to cut back on supply.

Western Canadian potash exports should double in the coming decade and, as a result, the industry will need new port facilities in British Columbia, Mr. Doyle said in an interview Tuesday.

In partnership with CN Rail, Canpotex, the marketing arm of Saskatchewan potash producers, has proposed a new export terminal in Prince Rupert, B.C. Mr. Doyle said he expects an investment decision to be made on the $800-million project this year.

TransCanada pushes back on Keystone XL – by Claudia Cattaneo (February 14, 2012)

February 15, 2012

The National Post is Canada’s second largest national paper.

Getting swept up in U.S. Presidential politics can’t be high on the list of any Canadian corporation, but TransCanada Corp. isn’t backing down from its plans to build the Keystone XL oil sands pipeline.

The Calgary-based company said Tuesday it’s gearing up to file for a new permit “in the near future,” is anticipating obtaining Presidential approval in the first quarter of 2013, expects it will take two years to build it and plans to start shipping 830,000 barrels of oil from the oil sands in Alberta to the U.S. Gulf Coast in 2015.

“We are into it to the tune of $2.4-billion, we have secured about 95% of the right of way, the pipe is all sitting on the ground and the pumps are all ready to be hooked up. For all intents and purposes we are ready to go,” president and CEO Russ Girling said in a conference call to discuss the company’s results for the fourth quarter.

What it won’t do is get involved in the U.S. election, which Mr. Girling feels is not his company’s business.